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Daily Updates
Fri,19 Jan 2018

  • Indian equity markets extended the rally with buying interest seen in banking stocks following reports of the government’s plan to increase in foreign direct investment in banking sector. According to media reports, the government is considering raising the foreign investment ceiling in private banks to 100% and in public lenders to 49%.

  • Key benchmark indices S&P BSE Sensex and Nifty 50 rose 0.51% and 0.26% to close at 35,260.29 and 10,817.00, respectively. Meanwhile, broader indices bucked the trend with S&P BSE Mid-Cap and S&P BSE Small-Cap falling by 1.69% and 2.04%, respectively.

  • The market breadth on BSE was weak with 2,301 scrips declining and 663 advancing. A total of 122 scrips remained unchanged.

  • On the BSE sectoral front, majority of the indices closed in the red. S&P BSE Realty was the major loser, down 4.07%, followed by S&P BSE Metal and S&P SBE Telecom, which slipped 2.87% and 2.63%, respectively. S&P BSE Basic Materials and S&P BSE Utilities fell 2.12% and 1.98%, respectively. Meanwhile, S&P BSE FMCG was the top gainer, up 0.74%, followed by S&P BSE Bankex, S&P BSE Finance and S&P BSE IT, that rose 0.69%, 0.56% and 0.13%, respectively.
Domestic Indices Performance   
  18-Jan-18 1D % Chg 1M % Chg 1Yr % Chg
Nifty 50 10,817 0.26 4.12 28.51
S&P BSE Sensex 35,260 0.51 4.94 29.36
S&P BSE Midcap 17,629 -1.69 3.07 38.49
S&P BSE Smallcap 19,286 -2.04 5.66 49.70
S&P BSE Auto 25,974 -0.22 0.45 21.68
S&P BSE Bankex 30,017 0.69 3.78 36.62
S&P BSE CD 23,522 -1.02 5.86 92.42
S&P BSE CG 20,014 -0.62 8.49 36.04
S&P BSE FMCG 10,818 0.74 2.50 27.99
S&P BSE HC 14,804 -1.13 4.65 -1.71
S&P BSE IT 12,200 0.13 11.87 23.29
S&P BSE Metal 15,127 -2.87 7.11 32.55
S&P BSE Oil 15,747 -1.38 -3.58 26.84
S&P BSE Power 2,352 -1.80 3.64 9.86
S&P BSE PSU 8,999 -1.67 -1.94 10.36
S&P BSE Realty 2,590 -4.07 8.91 87.66
S&P BSE Teck 6,763 -0.25 9.34 25.36
VIX Index 14 0.72 6.44 -8.05
  • Bond yields inched up as market participants remained on the sidelines ahead of the weekly debt auction due on Jan 19, 2018.

  • Yield on the existing 10-year benchmark paper (6.79% GS 2027) rose 5 bps to close at 7.47% as against previous session close of 7.42%. During the session, bond yields traded in the range of 7.43% and 7.48%.

  • Yield on the new 10-year benchmark paper (7.17% GS 2028) rose 4 bps to close at 7.26% as against previous session close of 7.22%. During the session, bond yields traded in the range of 7.23% and 7.28%.

  • Banks’ borrowings under the repo window of the Liquidity Adjustment Facility (LAF) stood at Rs. 2,530 crore (gross) on Jan 18 as compared with Rs. 2,980 on Jan 17. Sale of securities under Reserve Bank of India’s (RBI) reverse repo window stood at Rs. 29,080 crore on Jan 17.

  • Banks did not borrow under Marginal Standing Facility on Jan 17 and Jan 16.
Daily Rates    
Key Rates (%) 18-Jan-18 Previous Close Year Ago
10 Yr Gsec 7.47 7.42 6.45
5 Yr AAA Corp Bond 7.77 7.73 7.13
3 Yr AAA Corp Bond 7.65 7.64 6.88
1 Yr AAA Corp Bond 7.40 7.40 6.69
3 Yr AA Corp Bond 8.07 8.06 7.38
1 Yr AA Corp Bond 7.70 7.70 7.16
12 Month CD 7.31 7.27 6.56
3 Month CD 6.98 6.96 6.39
CALL 5.90 5.86 6.00
CBLO 5.86 5.88 6.03

 

Institutional Flows     
(INR Cr) FII Flows MF Flows1
As on January 18,2018 Debt Equity Debt Equity
Purchases 2,374 7,935 5,134 3,869
Sales 2,662 7,126 5,078 3,325
Net -288 809 56 544
MTD Net 1660 3851 14401 4588

