Financial Market Overview
20th December, 2018
- The Indian rupee rose for a fourth straight session against the dollar to a near-three-week high, helped by likely corporate dollar inflows and the greenback’s plunge to a one-month low post the Federal Reserve’s policy. The rupee settled at 69.70 to a dollar, its highest since Nov. 30, and against 70.40 at previous close. It opened lower at 70.68, before turning higher and rising as much as 1.1% to an intraday high of 69.66 per dollar.
- However, it trimmed some gains on likely dollar purchases by at least two state-run banks, possibly on the instructions of the Reserve Bank of India, three dealers told NewsRise. Some foreign banks also covered their short dollar positions.
- Benchmark indices erased most of its losses and ended near day’s high with Nifty closed above 10,950 level.
- At the close the Sensex was down 52.66 points or 0.14% at 36431.67, while Nifty was down 15.60 points or 0.14% at 10951.70. About 1218 shares have advanced, 1344 shares declined, and 167 shares are unchanged.
- HDFC Bank, HDFC, Infosys, ITS and Kotak Mahindra Bank are the positive contributors to the Sensex.
- A disappointing rate outlook from the Federal Reserve dragged European shares down sharply on Thursday with several benchmark indexes hitting two-year lows on worries tighter monetary conditions could further weigh on sluggish economic growth. The pan-European STOXX 600 index fell 1.1 percent, while Britain’s FTSE 100 and France’s CAC indexes fell 1.4 and 0.9 percent respectively, having all hit their lowest levels since at least December 2016.
- S. stocks declined sharply on Wednesday after the Federal Reserve’s forecast of fewer interest-rate increases in 2019 fell short of investors’ hopes of a more dovish monetary policy. The Dow Jones Industrial Average fell 351.98 points, or 1.49 percent, to 23,323.66, the S&P 500 lost 35.48 points, or 1.39 percent, to 2,510.68, and the Nasdaq Composite dropped 140.80 points, or 2.08 percent, to 6,643.11.
- After weeks of market volatility and calls by President Donald Trump for the Federal Reserve to stop raising interest rates, the U.S. central bank instead did it again, and stuck by a plan to keep withdrawing support from an economy it views as strong. U.S. stocks and bond yields fell hard. With the Fed signaling “some further gradual” rate hikes and no break from cutting its massive bond portfolio, traders fretted that policymakers could choke off economic growth.
- The dollar fell to a one-month low on Thursday on growing concerns that U.S. policymakers may be raising interest rates just as the world’s biggest economy faces a slowdown. While the Federal Reserve raised interest rates for the fourth time in a year and officials signalled they may hike three more times by early 2020, bond markets marked increased expectations the U.S. economy may be running out of steam economies as “good” posting its largest decline since 2000.