September 9, 2021 `
Indian equity benchmark indices’ returns Indian equity market summary % change % change ■ The upward trend in Indian equities persisted for the third consecutive week. Broad indices Sep 9 for week for YTD S&P BSE Sensex and Nifty 50 advanced 0.3% each. S&P BSE Midcap 24,705 1.33 37.70 ■ Buying interest in consumer durables, power and fast-moving consumer S&P BSE SMALLCAP 27,645 1.24 52.75 goods (FMCG) stocks buoyed the market. S&P Consumer Durables, S&P Nifty 500 14,836 0.52 28.81 S&P BSE 100 17,650 0.31 25.18 BSE Power and S&P BSE FMCG gained 3.5%, 1.5% and 1%, respectively. S&P BSE Sensex 58,305 0.30 22.10 ■ Receding concerns over the early withdrawal of the US Federal Reserve’s Nifty 50 17,369 0.26 24.23 monetary stimulus also boosted market sentiment. % change % change Sectoral indices Sep 9 for week for YTD ■ However, some gains were capped on worries over global economic S&P BSE CD 40,243 3.50 32.41 recovery amid a resurgence in Covid-19 cases. S&P BSE Power 3,044 1.51 47.59 ■ A pullback in healthcare, oil & gas and information technology (IT) stocks S&P BSE FMCG 14,942 0.92 18.50 S&P BSE CG 25,767 0.81 37.46 weighed on the market to a certain extent. S&P BSE Healthcare, S&P BSE S&P BSE Metal 20,704 0.42 78.49 Oil & Gas and S&P BSE IT fell 0.9%, 0.7% and 0.3%, respectively, this S&P BSE Auto 22,693 0.07 9.04 week. S&P BSE Realty 3,322 -0.07 34.06 Index S&P BSE Bankex 41,814 -0.16 16.51 Other major domestic news S&P BSE IT 34,320 -0.26 41.53 ■ India’s IHS Markit services PMI rose to 56.7 in August from 45.4 in the S&P BSE Oil & Gas 17,427 -0.71 23.68 previous month; the composite PMI increased to 55.4 in August from 49.2 S&P BSE Healthcare 26,515 -0.90 22.29 in July. Source: Bombay Stock Exchange, National Stock Exchange (NSE) ■ S&P Global expects India’s economy to grow 9.5% in the current fiscal year, FII and mutual fund investment versus Nifty followed by 7% expansion in the next year. (FII/MF ■ The Cabinet approved a Rs 10683 crore production-linked incentive scheme (Nifty) Inv Rs Cr ) 17500 4,000 for the textile sector. 17200 3,000 2,000 ■ The Cabinet approved the signing of a pact between Russia and India for 16900 1,000 cooperation in the field of geosciences. 16600 0 -1,000 16300 -2,000 ■ The Cabinet approved an increase in the minimum support price for all the 16000 -3,000 mandated Rabi crops for the Rabi Marketing Season 2022-23.
■ The Indian government and the Asian Development Bank (ADB) signed an
6-Aug 9-Aug 1-Sep 2-Sep 3-Sep 6-Sep 7-Sep 8-Sep
18-Aug 30-Aug 10-Aug 11-Aug 12-Aug 13-Aug 16-Aug 17-Aug 20-Aug 23-Aug 24-Aug 25-Aug 26-Aug 27-Aug 31-Aug agreement for a $300 million loan as additional financing to scale up FII Net Investment MF Net Investment Nifty connectivity to boost the rural economy in Maharashtra.
FII – Foreign institutional investor ■ ADB approved a $150 million loan for a sustainable housing project for Source: Securities and Exchange Board of India (SEBI), NSE urban poor in Tamil Nadu.
FII and mutual fund weekly investment ■ The Ministry of Finance said electronic records submitted through the Sep 3 – Sep 8 registered account of taxpayers in the income tax portal shall be deemed to Rs crore FII investment MF investment be authenticated by taxpayers by electronic verification code. (equity) (equity)* ■ India and the United States inked a pact for cooperation in the development Buy 28,542 NA of an air-launched unmanned aerial vehicle. Sell 28,944 NA ■ The Reserve Bank of India (RBI) enhanced the scope of tokenisation to Net -402 NA YTD 54,885 17,177 ensure security of card data, permitting card issuers to act as token service providers. Source: SEBI, National Securities Depository Ltd (NSDL) *Data as of Sep 2 ■ RBI refused to extend its deadline for card tokenisation beyond January 1, 2022, making it impossible for one-click purchases on merchant sites. ■ According to RBI data, sales of 1,647 listed private manufacturing Domestic macro indicators companies recorded growth of 75% in the first quarter of current fiscal mainly Indicators Current Previous due to a very low base in the pandemic-hit year-ago period. 5.59% 6.26% Monthly CPI inflation (Jul-21) (Jun-21) ■ The Securities and Exchange Board of India (SEBI) introduced a T+1 11.16% 12.07% settlement cycle for completion of share transactions on an optional basis to Monthly WPI inflation (Jul-21) (Jun-21) enhance market liquidity. 13.6% 28.6% IIP (Jun-21) (May-21) ■ SEBI asked asset management companies (AMCs) to invest in schemes 20.10% 1.60% GDP based on risk and quantify the minimum amount to be invested in their own (Apr-Jun 21) (Jan-Mar 21) CPI – Consumer Price Index, WPI – Wholesale Price Index, IIP – mutual fund schemes. Index of Industrial Production Source: CRISIL Centre for Economic Research ■ SEBI asked stock exchanges and brokers to increase investor awareness, especially among the new entrants, about the risks of option trades.
