[Type text] Daily Market Report 28 th Oct 15 Research Team IFA Global
Domestic and International Highlights Indian rupee opened at 65.07 after closing the previous session at 64.97 levels. The intra-day range is seen between 64.85-65.15 levels. India Inc's external borrowings down 32% at 2.6 bn in Sept External commercial borrowings (ECBs) by Indian firms declined by 32% to USD 2.61 billion in September, according the Reserve Bank data. The borrowings were at USD 3.18 billion in the same month last year. However, ECBs raised by Indian firms in August this year were significantly lower at USD 750.77 million, as per RBI data. Of the total amount raised during last month, USD 1.48 billion was through approval route, while USD 1.13 billion came via automatic route. China to invest $315-billion pension fund in stock market in 2016 China said it will invest a whopping $315 billion of its pension fund in stocks and equities next year as the government makes rules to minimize the risk in the country's volatile stock market that recently faced biggest crash. Officials are exploring how best to transfer funds from local governments to the provincial level and allocating funds to authorized institutions for investment. China's cabinet had finalized guidelines in August allowing pension funds to be invested in higher-return products, including stocks and equities Easier trade can push global exports, says WTO According to WTO, the implementation of the Trade Facilitation Agreement (TFA) has the potential to increase global merchandise exports by up to $1 trillion per annum, with developing countries expected to capture more than half of these gains. The report pegs the overall boost to global GDP growth at 0.5% per annum as the agreement aims to standardize, streamline and speed up customs processes around the world, helping to expedite the movement, release and clearance of goods. Indian 10 Year Bond Yield Indian government bonds open slightly higher as lower crude oil prices boost hopes of softer inflation in coming months, with benchmark bond trading at Rs. 100.81, yielding 7.60%, against INR100.77 previous close. Brent crude oil is trading near lowest since September 15 amid supply glut. Bonds rose for first time in seven sessions yesterday on value buying with Fed's policy decision later today to give further cues to market.
USD/INR Daily Chart Source: Reuters Technical Outlook The USD/INR pair has reversed after taking support at 61.80% Fibonacci retracement. We are observing a bullish hidden divergence suggesting strength in the pair. Overall Outlook & Strategy Trend: The USD/INR pair is trading in the range of 64.85-65.25 levels. A break above 65.25 levels will pave the way to 65.80 levels. USD/INR pair will take further cues from the FOMC meet outcome. Exporters are advised to cover around 65.40-80 levels. (They are suggested to discuss their positions with their respective advisors). Importers were advised to cover at levels of 64.75-80. (They are suggested to discuss their positions with their respective advisors). Short term range (7-15 days): 64.70-65.80 Medium term range (3-6 months): 64.50-68.25
Glance at G7 EUR / USD The Euro continued to trade with caution just above the 1.1000 handle as traders stayed away before the FOMC outcome. Euro is likely to trade range bound as economic calendar remains light in the European session. GBP / USD The GBP/USD fell slightly yesterday after the release of UK s preliminary GDP data for Q3. The pair will take further cues from the FOMC statement due today. AUD / USD The AUD/USD pair came off highs as Aussie CPI numbers unexpectedly missed estimates. The CPI came in at 0.5% vs an expectation of 0.7%. The pair came under pressure as dip in CPI raised hopes of further easing from RBA. USD/ JPY The USD/JPY pair continues to trade in ranges as traders remain on sidelines awaiting the crucial FOMC statement as well as the Bank of Japan monetary policy meeting. The pair is expected to stay range bound ahead of big events. Gold The Gold retained small overnight gains, but caution prevailed ahead of a Federal Reserve policy statement later in the session as investors waited for clues on the timing of a U.S. rate hike. Many traders chose to stick to the sidelines ahead of a Fed statement following a two-day policy meeting. Crude WTI Crude Oil prices slid to two-month lows on expectations that U.S. crude stockpiles grew for the fifth straight week last week. The U.S. Energy Information Administration is due to release weekly inventory data later today. Dollar Index The US dollar index, which spiked to near its two month high levels on weaker Euro, eased slightly ahead of the crucial FOMC meeting. US Fed is expected to keep interest rates at record low today as well. The tone of Fed policy statement will set the tone for further direction in Dollar index.
Economic Calendar Date 26-Oct-Mon 27-Oct-Tue 27-Oct-Tue 27-Oct-Tue 28-Oct-Wed 28-Oct-Wed 29-Oct-Thus 29-Oct-Thus 30-Oct-Fri 30-Oct-Fri Description EUR German Ifo Business Climate GBP Prelim GDP q/q USD - Core Durable Goods Orders m/m USD CB Consumer Confidence AUD CPI q/q USD FOMC Statement USD Advance GDP q/q USD Unemployment Claims JPY BOJ Outlook Report USD Employment Cost Index q/q
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