Sensex, Nifty sluggish; SBI down 2%, auto stocks rise

bear-marketThe market is sluggish with the Nifty hovering around 7950. The 50-share index is up 28.25 points or 0.4 percent at 7957.35 and the Sensex is up 56.65 points or 0.2 percent at 25821.79. About 1048 shares have advanced, 1346 shares declined, and 169 shares are unchanged.

Auto stocks are rising with Bajaj Auto, Hero MotoCorp and Maruti leading the pack. HUL and Adani Ports are other gainers in the Sensex. Among losers are BHEL, SBI, L&T, GAIL and NTPC.

The rupee slipped from its initial recovery, dropping 7 paise to Rs 68.23 in late morning deals following bouts of dollar demand from importers despite higher domestic equities.

Overseas, the US dollar took a breather against basket currencies in early Asian trade, as investors consolidated the gains built on expectations of increased fiscal spending and higher inflation under a Trump administration.

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After Rs. 500 Note Launch, Withdrawal Limits At ATMs, Banks Raised: 10 Updates

bank-atm-currency-ban_650x400_51479052192NEW DELHI:  Within hours of launching the new Rs. 500 notes on Sunday, the government increased the daily limit of withdrawal from ATMs from Rs. 2000 to Rs. 2500 and exchange limit from Rs. 4,000 to Rs. 4,500. Prime Minister Narendra Modi held a meeting to review the withdrawal of Rs. 500 and Rs. 1000 notes that was announced on Tuesday in a bid to root out black money. Union minister Arun Jaitley and the Deputy Governor of the Reserve Bank of India attended the meeting.

Here are the latest developments:
1.The finance ministry has asked the banks to remove the daily withdrawal limit of Rs.10,000 and increase the weekly withdrawal limit of Rs. 20,000 to Rs. 24,000, so that the entire amount can be withdrawn at one time by cheque. The banks have also been advised to make arrangements for separate queues for senior citizens and people with disabilities.
2. After Sunday’s late night cabinet meeting – headed by PM Modi – the limit for exempted transactions was extended till November 24 midnight. Old Rs. 500 and 1,000 notes will be accepted at government hospitals, petrol pumps and toll booths till November 24, Economic Affairs Secretary Shaktikanta Das said.
3.PM Modi on Sunday said the nation had elected him to fight corruption and he was ready to do even though he faced a threat to his life. “I know the forces up against me, they may not let me live… they may ruin me because their loot of 70 years is in trouble, but am prepared,” he said at a function in Goa.
4.The Congress said PM Modi had insulted the people who are standing in queues. “Wage earners, farmers, weavers, construction workers… PM has said all these millions of Indians are scamsters. The PM should give up theatrics and think hard how to improve the country’s direction,” said party spokesperson Anand Sharma.
5.The Reserve Bank of India has urged people to not withdraw cash repeatedly and hoard it. Much to people’s dismay, only 60 per cent of ATMs got currency feed five days after PM Modi announced the surprise scrapping of notes. Of the 2 lakh ATMs across the nation, 1.2 lakh are running but they are out of cash within a few hours.
6.Bigger crowds were witnessed outside banks and ATMs this morning since most people are off work; the rush was also, in part, due to banks being closed on Monday in some parts of the country. In Delhi, to manage anxious crowds, 3,400 paramilitary personnel and Delhi Police along with 200 quick reaction teams were deployed at ATMs and banks.
7.Delhi chief minister Arvind Kejriwal, who has criticised the government’s move to ban the high denomination currency, told NDTV that those standing in long lines have no black money. The government, he said, had alerted its own people.
8.Bengal Chief Minister Mamata Banerjee called up arch rival CPM’s Sitaram Yechury, asking him to join hands in the fight the governemnt’s move and call on President Pranab Mukherjee together. According to sources, Mr Yechury said he would revert in a couple of days.
9.The nation’s largest bank, the State Bank of India, got deposits worth Rs. 75945 crore by Sunday evening.
10.The government had launched the new Rs. 2000 notes last week. But neither that, nor the Rs. 500 notes can be stacked in ATM machines due to a mismatch in tray size. “Recalibration of ATMs will be completed within two weeks,” Union finance minister Arun Jaitley had said on Saturday.The government has asked people to exchange old 500 and 1,000 rupees notes by December 30.

