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Adviser MONEY MAKING MC
08 July 2016
I had mentioned in last week’s closing report
that Sensex, Nifty were vulnerable to a short-term decline. The major indices
in the Indian stock markets were trading listlessly through the week. On a
weekly basis, the markets ended flat with the Sensex and Nifty marginally lower
and the Bank Nifty marginally higher than last week’s close. The trends of the
major indices in the course of the week’s trading are given in the table below: The Total Investment &
Insurance Solutions
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| Indian Indices(The Total Investment & Insurance Solutions) |
On
Monday, positive global cues, along with higher crude oil prices and firm rupee
buoyed the Indian equity markets for the sixth consecutive session on Monday.
The key indices traded with appreciable gains to reach their new 2016 intra-day
high levels, as healthy buying was witnessed in capital goods, oil and gas, and
metal stocks. The BSE market breadth was skewed in favour of the bulls -- with
1,724 advances and 1,016 declines.
The Total Investment & Insurance Solutions
Even
though Indian commercial banks' shares have moved higher, ignoring Brexit
(Britain exiting European Union), the currency volatility risks have to be
understood, said US investment banking firm Jefferies in a report. Banks need
to make provisions for their exposures to corporate with unhedged foreign
currency exposure (UFC) and additional capital buffer for high risk UFCEs, the
report said. Jefferies estimate the risk exposure at 1.7% of gross credit
exposure for banking system. Banks have built Rs13 billion in provisions and
Rs29 billion in additional capital as of FY16. According to the report, Bank of
Baroda (BOB) is the only to report Liquidity Coverage Ratio (LCR) in British
pound implying five per cent plus of liability in that currency. “This may
result in higher hedge costs going forward -- marginal NIM (net interest
margin) negative. This of course depends on the currency composition on the
asset side -- unfortunately we don't have sufficient public data to delve
deeper," the report said. Bank Nifty closed at 18,097.65, up 0.62%. The Total Investment &
Insurance Solutions
On
Tuesday, bearish global cues, subdued the Indian equity markets. Consequently,
the key indices traded in the red during the late-afternoon session. Heavy
selling pressure was witnessed in automobile, banking and information
technology (IT) stocks. The BSE market breadth was tilted in favour of the
bears -- with 1,277 advances and 1,476 declines. The Total Investment &
Insurance Solutions
China is highly concerned with Indian trade
remedy measures against Chinese steel products, the Ministry of Commerce said.
The Indian government has launched an anti-dumping investigation into
colour-coated steel sheets imported from China. It is the fifth such probe
against China from India this year, the highest record among WTO members,
according to a statement on the ministry's website. The global steel industry
was experiencing difficulties due to sluggish economic growth and weak demand,
but abuse of trade remedy measures would not help resolve industrial
overcapacity but hamper normal trade, the statement said. SAIL shares closed at
Rs47.50, up 1.50% on the BSE on Tuesday.
Wednesday was a market holiday on account of
the Muslim festival Eid-ul-Fitr. On Thursday, the major indices of the Indian
markets ended flat compared to Tuesday’s close and there were just marginal
gains. Technology stocks, including those in media and entertainment space,
came under selling pressure with their sectoral indices losing over 1.5%, even
as the indices for fast-moving consumer goods, healthcare and banking sectors
closed with gains.
Negative
global cues and profit booking dragged the key Indian equity markets lower on
Friday. The equity markets traded flat and ended marginally in the red, as
heavy selling pressure was witnessed in capital goods, banking and oil and gas
stocks. Midcap and smallcap indices traded lower. Pharma, auto and IT indices
traded with gains. PSU bank, FMCG (fast moving consumer goods), realty and
metal indices traded in the red.
The Total Investment & Insurance Solutions
