FIIs/FPIs have sold Indian equity shares worth Rs. 42 billion in January 2019and bought shares worth Rs. 53 billion in February 2019 (till 08th February).
The Nifty Index futures witnessed rise in open interest by 17% for the February series and rise in open interest by 7% for the March series. Implied volatility (IV) fell for put option and call option in the last week. Fall in IV for put option and call option shows steady support for Nifty at present levels.
Japan’s current account surplus narrowed to JPY 453 billion in December 2018 from JPY 797 billion a year earlier but came slightly above market expectations of JPY 430 billion.
The U.S. trade deficit narrowed to USD 49.3 billion in November 2018 from an upwardly revised USD 55.7 billion in the previous month and compared with market expectations of a USD 54 billion gap. It is the lowest deficit in 5 months.
Bank of England policymakers voted unanimously to hold the Bank Rate at 0.75% during its February policy-meeting and indicated that there would be fewer increases in borrowing costs in 2019 as the UK economy faces the weakest economic growth in 10 years amid persistent concerns about Brexit and a global slowdown. The central bank lowered its 2019 economic growth forecast to 1.2% from its previous estimate of 1.7% while inflation is expected to decline to slightly below 2% target in the near term, largely due to the sharp fall in petrol prices.
The Eurozone economy grew 1.2% during Q4Fy18, easing from a 1.6% expansion in the previous three-month period and matching market expectations. Meanwhile, the European Commission cut its Eurozone growth forecast for this year to 1.3% on 7th February 2019 from 1.9% in its earlier forecast, citing large uncertainty from Brexit negotiations, slowing growth in China and weakening global trade.
The number of Americans filling for unemployment benefits decreased by 19,000 to 234,000 in the week ending 2nd February 2019 from the previous week’s unrevised level of 253,000.
US crude oil stocks rose by 1.263 million barrels in the week ending 01st February 2019, following a 0.919 million increase in the previous week and compared with market expectations of a 2.179 million gain.
Wall Street pared most of the sharp losses earlier in the session to close mixed on Friday, amid renewed worries about the US and China trade dispute. A new report suggested there is still no draft on a trade deal and also showed next week President Donald Trump could sign an order to ban Chinese telecommunication equipment from US wireless network During the week, Dow Jones rose by 0.17%, Nasdaq surged by 0.47% and S&P 500 gained marginally by 0.10%.
European stocks closed in the red on Friday, tracking losses on Wall Street, amid renewed worries about the US and China trade dispute. During the week, DAX declined by 2.50% and FTSE rose by 0.74%.
Oil prices dropped amid reports that Libya could increase oil production after military commander Haftar seized the country’s largest oil field. Also, latest US data showed crude inventories rose by 1.26 barrels in the week ended 1st February 2019 according to the Energy Information Administration (EIA). On weekly basis, Brent Crude fell by 1%.
Sensex and Nifty gained by 0.46% and 0.20% respectively during last week.
The Reserve Bank of India lowered unexpectedly its benchmark interest rate by 25bps to 6.25% during its February policy meeting and shifted its stance to “neutral” in an attempt to boost a slowing economy as inflation rate remains well below its mid-point target of 4%. The central bank also released its bi-monthly review of the economy, where it forecast India’s economy will expand 7.4% in 2019-20, up from 7.2% in this fiscal year.
India’s fiscal deficit widened to Rs. 7 trillion in April-December 2018 from Rs. 6.21 trillion in the same period of the previous fiscal year. Total expenditures went up 7.8% to Rs. 18.32 trillion and revenues rose at a slower 5% to Rs. 11.31 trillion. The budget gap is equivalent to 112% of the government’s target for the whole financial year, compared with 114% a year ago.
Sectoral Indices Trends:
The sectoral indices mostly closed in positive territory during last week. The S&P BSE Oil & Gas, IT and Bankex had gained by 0.15%, 1.24% and 0.44% respectively. S&P BSE PSU and Auto indices declined by 2.5% and 0.22% respectively.
Tata Motors Witnesses highest rise in turnover in Stock Derivatives
Tata Motors has witnessed rise in open interest in the stock future segment in the last week. Share price of Tata Motors declined by 16% in the last week. Tata Motors share price fell as much as 30% during intra-day after the company posted a loss of Rs. 270 billion for Q3Fy19 due to an impairment charge for its luxury car unit JLR. The write-off has been attributed to slowing sales in China, technology disruptions linked to a shift towards eco-friendly hybrid and electric vehicles, and the rising cost of debt. On the revenue front, consolidated revenues increased by 5% (Y-o-Y). Sales in China fell 47% (Y-o-Y) offsetting 21% (Y-o-Y) and 18% (Y-o-Y) increase in North America and the UK respectively. Moreover, Brexit can have negative implications, due to tariffs and change in manufacturing/sourcing strategies.
Foreign Institutional Investors (FIIs) Derivative Statistics have shown rise in the open interest across Stock Options, Stock futures, Index futures and Index options on a week on week basis.
Indian rupee appreciated by 0.44% against USD, USD/INR pair closed at Rs. 71.16 in the last week.