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Impact on US Election outcome on Indian markets: Saravana Kumar, LIC MF

trumpImpact on Indo-US trade – Indian IT and Pharma sector to take a hit
A likely impact of the US Presidential elections would be a reduction in the quota for H1B  visa as both Hillary Clinton and Donald Trump are likely to push for immigration reforms. A reduction in the quota for H1B visa will impact the Indian IT companies as they send their employees to work on-site in US. Trump has already said that he wants to bring back jobs lost to outsourcing. This could negatively impact the Indian IT sector, which gets about 60 percent of its $110 billion yearly revenue from the US.

The Indian Pharma industry has a stronghold in the US, the world’s largest pharmaceutical market and  the US  Presidential elections will have a significant impact as exports are likely to fall. The Indian Pharma sector will see pricing pressures. Both US Presidential candidates have favored tighter pricing regulations. Hillary has talked about cutting drug price, while Trump has advocated repealing Obamacare.Drug  prices are expected to fall  in the US, hitting profit margins of many Indian pharma companies .

Impact of US elections on Indian Financial Markets

Equity: Trump victory in the US would have a negative impact on India. Signs  of the same are already visible. Asian stocks were trading largely in the red this morning. Key share indices gave up opening gains and were lower as the lead of Trump widened in the key state of Florida. Nikkei (-5.3%), Hang Seng (-3.4%), Kospi (-2.7%) and Australia ASX (-2.0%) are the top underperformers.

At around 12.30 p.m. on 09 November 2016, Indian Equity benchmarks were down 3 percent as news on Republican party leader Donald Trump has taken a lead in US presidential elections came in.

However at 2 p.m on 09 November 2016,Equity benchmarks recovered sharply. The BSE Sensex was down 329.43 points or 1.19 percent at 27261.7 after showing 1300 points recovery. The 50-share NSE Nifty fell 113.30 points or 1.33 percent to 8430.25.This indicates an obvious uncertainty in the market

Oil: The Oil markets are grappling with surplus and global oil prices might not see a huge impact of the US Presidential elections. There  might be a greater demand for renewables as both US presidential candidates are in favour of cleaner energy.

Bond:  With uncertainty around a fall in yield is expected. Chances of the Federal Reserve interest-rate increase in December have dwindled. The yield on Japanese sovereign bonds due in a decade fell one basis point to minus 0.08 percent. South Korea’s 10-year yield fell eight basis points to 1.62 percent. The Indian 10- year bond yield  fell  around 12 basis points to 6.68 percent on 09 November 2016.

Gold: A Trump victory would likely initially spur risk aversion. Gold markets, a safer haven will see demand and help gold prices.

Currency: In order to boost exports Trump has advocated a weaker dollar and this means a positive impact on FII inflows into India as chances of Fed rate  hike in December  2016 is unlikely.

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Rupee Opens at 67.40 Against US Dollar, Down 10 paise

Budget2016_Rupee_up_down_fiscal_deficit_356x200_3409_356

The local unit had hit a high of 67.45 and a low of 67.49.

The Indian rupee opened lower by 10 paise at 67.40/$ against US Dollar on Tuesday as against the previous close of 67.30/$.

British Pound is garnering strong momentum, in light of an ever changing perception on Brexit. The currency markets now seem to be betting big on the ‘Remain vote’.

The Indian currency ended lower by 22 paise at 67.30/$. The local unit had hit a high of 67.45 and a low of 67.49. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 67.40 and for Euro stood at 76.53. The RBI’s reference rate for the Yen stood at 64.44; reference rate for the Great Britain Pound (GBP) stood at 98.1538.

 

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