Contents. Index Views. SENSEX Index Movers. BSE 200 Index Movers. FII and MF Data. SENSEX Movement. Key Developments India

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2 Contents Index Views SENSEX Index Movers BSE 200 Index Movers FII and MF Data SENSEX Movement Key Developments India Key Developments International Mutual Fund investments are subject to market risks, read all scheme related documents carefully. 2

3 Index Views Last Closing % Change Over 1 week 1 month YTD 1 year NIFTY 7,986 (1.89) (0.59) SENSEX 26,041 (1.69) (0.04) (0.29) 0.74 NSE MIDCAP 14,078 (3.71) (1.79) NSE 500 6,815 (2.32) (0.98) NIFTY JUNIOR 20,798 (3.68) (2.89) BSE SMALLCAP 11,797 (2.61) (0.07) (0.34) 1.06 BSE 200 3,429 (2.24) (0.93) *DOW JONES 19, *NASDAQ 5, NIKKEI 19, HANG SENG 21,575 (2.03) (4.86) (1.55) (2.11) SHANGHAI COMP 3,110 (0.41) (4.04) (12.12) (14.46) BSE OIL & GAS 11,866 (0.25) BSE CAPITAL GOODS 13,489 (2.05) (1.32) (4.53) (4.77) BSE AUTO 19,886 (1.73) BSE FMCG 7,714 (2.11) (1.80) (2.01) (0.92) BSE HEALTHCARE 14,572 (4.25) (5.54) (13.80) (12.82) BSE TECH 5,348 (1.66) 4.22 (11.64) (10.81) BSE IT 9,901 (1.32) 6.25 (10.49) (10.16) BSE BANK 20,428 (2.65) (3.85) BSE PSU 7,587 (2.01) (0.87) BSE REALTY 1,270 (1.08) 1.44 (5.56) (4.92) BSE METALS 9,989 (4.22) (2.49) BSE CONSUMER DURABLES 10,896 (1.40) (0.43) (9.18) (10.09) SOURCE : BLOOMBERG * DENOTES THURSDAY CLOSE 3

4 SENSEX Index Movers Last Price % Change Over 1 week 1 month YTD 1 year Gail India Ltd Cipla Ltd/India (10.28) (9.98) NTPC Ltd HDFC Bank Ltd 1, Tata Consultancy Services Ltd 2, (6.11) (5.38) Tata Steel Ltd 391 (5.64) (0.41) State Bank of India 249 (5.85) (3.67) Sesa Sterlite Ltd 217 (6.01) (0.23) Hindalco Industries Ltd 159 (6.35) (8.13) Axis Bank Ltd 438 (7.26) (8.74) (2.46) (2.98) SOURCE : BLOOMBERG BSE 200 Index Movers Last Price % Change Over 1 week 1 month YTD 1 year Cholamandalam Investment and Finance Co (5.72) Engineers India Ltd Indian Oil Corp Ltd GAIL India Ltd Cipla Ltd/India (10.28) - Adani Power Ltd 29 (9.06) (9.77) (2.51) Cadila Healthcare Ltd 338 (10.17) (13.84) 3.05 (13.76) Piramal Enterprises Ltd 1,474 (13.06) (10.96) Bharat Financial Inclusion Ltd 520 (18.87) (27.28) Divi's Laboratories Ltd 866 (24.87) (26.41) (25.03) - SOURCE : BLOOMBERG 4

5 FII and MF Data (Week Ended ) Rs. Crores FII GROSS PUR 21, FII GROSS SELL 23, FII NET (2,434.38) FII MONTH T0 DATE NET (3,170.74) MF GROSS PUR 6, MF GROSS SELL 3, MF NET 2, MF MONTH T0 DATE NET 2, SOURCE: SEBI SENSEX WEEKLY ,375 26,308 SENSEX LEVEL , ,041 25, SOURCE : BLOOMBERG DATE 5

