{LONGTERMINVESTORS} Fwd: Daily Market Report - August 5, 2016

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From: <research@icicibank.com>
Date: Fri, Aug 5, 2016 at 5:14 PM
Subject: Daily Market Report - August 5, 2016
To: stockdesai@gmail.com

Domestic market developments Indian equities ended in the green today, extending early morning gains. Gains were led by stocks of realty, power, oil & gas, metals, capital goods and banking companies. Further, IMD report indicating that rainfall in the week ended August 3rd was 6% above average, anchored market sentiment. Nifty and Sensex closed higher by 1.5% and 1.3% respectively. Indian Rupee ended stronger vis-à-vis the US Dollar at 66.76 levels vs. yesterday's close of 66.91. Upbeat momentum in local bourses and improved global risk appetite aided the domestic currency. Dollar sales by FIIs and exporters supported further. However, the upside was capped amid Dollar bids by oil importers and foreign banks. Indian Government bonds ended little changed today. Demand for gilts by PSU banks and upward momentum in the domestic currency aided domestic bonds today. However, gilts trimmed some of its early morning gains as the auction of Government bonds worth INR 150 bn resulted in less than expected cut-offs. The 10Y benchmark yield ended at 7.17%, same as yesterday's close. RBI withdrew liquidity to the tune of INR 567.81 bn (net) under LAF (including fixed and variable rate repos and reverse repos), as of August 4th. It injected INR 5.5 bn and INT 17.12 bn under Marginal Standing Facility and Special Refinance Facility respectively. Global Market Snapshot *Weighted Average (WAR) over the day Global market developments Asian equities ended largely in the green today. Markets remained largely upbeat in light of elevated global sentiment after the announcement of aggressive easing measures by the Bank of England yesterday. Going ahead, US NFP data print, due later today, will be closely tracked by the markets. Hang Seng (1.4%), Australia's ASX (0.4%) and Kospi (0.9%) settled higher. However, Shanghai Composite (-0.2%) posted losses. Meanwhile, Nikkei ended flat. The Dollar index is trading slightly weaker amid caution ahead of crucial US jobs data release, due later today. Meanwhile, the Euro is trading slightly stronger vis-à-vis the greenback amid weakness in the latter. The Pound is trading stronger today, marginally correcting losses that followed the aggressive policy easing by the Bank of England yesterday. The Japanese Yen is also trading slightly stronger, tracking movements in the US Dollar. Abated risk-aversion in Asian trade, however, curbed the safe-haven demand for the Yen. US Treasuries are trading little changed today, though holding on to the steep gains from yesterday. Until the release of the key NFP data, the sovereign bonds are expected to trade in a narrow range. The 10Y benchmark index is presently trading at 1.50%, same as the previous close. Commodity market developments Crude is trading lower today, extending its early morning losses. Crude is expected to trade under pressure as oversupply concerns grip global markets. Going ahead, Dollar trajectory is likely to guide movements in oil prices. WTI and Brent are presently at USD 42/bbl and USD 44/bbl respectively. Gold is holding on to its overnight gains as markets await the release of crucial US jobs data today. However, upbeat global sentiment following the BoE's policy outcome are limiting the safe haven appeal for the bullion. The yellow metal is currently trading at USD 1362/oz. Regards, ICICI Bank Contact: Sonal Surana (+91-22) 2653-1414 (extn: 7243) sonal.surana@icicibank.com ​

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CA. Rajesh Desai

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