Indian debt market indicators Indian debt market summary Previous ■ The interbank call money rate settled at 3.10% on September 9 compared Indicators Sep 9 Trend week with 3.25% on September 3. Call rate 3.10% 3.25% ■ The RBI conducted two variable rate reverse repo auctions over the week 3-month CP 3.60% 3.54% noting the liquidity conditions. The first auction was of a 7-day duration and 1-year CP 4.40% 4.40% conducted on September 7 for a notified Rs 50,000 crore and the second 3-month CD 3.30% 3.30% auction on September 9 was for a notified Rs 3.5 lakh crore. 3.84% 3.78% 1-year CD ■ The central bank received offers amounting to ~Rs 2.64 lakh crore in the 5.15% 5.15% 3-year AAA first auction and ~Rs 5.21 lakh crore in the second auction. 5-year AAA 6.10% 6.10% ■ Government bond prices ended lower and the yield of the 10-year 1-year G-Sec* 4.85% 4.80% benchmark 6.10% 2031 paper settled at 6.18% on September 9 compared 3-year G-Sec* 4.85% 4.80% with 6.16% on September 3. 5-year G-Sec* 5.61% 5.58% ■ A midweek rise in US benchmark treasury yields put local bond prices under 10-year G-Sec* 6.18% 6.16% $ 633.56 $ 6 16.90 pressure. Forex reserves billion billion ■ US bond yields rose amid investor concerns over US inflation and (Aug 27) (Aug 20) nervousness ahead of the European Central Bank’s monetary policy *Weighted average yield meeting. Source: CRISIL Fixed Income database, RBI ■ Intermittent profit sales pulled down local bond prices further. Corporate bond spreads over G-secs ■ Hopes that domestic fiscal and monetary policy will stay benign going Spreads AAA AA+ AA AA- A+ forward supported market sentiment. 3 yr 0.24% 1.63% 2.82% 3.53% 4.36% Sep 9, ■ Firm demand for debt in the previous week’s gilt sale and the government’s 5 yr 0.42% 2.38% 3.57% 4.27% 5.17% 2021 decision to sell a new 14-year note in the current week’s auction aided bond 10 yr 0.63% 2.59% 3.78% 4.48% 5.38% prices. 3 yr 0.30% 1.69% 2.88% 3.58% 4.42% Previous ■ In the weekly gilt auction, the RBI sold the 5.63% 2026 paper, the 6.67% 5 yr 0.44% 2.40% 3.59% 4.29% 5.19% week 2050 paper, a floating rate bond maturing in 2034, and a new paper maturing 10 yr 0.64% 2.61% 3.79% 4.50% 5.39% in 2035. Source: CRISIL fixed income database ■ Prices received a boost in the final session as the central bank sold a 10-year benchmark G-sec movement greater-than-scheduled quantum of bonds in the auction at lower-than- expected cut-off yields. 6.60% ■ The rupee ended lower against the US dollar weighed by greenback 6.40% demand from importers. 6.20% ■ Gains registered by the US dollar index amid weakness in investor risk
6.00% appetite due to uncertainty around a bond taper timeline in the US and the rapidly spreading delta variant of the coronavirus globally, added to the 5.80% pressure on the rupee. 5.60% ■ Dollar sales by some foreign banks prevented the rupee from depreciating
further.