6 Key Developments India: Go long on the Indian rupee while shorting the Singapore dollar. That s emerging as one of the favorite trades for 2017 as strategists make a play on the diverging outlook for the two Asian nations. Less reliance on exports and one of the world s fastest economic growth rates are seen insulating India from any potential protectionist U.S. policies set forth by the Donald Trump administration. In contrast, tradedependent Singapore, already under pressure from lower energy prices hurting the oil and gas services sector, may feel more pain. Morgan Stanley, Societe Generale and Skandinaviska Enskilda Banken AB are among global banks favoring the rupee against the Singapore dollar. An attractive carry, a strong external balance and falling inflation in Asia s third-largest economy are among reasons Goldman Sachs Group Inc. and Nomura Holdings Inc. say the Indian currency will outperform regional peers. The Singapore dollar faces a number of exogenous risks as a highly-open economy, said Dushyant Padmanabhan, a Singapore-based foreign-exchange strategist at Nomura. Domestic macro conditions also remain weak. On the other hand, India s high currency reserves and potential central-bank intervention to limit volatility make the rupee less vulnerable on external shocks, of which there are potentially several in The rupee will earn 5.9 percent, including interest, by the end of 2017, the highest total return in Asia, according to Bloomberg surveys of strategists. The Singapore dollar is seen handing investors a 0.8 percent return in the period. Three-month implied volatility in the Indian currency, a gauge of expected swings used to price options, has fallen for a third year, slipping 73 basis points in 2016 to 6.02 percent. A similar measure for Singapore s currency has jumped 52 basis points to 7.32 percent, climbing for a fourth year. While Prime Minister Narendra Modi s shock November move to ban high-value currency notes is seen denting consumer demand and weighing on India s economic growth, analysts expect the impact to be transient. Shareholders of Tata Steel Ltd., the flagship company of India s biggest conglomerate, voted to remove independent director Nusli Wadia from its board as Ratan Tata tightens his grip on the business empire his family founded. About 91 percent of the total votes polled, favored the expulsion of Wadia at an extraordinary general meeting in Mumbai on Wednesday, the company said in an exchange filing the following day. Wadia -- chairman of Britannia Industries Ltd. and patriarch of India s oldest conglomerate -- didn t attend the meeting though a letter from him was read to investors. Nusli Wadia: Wadia has sided with Cyrus Mistry since his surprise ouster in October as chairman of Tata Sons Ltd., the holding company of India s largest business group. Tata Steel, the nation s most-indebted steelmaker, has been a lightning rod in the feud between Tata and Mistry as the two traded accusations over missteps at the salt-tosoftware empire. Shareholders will hardly see any returns from the company s 2007 acquisition of Corus Group Plc, which was the largest acquisition by an Indian company at the time, Wadia said in his letter on Wednesday. Investors in Tata Motors Ltd. and Tata Chemicals Ltd. will consider Wadia s position on their boards this week. Mistry himself resigned as director of Tata group companies on the eve of the shareholder meetings to remove him and filed a case with the National Company Law Tribunal. Bankers are pinning hopes on merger and acquisition deals, as Indian companies become more ambitious globally, to boost the nation s offshore loan volumes in Event-driven financing, which includes M&A loans, swelled to a five-year high of $3.53 billion in 2016, compared with $117 million in 2015, largely driven by the nation s energy companies purchasing oil assets abroad, according to data compiled by Bloomberg. In comparison, refinancing deals fell 29 percent to $10.8 billion, while project finance and 6

