{LONGTERMINVESTORS} Fwd: Daily Market Report - December 23, 2015

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From: <research@icicibank.com>
Date: Wed, Dec 23, 2015 at 6:12 PM
Subject: Daily Market Report - December 23, 2015
To: stockdesai@gmail.com

Domestic markets wrap-up Reserve Bank of India released the twelfth issue of Financial Stability Report today. The report pointed to subdued performance of the Indian banking sector as a whole. Overall, macroeconomic fundamentals remain robust; however downside risks pertaining to domestic issues of indebtedness levels of corporates, limited policy flexibility and volatile external sector scenario remain pertinent challenges to consider. Bankruptcy and Insolvency Code that was presented to the Lok Sabha on Monday has been referred to a Parliamentary joint committee. The aforesaid panel shall submit its report during the Budget session. Indian indices closed trade in the green today, in line with their Asian peers. Upbeat global cues on account of US GDP data and uptick in oil prices led the rally in local equities. Q2 FY2016 current account deficit number also aided the gains in a holiday-thinned week. Both Sensex and Nifty ended 1.0% higher. Rupee closed stronger vis-à-vis the greenback, at 66.205 levels as against yesterday's close of 66.32. Bullish sentiment on the Indian bourses, coupled with upbeat Q2 current account balance reading aided the domestic currency's appreciation. Gains remained contained following a modest appreciation in the US Dollar. Domestic bonds ended higher on account of value buying. Traders also reportedly held positions for short covering purposes. Lower trading volumes on account of Eid and Christmas holidays ahead capped the gains. The benchmark yield is presently 7.75% vs. yesterday's close of 7.76%. RBI provided liquidity to the tune of INR 1635.08 bn (net) under LAF (including fixed and variable rate repos and reverse repos), as of December 22nd. It injected INR 20.66 bn and INR 1.75 bn under Special Refinance Facility and Marginal Standing Facility respectively.  *Weighted Average (WAR) over the day Global market developments Asian stocks ended largely in the green today. Positive finish on the Wall Street yesterday lifted Asian indices. Gains were further supported by a rebound in oil prices. Hang Seng, Kospi and Australia's ASX edged up 1.0%, 0.3% and 0.5% respectively. Shanghai Composite was the only exception, declining 0.4%. Meanwhile, Japanese markets remained closed on account of Emperor's birthday. Euro is trading weaker vs. the US Dollar at 1.0931 levels, down from yesterday's close of 1.0957. GBPUSD cross is trading at 1.4886 levels, up from Tuesday's close of 1.4828. The Pound strengthened against the greenback despite a downward revision of UK Q3 GDP print to 0.4% QoQ vis-à-vis prior reading of 0.5% QoQ. The current account deficit for the same period, however, remained unchanged at GBP 17.5 bn. US Treasuries are trading lower today following retracement in oil prices that cheered market sentiment. The benchmark 10Y yield is at 2.25%, relative to the 2.23% levels seen during intra-day trade. Commodity market developments Oil is trading with gains, halting the steep decline seen the past few weeks. OPEC came out with its World Oil Outlook report today. The report forecasts that the long term value of the cartel's reference basket will rise above USD 70/bbl by 2020. Further, medium term projections for world oil demand have also been corrected upwards relative to the2014 forecast. Both WTI and Brent are currently trading at USD 37/bbl. Gold is trading little changed today. Upswing in oil prices augmented market sentiment but trading volumes remained muted on account of Christmas holidays. Regards, ICICI Bank Contact: Sagrika Gogia (+91-22) 4008-1414 (ext:2180) sagrika.gogia@icicibank.com

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CA. Rajesh Desai

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