Nov 03 2018

Rupee posted its biggest weekly gain in nearly 20 months

Weekly Synopsis

Date:- 03rd November 2018

Markets from 29th October 2018 to 02nd November 2018:- 

Indian Rupee:-

The Indian rupee was the second-best performer in Asia, rising the most in over five years on Friday, on lower global oil prices and as China and the United States expressed optimism about resolving their bruising trade war.

The Rupee also posted its biggest weekly gain in nearly 20 months, for the week Rupee gains 1.39% and the single currency closed on Friday at 72.4350 against the previous weekly close of 73.4550 on Oct 26th, 2018 to a Dollar. It trades in a weekly range between 74.14 to 72.4250 against the greenback.

India’s foreign exchange reserves fell to $392.08 billion as of Oct 26, compared with $393.52 billion a week earlier, the Reserve Bank of India said on Friday.

Global Market:- 

The dollar rose against the yen and the euro on Friday in a choppy session, as worries that a trade deal between the United States and China may not be imminent curtailed risk appetite and boosted safe-haven demand for the greenback. The dollar index, which tracks the greenback versus the euro, yen, sterling and three other currencies, was up 0.25 percent at 96.519. It hit a 16-month high on Wednesday.

U.S. job growth rebounded sharply in October and wages recorded their largest annual gain in 9-1/2 years. The Labor Department’s closely watched monthly employment report on Friday also showed the unemployment rate was steady at a 49-year low of 3.7 percent as 711,000 people entered the labor force.

Nonfarm payrolls increased by 250,000 jobs last month as employment in the leisure and hospitality sector bounced back after being held down by Hurricane Florence, which drenched North and South Carolina in mid-September. The economy created 118,000 jobs in September. Economists polled had forecast payrolls would increase by 190,000 jobs in October.

The U.S. trade deficit rose to a seven-month high in September. The Commerce Department said on Friday the trade gap increased 1.3 percent to $54.0 billion, widening for a fourth straight month. Data for August was revised to show the trade deficit rising to $53.3 billion instead of the previously reported $53.2 billion.

Activity in the UK construction sector accelerated last month, according to a closely watched business survey released on Friday. Research firm Markit said its construction purchasing managers’ index rose to 53.2 in October, compared to forecasts for a reading of 52.0.The prior month’s reading was 52.1.

The Bank of England left interest rates unchanged on Thursday, in what was a widely anticipated decision, and indicated that any more hikes will be at a gradual pace as it monitors developments with ongoing Brexit negotiations between the UK and the European Union. The BoE’s Monetary Policy Committee voted unanimously to hold rates steady at 0.75%.

Inflation in the euro zone accelerated in October, underlining the European Central Bank’s case for winding up its asset purchase program at the end of this year. The bloc’s statistics agency Eurostat said its consumer price index rose at an annual rate of 2.2% in October, accelerating from 2.1% in September. Analysts had expected a reading of 2.1%.

Growth in the euro area economy slowed in the third quarter, according to a preliminary estimate released on Tuesday, adding to fears that the bloc’s economy is losing momentum. Eurostat said the euro area economy grew by just 0.2% in the third quarter, halving from 0.4% in the previous quarter. Economists had been expecting growth of 0.4%.

U.S. stocks were lower after the close on Friday, as losses in the Technology, Healthcare and Utilities sectors led shares lower. The Dow Jones Industrial Average fell 109.91 points, or 0.43 percent, to 25,270.83, the S&P 500 lost 17.31 points, or 0.63 percent, to 2,723.06 and the Nasdaq Composite dropped 77.06 points, or 1.04 percent, to 7,356.99.

Oil prices fell about 1 percent on Friday and notched a weekly loss of over 6 percent, as investors worried about oversupply after the United States said it will temporarily spare eight jurisdictions from Iran-related sanctions. Brent crude futures fell 6 cents to settle at $72.83 a barrel. U.S. crude declined 55 cents to end the session at $63.14 per barrel, a 0.86 percent loss.

European markets finished mixed as of the most recent closing prices on Friday. The DAX gained 0.44% and the CAC 40 rose 0.32%. The FTSE 100 lost 0.29%.

Local Market:-

Indian shares climbed on Friday and clocked their best weekly gain in nearly two-and-a-half years, as the rupee rose the most in more than five years and as crude prices softened.

The broader NSE index ended 1.66 percent higher at 10,553, while the benchmark BSE index closed 1.68 percent higher at 35,011.65. The NSE index closed 5.21 percent higher for the week while the BSE index added 4.98 percent.

Housing Development Finance Corporation Ltd was the top boost to the NSE index, rising 3.5 percent to its highest close since Sept. 21. HDFC Bank Ltd rose 2 percent while oil-to-retail conglomerate Reliance Industries was up 1.8 percent.