Nov 18 2017

Rupee posts weekly gain on Moody’s rating upgrade

 Weekly Synopsis


Date:- 18th November 2017


Markets from 13th November 2017 to 17th November 2017:-


Indian Rupee:-


  • The Indian rupee posted a weekly gain against the dollar, helped by a boost in domestic sentiment after Moody’s Investors Service upgraded the country’s sovereign credit rating for the first time in about 14 years. On a weekly basis, the currency rose 0.23%. The rupee closes on Friday at 65.01 against the previous weekly close of 65.16 on November 10th, 2017 to a greenback. It trades in a weekly range between 65.5425 to 64.62 against the greenback.


  • Moody’s Investors Service on Friday raised the sovereign credit rating of the country to investment-grade Baa2 from Baa3 and revised the outlook to stable from positive.


  • India’s foreign exchange reserves rose for the first time in four weeks to $399.29 billion as of Nov. 10, from $398.74 billion in the previous week, the central bank said yesterday. The increase was driven by a rise in foreign currency assets to $374.88 billion from $374.32 billion in the previous week, according to data from the Reserve Bank of India. Foreign exchange reserves had hit a record high of $402.51 billion as of week ending Sep.15.


  • India’s retail inflation edged up 3.58% in October from a year earlier, the fastest pace of growth since March, as food and fuel prices increased at a faster pace, government data showed today. A  survey of economists had expected October inflation rate to quicken to 3.46% from September’s print of 3.28%.


  • India’s merchandise exports fell 19.29% to $23.09 billion in October from the previous month, the first fall in two months, dragged down by lower shipment of engineering goods and gems and jewellery, government data showed on 14 November 2017. Imports fell 1.27% to $37.12 billion in October from $37.60 billion in September, according to the data. Merchandise exports fell 1.12% in October, while imports rose 7.60%, year on year.  Trade deficit widened to $14.02 billion in October, the highest since November 2014, from $8.98 billion in the previous month. The gap was at $11.13 billion in the same month a year earlier.


  • India’s wholesale price inflation rose 3.59% in October from a year earlier, recording the fastest pace of gain since April, driven by costlier food items, including a sharp surge in onion prices, government data showed on Tuesday. The October reading was faster than an annual 2.6% increase in the previous month, and topped a median forecast for a 3.01% annual increase in a poll of economists.


Global Market:-


  • The dollar fell against a basket of other major currencies on Friday, as Treasury yields slipped and investors remained skeptical of U.S. Republicans’ efforts to pass tax cuts after a barren first year for the Trump administration in Congress. The dollar index , which measures the greenback against six rival currencies, was down 0.31 percent to 93.645. For the week, the index was down 0.8 percent. The euro EURwas up 0.23 percent to $1.1796. The greenback was down 0.82 percent against the Japanese yen.


  • S. Treasury yields edged lower, in line with declines in U.S. stock indexes and German 10-year bond yields, as risk appetite faded. The yield curve continued to flatten after strong U.S. housing starts data for October and investors bet on further rate hikes from the Federal Reserve.


  • The U.S. House of Representatives voted in favor of its version of a tax overhaul bill that would cut corporate taxes on Thursday. But then investors’ focus turned to the Senate’s battle over its rival bill and worries about whether the House and Senate will ever agree on a compromise.


  • S. homebuilding jumped to a one-year high in October as disruptions caused by recent hurricanes in the South faded and communities in the region started replacing houses damaged by flooding. The sharp rebound in home construction reported by the Commerce Department on Friday was also driven by robust gains in the Northeast and Midwest regions. Housing starts surged 13.7 percent to a seasonally adjusted annual rate of 1.29 million units. That was the highest level since October 2016 and also the second-best reading in 10 years. September’s sales pace was revised up to 1.135 million units from the previously reported 1.127 million units.


  • Data released on Tuesday showed, Germany’s seasonally adjusted gross domestic product (GDP) rose by 0.8% on the quarter, against a poll expectation of 0.6%.


  • Wall Street ended the week on a sour note on Friday, with major indexes slipping modestly as investors weighed the fate of the Republicans’ tax overhaul plan. The Dow Jones Industrial Average fell 100.12 points, or 0.43 percent, to 23,358.24, the S&P 500 lost 6.79 points, or 0.26 percent, to 2,578.85 and the Nasdaq Composite dropped 10.50 points, or 0.15 percent, to 6,782.79.


  • European shares closed lower on Friday, with regional indexes posting their second weekly fall in a row. The STOXX 600 was down 0.3 percent at its close, taking losses so far this week to 1.3 percent, its second negative week in a row. The pan-European benchmark index is still up more than 6 percent so far this year. The DAX is down 0.41% while France’s CAC 40 is off 0.32% and London’s FTSE 100 is lower by 0.08%.


Local Market:-


  • Indian shares ended higher on Friday after climbing more than 1 percent during the session, after Moody’s Investors Service upgraded India’s sovereign bond rating for the first time in nearly 14 years.


  • The broader NSE index closed 0.67 percent higher at 10,283.60, while the benchmark BSE index finished 0.71 percent up at 33,342.80.


  • Financials led the gains, with Housing Development Finance Corp Ltd  rising 2.9 percent and ICICI Bank Ltd  ending 1.8 percent higher. For the week, the NSE index declined 0.4 percent, while the BSE index ended flat.