{LONGTERMINVESTORS} Fwd: Daily Market Report- November 15, 2016

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From: <research@icicibank.com>
Date: Tue, Nov 15, 2016 at 6:50 PM
Subject: Daily Market Report- November 15, 2016
To: stockdesai@gmail.com

Key developments: India's WPI inflation at 3.39% YoY in October vs. 3.57% YoY earlier (market consensus: 3.74% YoY). CPI inflation edges slightly lower to 4.2% YoY in October from 4.39% YoY (revised) earlier (ICICI Bank expectation: 4.1% YoY). Domestic market developments: Indian equities ended in the red today. Recent sell-off in emerging markets and caution around the demonetisation step undertaken by the Government weighed on local indices. Nifty and Sensex ended down 2.3% and 1.9% respectively. Indian Government bonds ended sharply higher today. Expectation of a liquidity boost from the Government's demonetisation step aided gilts. Further, expectation of a comfortable October CPI print (released post market hours) and lower than expected WPI print provided support. The benchmark 10Y yield ended at 6.53% vs. yesterday's close of 6.72%. Indian Rupee weakened against the Dollar. Broad based strength in the greenback and weakness in local bourses weighed on the domestic currency. USDINR pair closed at 67.74 vs. yesterday's close of 67.25. RBI withdrew liquidity to the tune of INR 845.70 (net) under LAF (including fixed and variable rate repos and reverse repos), as of November 14th. It injected INR 12.75 bn and INR 17.62 bn under Marginal Standing Facility and Special Refinance Facility, respectively. Global Market Snapshot *Weighted Average (WAR) over the day Global market developments: Most of the Asian equities ended in the red today on concerns that rising bond yields in developed markets will lead to equity sell-off in emerging markets. Kospi and Australia ASX lost to the tune of ~0.4%, while other indices saw more muted downturns. Hang Seng was the outperformer, gaining by 0.5%. The US Dollar index is trading mildly higher today after seeing some intraday volatility, as markets factored in a substantial fiscal stimulus to the US economy under Donald Trump, in addition to solidification of higher interest rate expectations. The Euro is trading slightly stronger today at 1.0752 levels vis-à-vis US Dollar. The Japanese Yen is trading slightly stronger, on the back of a healthy GDP print for the third quarter. Sterling is mostly flat today, trading at 1.2415 levels vis-à-vis US Dollar. US Treasuries are trading somewhat higher today. The 10-year benchmark yield is at 2.20% vs. yesterday's close of 2.26%. Commodity market developments: Crude oil edged mildly higher today, amid speculation over OPEC's intentions. Focus has now shifted to the OPEC meet scheduled to be held in Vienna later this month. Going ahead, crude prices will take cues from any consensus or the lack of it reached at this meeting. WTI and Brent are currently trading at USD 45.0/bbl and USD 46.0/bbl. Gold rose by 0.3% today. The yellow metal is currently trading at USD 1225/oz. Regards, ICICI Bank Contact: Niharika Tripathi (+91-22) 2653-1414 (extn: 6943) niharika.tripathi@icicibank.com Sumedha Dasgupta (+91-22) 2653-1414 (extn: 7243) sumedha.dasgupta@icicibank.com ​

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CA. Rajesh Desai

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