7 capex rose to $3.68 billion, from $2.90 billion. Event-driven loan volumes this year were bolstered by stateowned energy borrowers including Indian Oil Corp., Oil & Natural Gas Corp. and Oil India Ltd. rising dollar funding to buy equity stakes in the Taas-Yuriakh and Vankor oil fields in Siberia from Russia s Rosneft PJSC. Refinancing remained the largest driver for offshore loans, drawing the nation s largest companies including Aditya Birla Group, ONGC and Reliance Industries Ltd. The next theme to watch out for is acquisition-driven financing, with pharmaceutical and technology companies especially seeking to raise loans to expand abroad, said Sameer Chandra, a director for loan syndications at Citi India in Mumbai. A key takeaway from 2016 was that a lot of mid-sized companies have shown the strategic courage to make transformational acquisitions overseas. National Stock Exchange of India Ltd. plans to include all relevant details from Deloitte s audit of its highfrequency trading system in its initial public offering prospectus, according to Chairman Ashok Chawla. NSE expects to file the IPO draft prospectus by the end of the month, Chawla said in a phone interview. Deloitte s review, which looks at operations from the years 2010 to 2014, will be submitted to India s market regulator before then, he said. The findings of the audit won t lead to immediate changes in the exchange s systems. Ashok Chawla: A resolution of the HFT investigation will clear a major roadblock for NSE s initial share sale, worth about 100 billion rupees ($1.5 billion), in the nation s biggest listing in more than six years. The Securities & Exchange Board of India told NSE to hire an external agency to look into its HFT systems in September after the agency s advisory committee recommended a review of whether exchange officials granted unfair access to traders, according to a copy of an internal report seen by Bloomberg News. The exchange is well-run and there is no need to change the current management structure, Chawla said, NSE said that Chief Executive Officer Chitra Ramkrishna had resigned for personal reasons and subsequently said it is on the hunt for a new CEO. Group President J. Ravichandran was appointed interim CEO, according to the statement. Stung in part by the outcry over the NSE claims, SEBI issued draft rules in August to try to ensure high-speed firms didn t get an unfair advantage in India s stock market. Among the proposals were a fraction-of-a-second speed bump, alternating trades between different types of orders and a mechanism to prevent traders from canceling an order until it is confirmed by the exchange. The rules are still being reviewed by SEBI and haven t been implemented. International: The U.K. current-account deficit widened in the third quarter as Britain posted its worst trade performance in almost three years. The difference between money coming into the U.K. and money sent out was 25.5 billion pounds ($31.3 billion), the Office for National Statistics said on Friday. That s equal to 5.2 percent of gross domestic product. The trade deficit widened to 2.8 percent, the most since the fourth quarter of The current-account deficit is forecast to be double that of the U.S. this year at more than 5 percent of GDP but concern has been partly allayed by the weaker pound, which is expected to boost exports and reduce spending on imports. Economists see the gap narrowing to about 4 percent in 2017, making Britain less reliant on the willingness of foreigners to keep buying U.K. assets. The economy is showing resilience to the Brexit vote so far, with separate figures showing GDP grew 0.6 percent in the third quarter, the same as in the second quarter and more than previously estimated. Consumers once again drove the expansion, offsetting the biggest drag from trade since The performance may further encourage pro-brexit campaigners to push for a complete withdrawal from the European Union and the single market. The economy is strong, and since Brexit has remained strong, Patrick Minford of Cardiff Business School, cochairman of the Economists for Brexit group, said. It will get stronger. The free-trade agenda is designed to strengthen the British economy, contrary to all the propaganda about soft Brexit, staying in the single market. Corrections to trade data meant the current-account deficit was smaller than previously thought over recent quarters. It peaked at 5.5 percent of GDP in the fourth quarter of 2015 instead of 7 percent. 7

8 Donald Trump and Republican lawmakers have made no secret of their desire to remove shackles put on banks by the Dodd-Frank Act, and taking an axe to the Consumer Financial Protection Bureau is one of their top priorities. But transforming stump speeches that vilified Elizabeth Warren s favorite regulator into actual change is easier said than done for a variety of reasons. They include disagreements among Republicans about how far to go and opposition to blowing up the CFPB from an unlikely source: bankers. Trump s transition advisers already are evaluating ways to legally fire CFPB Director, Richard Cordray, according to people familiar with the matter. If they move forward with such a plan, many Republicans want Trump to replace him with someone committed to dismantling the agency. In Congress, another aggressive tactic being considered is forcing through an overhaul of CFPB funding so lawmakers can starve it of money. Such scorched-earth strategies pose risks. Some Republican congressional aides and bank lobbyists privately say a hard-line approach on the CFPB will alienate Democrats, jeopardizing any chance of persuading moderates to compromise on a broader overhaul of the Dodd-Frank Act. To make big changes, Trump will probably need the support of at least eight Senate Democrats to overcome procedural hurdles that can be used to block legislation. There are all sorts of risks, said Iain Murray, vice president of strategy at Competitive Enterprise Institute, a public policy group that advocates for limited government. If a change in the CFPB director comes to symbolize the bigger fight over Dodd-Frank, there are going to be trade-offs. NEWS SOURCE: BLOOMBERG CL03969 Risk Factor: Mutual Fund investments are subject to market risks, read all scheme related documents carefully. Disclaimer: The article (including market views expressed herein) is for general information only and does not have regard to specific investment objectives, financial situation and the particular needs of any specific person who may receive this information. Investments in mutual funds and secondary markets inherently involve risks and recipient should consult their legal, tax and financial advisors before investing. Recipient of this article/ information should understand that statements made herein regarding future prospects may not be realized. He/ She should also understand that any reference to the securities/ sectors/ issuers etc., in the document is only for illustration purpose and are NOT stock recommendations from the author or L&T Investment Management Limited, the asset management company of L&T Mutual Fund or any of its associates. Any performance information shown refers to the past should not be seen as an indication of future returns. The value of investments and any income from them can go down as well as up. 8