{LONGTERMINVESTORS} Fwd: Daily Market Report- July 7, 2016

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From: <research@icicibank.com>
Date: Thu, Jul 7, 2016 at 6:18 PM
Subject: Daily Market Report- July 7, 2016
To: stockdesai@gmail.com

Domestic market developments Indian equities ended slightly higher today. Expectations of improvement in monsoon this year and hopes of the passage of the crucial GST bill aided stocks, though downbeat services PMI limited the upside.  Gains were led by stocks of capital goods, banking and realty companies. While Sensex was up 0.1%, Nifty ended flat. Indian Rupee strengthened against the US Dollar at 67.39 levels vs. yesterday's close of 67.46. Reported Dollar sales by foreign banks, likely inflows from FIIs and steady momentum in local bourses aided the domestic currency today. Indian Government bonds ended slightly higher today. Gilts surged early in the day owing to the recent fall in US Treasury yields and upward trajectory of the domestic currency. However, reported profit booking and caution ahead of the bond sale worth INR 150 bn on Friday caused the bonds to trim some gains in the end. The 10Y benchmark yield ended at 7.38% vs. the previous close of 7.39%. RBI withdrew liquidity to the of INR 639.04 bn (net) under LAF (including fixed and variable rate repos and reverse repos), as of July 5th. It injected INR 22.14 bn and 3.15 bn under Special Refinance Facility and Marginal Standing Facility respectively.   Global Market Snapshot *Weighted Average (WAR) over the day Global market developments Asian equities ended largely in the green today. Gains in crude and release of dovish-toned FOMC policy minutes aided stocks today. Recent comments from Chinese Premier Li Keqiang hinting that China's economy may not be able to meet its growth target of 6.7% weighed on Chinese indices today. Hang Seng (1.0%), Kospi (1.1%) and Australia's ASX (0.6%) settled higher. However, Nikkei (-0.7%) posted losses amid rising strength of the Japanese Yen. Meanwhile, Shanghai Composite ended flat. The Pound Sterling is trading slightly stronger today, though post-Brexit losses continue to remain predominant. UK's industrial production in May slipped to (-) 0.5% as against the prior (revised) print of (+) 2.1%, setting the stage for weaker data prints to follow. The Japanese Yen is trading stronger today on the back of safe haven demand. The Dollar index is trading with a depreciation bias ahead of the crucial nonfarm payrolls print, due tomorrow. Meanwhile, the Euro is trading ranged vis-à-vis the US Dollar. US Treasuries are trading slightly lower, though recent gains remain overarching. The 10Y benchmark yield is currently trading at 1.39% as against yesterday's close of 1.37%. Commodity market developments Crude is trading higher today, extending overnight gains. Oil prices gained ~2% since yesterday on account of yet another fall in US crude inventories coupled with softness in the greenback. WTI and Brent are currently trading at USD 48/bbl and USD 49/bbl respectively. Gold is trading higher, hovering around two-year highs as investors flock to safe haven metal amid Brexit concerns. Weakness in the US Dollar further supported prices. The yellow metal is currently trading at USD 1364/oz. Regards, ICICI Bank Contact: Radhika Wadhwa (+91-22) 4008-1414 (ext: 7206) radhika.wadhwa@icicibank.com Sonal Surana (+91-22) 4008-1414 (ext: 7243) sonal.surana@icicibank.com

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CA. Rajesh Desai

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