1 As on January 17,2018

  • Straits Times - The index moved down for the two-consecutive trading session and it fell 0.58%. However, positive cues from overnight U.S. markets limited the downside.
  • Nikkei - The index fell 0.44%, after Japan's industrial production increased less than estimated in Nov 2017. However, positive cues from overnight U.S. markets limited the downside.
  • Hang Seng - The index gained 0.43% following positive cues from the Chinese market. Some of the improved Chinese economic data and fall in Hong Kong’s unemployment data in Dec 2017 also helped gains.
  • FTSE - The index fell 0.32% due to currency strength that continued to weigh on shares of exporters. However, losses were capped as mining stocks gained amid strong Chinese GDP data for 2017. Also, gains in technology stocks on a few strong corporate results boosted the indices.
  • Dow Jones - The index fell 0.37% amid concerns over potential government shutdown at the end of the week. Also, steep drop in new residential construction in Dec 2017 and decline in initial jobless claims for the week ended Jan 13, weighed on market sentiment.
Global Indices Performance   
Global Indices 18-Jan-18 1D % Chg 1M % Chg 1Yr % Chg
Dow Jones 26,018 -0.37 4.94 31.37
Nasdaq 100 6,811 0.02 4.58 34.72
FTSE  7,701 -0.32 2.18 6.26
Straits Times 3,521 -0.58 3.12 17.37
Nikkei 23,763 -0.44 3.76 25.77
Hang Seng 32,122 0.43 10.57 39.07
Shanghai Composite 3,475 0.87 6.33 11.62
  • Gold prices gained as investors remained focused on upcoming U.S. data which will provide further cues on Federal Reserve’s rate hikes decision in Mar and development over probable U.S. government shutdown.

  • Brent crude prices inched up after the American Petroleum Institute data indicated that U.S. oil inventories dropped by nearly 5.1 million barrels in the week ending Jan 12.
Commodity Market    
Commodity (INR) 18-Jan-18 1D % Chg 1M % Chg 1Yr % Chg
Brent (1 barrel) (in $) 69.62 0.56 7.41 30.35
Gold (10 gm) 29,891 -0.67 4.68 2.36
Silver (1 kg) 38,763 -0.82 5.13 -6.25
Aluminium (1 kg) 142.00 1.50 8.19 16.11
Copper (1 kg) 449.80 -0.61 1.55 14.22
  • The Indian rupee inched up against the greenback as gains in the domestic equity market were almost neutralized by dollar demand from oil importers.

  • The euro rose against the dollar as the latter remained under pressure on growing possibility that central banks across the globe will begin to move toward tighter monetary policy amid a more synchronised global recovery.
Currency Market    
Currency 18-Jan-18 1D % Chg 1M % Chg 1Yr % Chg
USD/INR 63.84 -0.21 -0.41 -6.03
EURO/INR 77.88 -0.60 3.25 7.28
GBP/INR 88.28 0.18 3.20 5.30
100 JPY/INR 57.41 -0.57 0.90 -4.27
  • The Goods and Services Tax (GST) council in its meeting put 29 handicraft items in 0% slab. GST rates have also been reduced on few agricultural products and 53 categories of services. The new rates are applicable from Jan 25, 2018. The council also decided that Rs. 35,000 crore of integrated GST will be provisionally divided between the central government and the state government. The GST council also cut tax rate on domestic LPG by private companies to 5% from 18% earlier. However, decision on whether to include real estate and petroleum products under GST have not been taken. This decision is expected to be taken in the next meeting.

  • According to the Power Minister, the government will set up a $350 million fund to finance solar projects. The objective of the move is to achieve its ambitious target of adding 175 gigawatts (GW) in renewable energy by 2022. The minister on a separate note added that the government would be able to achieve its target of 175 GW of installed renewable energy capacity well before 2020
Key Economic Indicators   
Indicators Current Previous
GDP 6.30% (Q2 FY'18) 5.70% (Q1 FY'18)
IIP 8.40% (Nov'17) 2.00% (Oct'17)
WPI 3.58% (Dec'17) 3.93% (Nov'17)
CPI 5.21% (Dec'17) 4.88% (Nov'17)

Since May-17, MOSPI has revised base year of IIP & WPI from 2004-05 to
2011-12, and for CPI from 2010 to 2012

Policy Rates    
Key Rates (%) Current Previous
Reverse Repo 5.75 5.75
Repo 6.00 6.00
CRR 4.00 4.00
SLR 19.50 19.50
Bank Rate 6.25 6.25



  • According to Moody’s Investors Services, Reliance Jio may invest as much as $23 billion on capital spending over three to four years as it expands beyond wireless services.

  • According to media reports, UltraTech Cement Ltd posted a 23% drop in third-quarter profit due to rising pet coke and coal prices. Profit fell to Rs 4.56 billion ($71.4 million) for the quarter ended Dec 31, from Rs 5.95 billion a year ago.

  • According to media reports, YES Bank’s third-quarter net profit grew 22% to Rs. 10.76 billion in the quarter ended Dec 31, 2017, compared with Rs. 8.82 billion in the same period of the previous year.

  • According to media reports, the net profit of India’s Hindustan Zinc fell by nearly 4% to Rs. 22.30 billion in the quarter ended Dec 31, 2017 from Rs. 23.20 billion in the same period of the previous year.
Upcoming Events  
Event Date
Forex Reserves 19-Jan-18

Source :ICRON Research

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