{LONGTERMINVESTORS} Fwd: Daily Market Report - August 30, 2016

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From: <research@icicibank.com>
Date: Tue, Aug 30, 2016 at 5:49 PM
Subject: Daily Market Report - August 30, 2016
To: stockdesai@gmail.com

Domestic market developments Indian equities ended steeply higher today. Sensex and Nifty surged above its psychological 28,000 and 8700 mark respectively, led by gains in stocks of power, capital goods, banks and auto companies. Markets now await India's Q2 2016 GDP and GVA prints along with fiscal deficit data for July, due tomorrow. Sensex and Nifty ended higher by 1.6% each. Indian Rupee ended stronger vis-à-vis the US Dollar, closing at 67.02 levels vs. the previous close of 67.17. Reported Dollar sales by foreign banks and steeply higher finish in local bourses aided the domestic currency. Going ahead, US jobs market report, due on Friday, will be closely eyed. Indian Government bonds ended marginally higher today. The new 10-year bond announcement, strength in the domestic currency and market wide expectation of an open market bond purchase supported gilts today. However, reported profit booking by PSUs and intraday gain in oil prices capped the upside. The 10Y benchmark yield ended at 7.11% vs. the previous close of 7.12%. RBI withdrew liquidity to the tune of INR 345.28 bn (net) under LAF (including fixed and variable rate repos and reverse repos), as of August 29th. It injected INR 3.0 bn and INR 17.95 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 mostly higher today, with the exception of Japanese indices. Markets in Japan shrugged off better-than expected data released today. Japan's seasonally adjusted measure of unemployment rate in July came in at 3%, the lowest since 1995. Furthermore, retail sales in July rose steeply to 1.4% from 0.2% previously. Hang Seng (+0.9%), Shanghai Composite (+0.2%), Kospi (+0.4%) and Australia's ASX (+0.2%) ended higher. Meanwhile, Nikkei (-0.1%) ended slightly lower. The Dollar Index is trading stronger today amid hawkish comments by Fed officials. Markets will track further clues regarding the possible timing of the next rate hike from Friday's nonfarm payrolls print. The Euro is trading weaker vis-à-vis the US Dollar on account of strength in the latter. On the data front, Eurozone's consumer confidence data for August (final reading) came in unchanged at (-) 8.5%. Meanwhile, the Japanese Yen is trading with a depreciation bias against the greenback today. Improved risk sentiment in markets globally is weighing on the safe haven currency. The Pound Sterling is trading little changed today. US Treasuries are trading little changed today. Friday's job market data from the US will be closely eyed by markets. The 10Y benchmark yield is currently trading at 1.57% vs. the previous close of 1.56%. Commodity market developments Crude is trading higher today on account of production disruptions in the US Gulf due to an expected tropical storm. Prices are also being supported by speculation that major producers will arrive at an output freeze decision next month in Algeria. WTI and Brent are currently trading at USD 47/bbl and USD 49/bbl respectively. Gold is trading lower today amid hawkish comments by Fed officials. Markets now turn to the crucial nonfarm payrolls print, due on Friday, for further cues on the timing of the next rate hike. The yellow metal is currently trading at USD 1320/oz. Regards, ICICI Bank Contact: Sonal Surana (+91-22) 2653-1414 (extn: 7243) sonal.surana@icicibank.com Radhika Wadhwa (+91-22) 2653-1414 (extn: 7206) radhika.wadhwa@icicibank.com ​

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CA. Rajesh Desai

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