Feb 23 2019

Rupee posted its 2nd weekly rise against the US. Dollar

Weekly Synopsis

Date:- 23rd February 2019

Markets from 18th February 2019 to 22nd February 2019:-

Indian Rupee:-

Indian rupee posted a second weekly rise against the dollar, as optimism over trade talks between the U.S. and China lifted investors’ appetite for risk assets and weighed on greenback demand. On a weekly basis, it rose 0.1%, adding to last week’s 0.1% gain. The rupee settled at 71.14 to a dollar on Friday against 71.22 at previous close on 15 Feb 2019. The pair trades in a weekly range between 70.91 to 71.52.

India’s foreign exchange reserves rose to $398.27 billion as of Feb 15, compared with $398.12 billion a week earlier, the Reserve Bank of India said on Friday. Changes in foreign currency assets, expressed in dollar terms, include the effect of appreciation or depreciation of other currencies held in its reserves.

Global Market:-

The U.S. dollar snapped a two-week winning streak on Friday after slipping against its rivals as a rebound from session lows in the pound and dovish comments from the Federal Reserve vice chairman weighed. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last seen at 96.48 down 0.05%.

GBPUSD rose 0.16% to $1.3070 from a session low of $1.2969 on hopes the deadline for the U.K. to leave the European Union on March 29 would be pushed back. The European Union’s Brexit negotiator, Michel Barnier, said Friday he could not rule out the possibility that Britain’s EU withdrawal would be delayed.

Inflation in the euro zone slowed to a seven-month low in January, data confirmed on Friday. The bloc’s statistics agency Eurostat said the consumer price index rose 1.4% in January from the same month a year earlier, down from 1.5% in December. Prices for the month of January fell 1%, from an initial estimate of -1.1%.

German business confidence hit its weakest level in nearly five years in February with no sign of a turnaround yet in sight. The Munich-based Ifo economic institute said its business climate index, based on a monthly survey of companies, declined to 98.5 this month, its lowest level since November 2014.The reading was worse than economists’ expectations for 99.0.

Sales of previously-owned U.S. homes fell unexpectedly in January, to the lowest level in more than three years, but the National Association of Realtors believes they have finally hit a bottom. Existing home sales fell 1.2% in January from the previous month to an annualized pace of 4.94 million units, according to NAR figures released on Thursday.

Manufacturing conditions in the area covered by the Philadelphia Federal Reserve weakened in February, tumbling to their first negative reading in more than two years. The Philadelphia Federal Reserve’s manufacturing index fell to a reading of minus 4.1 from 17.0 in January, the first negative reading since May 2016.

The number of people who filed for unemployment assistance in the U.S. fell more than expected last week, indicating the American economy is still robust and suggesting that after last week’s surprise increase in unemployment numbers may be a blip. The U.S. Department of Labor said that the number of individuals applying for initial jobless benefits in the week to Feb. 15 fell to a seasonally adjusted 216,000.

Orders for durable goods, which are meant to last at least three years or more, rose more than expected in December, according to data released on Thursday. Durable-goods orders increased 1.2% last month, the Commerce Department said. Economists had forecast a 0.8% rise.

Markit said that its flash Euro Zone Composite Output Index, which measures the combined output of both the manufacturing and service sectors, rose to 51.4 this month, improving from 51.0 in January. Economists polled by Investing.com had forecast a reading of 51.1.

Federal Reserve policymakers expressed a willingness to end their balance sheet unwinding program later this year and keep rate hikes on hold to get a better sense of the health of U.S. economy and the extent of deteriorating global growth, minutes published Wednesday showed.

The U.K.’s labor market tightened further at the start of 2019, despite evidence of a broad slowdown in the economy under pressure from Brexit-related uncertainties and broader concerns about global trade. The unemployment rate remained unchanged at 4.0% in the three months to December, matching expectations. That was its lowest level since February 1975.

U.K. retail sales rose by 1% in January, as consumers shrugged off uncertainty over the country’s plan to leave the European Union at the end of March. Retail sales rose 1% in January and were up 4.2% from a year earlier, the Office for National Statistics said on Friday. That was compared to a fall of 0.7% in the previous month, which was revised up from a negative 0.9%.

Wall Street rose as the optimistic trade talk more than offset signs of slower growth in both U.S. earnings and the economy, with the S&P 500 posting a fourth consecutive week of gains. The Dow Jones Industrial Average rose 181.18 points, or 0.7 percent, to 26,031.81, the S&P 500 gained 17.79 points, or 0.64 percent, to 2,792.67 and the Nasdaq Composite added 67.84 points, or 0.91 percent, to 7,527.55. The Dow rose for the ninth consecutive week.

Oil prices touched their highest level in more than three months, supported by OPEC supply cuts as well as the trade developments. New record U.S. oil supply, however, limited gains in post-settle trade. U.S. crude rose 0.37 percent to $57.17 per barrel and Brent was last at $67.00.

Local Market:-

Indian shares ended largely flat on Friday triggered by a worsening global growth outlook, and as losses in financial stocks such as Kotak Mahindra Bank Ltd offset gains in Maruti Suzuki India Ltd. The broader NSE index closed flat at 10,791.65, while the benchmark BSE index ended 0.07 percent lower at 35,871.48. For the week, the NSE index added 0.6 percent, while the BSE index inched up about 0.2 percent.

Kotak Mahindra Bank pared early losses to finish nearly 4 percent weaker on reports that ING Group is looking to sell stake in the private-sector lender via a block deal. Stock posted its lowest closing level in over three weeks. Maruti Suzuki India ended 1.6 percent higher.