MORNING NEWS CALL REUTERS EDITION Wednesday, May 24, 2017

FACTORS TO WATCH

10:00 am: India Business Unit Head C.N. Raghupati, IBM Chief Data Strategist and HCL Founder Ajai Chowdhry at IT Conclave in Kolkata. 12:00 pm: Samsung launch event in Bengaluru. 11:45 am: Telecom minister at an event in . 12:30 pm: Aviation Minister P to brief media on second round of bidding under RCS-UDAN in New Delhi.

LIVECHAT - OPEC PREVIEW As the extension of output cuts by oil producers becomes more likely all the way to 2018, how would this decision affect oil demand and supply in Asia? Sushant Gupta, Research Director in Asia Refining, from consulting firm Wood Mackenzie will discuss the implications of the upcoming OPEC meeting and how they would be relevant to Asian investors at 11:30 am IST. To join the conversation, click here

INDIA TOP NEWS

India offers tax concessions to Apple to expand production - official India has offered to allow Apple Inc to import mobile handset components intended for use in local manufacturing tax free, a top government official said on Tuesday.

ANALYSIS-India's electric vehicles push likely to benefit Chinese car makers India's ambitious plan to push electric vehicles at the expense of other technologies could benefit Chinese car makers seeking to enter the market, but is worrying established automakers in the country who have so far focused on making hybrid models.

Losses at home outweigh strong JLR sales for India's India's Tata Motors reported a 17 percent fall in fourth-quarter net profit on Tuesday as losses in its domestic business outweighed strong sales at luxury British arm Jaguar Land Rover (JLR).

Jindal Steel to swing to profit by 2018/19 Jindal Steel and Power plans to increase its total steel capacity by as much as 50 percent this fiscal year and turn profitable by 2018/19, its chief executive said, after the company showed its losses narrowing in the fourth quarter.

India gold imports to plunge in festive months after pre-GST purchases India's gold imports could plunge in 2017 during the traditional period of peak demand in the second half of the year, after jewellers have aggressively restocked inventory ahead of a national sales tax that takes effect on July 1.

ANALYSIS-"War on sugar" takes toll; Asia, Brazil struggle to make up shortfall The "war on sugar" being waged by governments and consumers to combat public health emergencies like diabetes is slowing growth in global demand, which along with other factors could signal a fundamental shift in consumption ahead.

GLOBAL TOP STORIES

Moody's downgrades China, expecting financial strength to erode as debt rises Moody's Investors Services downgraded China's long-term local and foreign currency issuer ratings on Wednesday citing expectations that the financial strength of the world's second biggest economy would erode in the coming years.

UK PM May says to deploy armed forces after attack as threat level raised Soldiers will be deployed to key sites in Britain to boost security as the country raised its terror threat to the highest level of "critical" following a suicide attack in Manchester that killed 22 people, including children.

Trump seeks to slash $3.6 trillion of spending in austere budget U.S. President Donald Trump asked lawmakers on Tuesday to cut $3.6 trillion in government spending over the next decade, taking aim at healthcare and food assistance programs for the poor in an austere budget that also boosts the MORNING NEWS CALL - INDIA EDITION May 24, 2017 military.

STATE OF THE MARKETS

The SGX Nifty Futures were trading at 9,405.00, up 0.2 pct from its previous close.

The will likely open little changed to slightly lower against the dollar, tracking weakness in its Asian peers, as regional sentiment faltered after Moody’s Investors Service cut China’s sovereign credit rating. -NewsRise

Indian government bonds will likely trade steady, as investors await the release of U.S. Federal Reserve’s May meeting minutes later today for clues about its next interest rate hike. The yield on the benchmark 6.97 pct bond maturing in 2026 is likely to trade in a 6.75 pct-6.80 pct band today. -NewsRise

Wall Street ended higher on Tuesday after the release of President Donald Trump's budget plan but gains were tempered by declines in consumer discretionary stocks amid weakness in auto-parts companies.

Asian shares edged lower in early trade, while the Australian dollar and the offshore Chinese yuan slipped after Moody's cut its sovereign credit rating on China.

The dollar held firm, having rebounded from 6-1/2-month lows against its major peers thanks to a rise in U.S. Treasury yields, with investor focus now turning towards the Federal Reserve's monetary policy stance.

U.S. Treasury yields rose on Tuesday as some investors pared their bond positions to make room for this week's federal and corporate supply while others reduced their safe-haven bond holdings in favor of stocks.

Oil prices rose, supported by increasing confidence that an OPEC-led production cut aimed at tightening the market would be extended through the rest of 2017 and the first quarter of next year.

Gold held steady, after falling 0.7 percent in the previous session, as investors waited for cues on the U.S. Federal Reserve's rate hike stance from minutes of the central 's latest meeting, due later in the day.

CLOSE FII INVESTMENTS EQUITIES DEBT

PNDF spot 64.77/64.80 May 23 -$61.82 mln $616.58 mln

10-yr bond yield 7.10 Month-to-date $1.45 bln $3.15 bln

Year-to-date $7.88 bln $12.54 bln

2 MORNING NEWS CALL - INDIA EDITION May 24, 2017

PICTURE OF THE DAY

A fisherman stitches nets as his child sleeps beside him along the sea coast on the outskirts of Kochi, May 23. REUTERS/Sivaram V

(Compiled by Pathikrit Bandyopadhyay in Bengaluru) © 2017 Thomson Reuters. All rights reserved. This content is the intellectual property of Thomson Reuters and its affiliates. Any copying, distribution or For questions or comments about this report, contact: redistribution of this content is expressly prohibited without the prior written [email protected] consent of Thomson Reuters. Thomson Reuters shall not be liable for any errors or delays in content, or for any actions taken in reliance thereon. Thom- son Reuters and its logo are registered trademarks or trademarks of the Thom- For more information about our products: son Reuters group of companies around the world. thomsonreuters.com/products_services Privacy Statement: To find out more about how we may collect, use and share Or send us a sales enquiry at: your personal information please read our privacy statement: thomsonreuters.com/products_services/financial/contactus/ http://thomsonreuters.com/site/financial-risk-privacy-statement/ or call us on North America: +1 800 758 5555 You can manage your Thomson Reuters Financial and Risk communication You may instruct us to remove you from Morning News Call by clicking on the preferences via the link - https://pc2.mypreferences.com/ThomsonReutersFR/ link - https://forms.thomsonreuters.com/MorningNewsCall/Unsubscribe/

3