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9-Sep-20 9-Nov-20 9-Dec-20 9-Aug-21 9-Sep-21 9-May-21 Currencies versus rupee Source: CRISIL Fixed Income database Currency Sep 9 Week ago 3 months ago 1 year ago India yield curve shift (on-week)* USD 73.50 73.02 72.97 73.54 101.56 101.04 103.45 95.28 8.00 6 GBP 5 Euro 86.97 86.67 88.96 86.62 4 7.00 3 100 Yen 66.93 66.43 66.68 69.36 2 2 bpsin Change 2 6.00 Source: CRISIL 0 5.00 Yield Yield in % -2 -2 4.00 -3 -3 -4
3.00 -6 3 Mths 6 Mths 1 Yr 5 Yrs 10 Yrs 20 Yrs 30 Yrs
Change in bps 9-Sep 3-Sep
*Weighted average yield Source: CRISIL Fixed Income database
Global equity benchmark indices’ returns Global market summary % % ■ Global equities ended mixed this week amid region-specific cues. US change change treasury prices ended almost flat as earlier losses were set off by safe-haven Country/Region Indices Sep 9 for for buying amid a resurgence in Covid-19 cases. Crude oil prices ended flat as week YTD earlier losses due to worries about a slowdown in fuel demand were offset DJIA* 35,031 -0.96 14.46 by gains after the producers in the US Gulf of Mexico struggled to restart Nasdaq 15,287 -0.50 18.61 operations post Hurricane Ida. US Composite* ■ US stocks ended lower on concerns over a slowdown in economic recovery Russell 3000 2,337 -0.43 19.68 Growth* due to the spread of Covid-19 delta variant and uncertainty over a monetary UK FTSE 100* 7,096 -0.60 9.83 stimulus pullback by the US Federal Reserve (Fed). France CAC 40* 6,669 -0.32 20.13 ■ Further, weak jobs growth data also pressurised the markets. Germany XetraDax* 15,610 -1.08 13.79 o According to the Fed’s Beige Book, the US economy "downshifted Japan Nikkei 225 30,008 3.02 9.34 slightly" in August as the pandemic’s renewed surge hit dining, travel Singapore Straits Times 3,072 -0.39 8.01 and tourism. Hong Kong Hang Seng 25,716 -0.72 -5.56 o US non-farm payroll employment rose by 235,000 jobs in August after Shanghai China 3,693 3.11 6.34 soaring by an upwardly revised 1.053 million jobs in July; the Comp unemployment rate fell to 5.2% in August from 5.4% in July. Source: Websites of respective stock exchanges; *As of Sep 8 o US ISM non-manufacturing index fell to 61.7 in August after reaching
Macro indicators an all-time high of 64.1 in July. Indicators Current Previous ■ However, intermittent gains in technology stocks capped some losses. 19.6 22.2 ■ Britain’s FTSE fell 0.6% tracking weak US markets, and a sell-off in energy, Eurozone Sentix Index (Sep 2021) (Aug 2021) healthcare, pharmaceutical, banking and brokerages stocks. 14.3% -1.2% Eurozone GDP (Q2 2021) (Q1 2021) o UK CIPS services PMI came in at 55 in August compared with 59.6 in 55.2 58.7 July; the composite PMI was 54.8 in August compared with 59.2 in July. UK Construction PMI (Aug 2021) (Jul 2021) ■ Other European equities ended lower amid uncertainty over economic 1.9% -4.2% growth and a resurgence in Covid-19 cases. France’s CAC 40 fell 0.4%, Japan GDP (Q2 2021) (Q1 2021) 0.8% 1.0% while Germany’s DAX slipped 1%. China Consumer Prices (Aug 2021) (Jul 2021) o Eurozone GDP increased by 14.3% on-year in the second quarter Source: CRISIL internal research compared with a revised 1.2% contraction in the first quarter. Major global bond yields ■ Asian equities ended mixed. Japan’s Nikkei surged 3% as investors hoped Indicators Sep 9 Sep 3 that the country’s new Prime Minister could ensure a recovery by tackling US 10-year* 1.33 1.32 the pandemic crisis and its economic impact through proactive measures. UK 10-year* 0.74 0.72 o Japan’s GDP grew an annualized 1.9% in the second quarter, higher German 10-year* -0.33 -0.37 than the initial estimate for a 1.3% rise, and compared with a 4.2% Japan10-year 0.04 0.03 Source: Bloomberg.com; *As of Sep 8 contraction in the first quarter. ■ Hong Kong’s Hang Seng fell 0.72% owing to losses in financial stocks and Commodity prices after Beijing tightened regulations on the gaming industry. % % change Commodity Sep 9 change ■ China’s Shanghai Composite rallied 3% following strong economic data and for YTD for week as investors cheered reports that the country securities regulator would NYMEX crude oil ($ per 69.30 0.01 42.83 further open capital markets to support foreign investors. barrel)* o China posted a trade surplus of $58.34 billion in August compared with Brent crude oil ($ per 72.60 -0.01 40.15 a $56.6 billion surplus in July. barrel)* Gold ($ per ounce)* 1795.66 -0.77 -4.87 o China’s consumer price index rose 0.8% on-year in August compared Silver (Rs per kg) 64067.00 0.93 -4.78 with a 1% rise in July, while the producer price index rose 9.5% on- Source: Respective commodity exchanges, goldprice.org, year in August compared with a 9% rise in July. ibjarates.com; *As of Sep 8
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