FIIs/FPIs have sold Indian equity shares worth Rs. 124 billion in July 2019 and shares worth Rs. 175 billion in August 2019.
The Nifty Index futures witnessed rise in open interest by 346% for the September series and rose by 134% for the October series. Implied volatility (IV) fell for put option and call option in the last week. Fall in IV for call option and put option shows steady support for Nifty at present levels.
Global Economy
Industrial production in Japan climbed 1.3% (M-o-M) in July 2019 after contracting 3.3% in the previous month, preliminary data showed. On an annual basis, industrial output grew 0.7% in July, the first increase in six months.
The annual inflation rate in the Euro Area came in at 1% in August 2019, unchanged from the previous month and in line with market consensus, a preliminary estimate showed. It remained the lowest inflation rate since November 2016
Industrial production in South Korea climbed 0.6% (Y-o-Y) in July 2019, following a downwardly revised 2.6% drop in the previous month and compared with market consensus of a 1.6% decrease. Manufacturing output grew 0.8%, after shrinking 2.7% in June 2019.
The Official NBS Manufacturing PMI in China dropped to 49.5 levels in August 2019 from 49.7 levels in the previous month and below market expectations of 49.7 levels. The latest reading pointed to the fourth straight month of contraction in factory activity, amid growing trade frictions with the US and sluggish domestic demand.
The number of Americans filling for unemployment benefits increased by 4,000 to 215,000 in the week ended 24th August 2019 from the previous week’s revised level of 211,000 and in line with market expectations.
Stocks of crude oil in the United States slumped by 10.027 million barrels in the week ended August 23rd of 2019, following a 2.7 million decrease in the previous week and compared with market expectations of a 2.112 million decline.
Global Market
Wall Street closed unchanged on Friday on the final day of a volatile month dominated by trade policy uncertainty. A pause in the escalation of tariff threats between the US and China, faster-than-expected personal spending in the US and contained inflation all added to sentiment on Friday. In contrast, a decline in oil prices weighed on energy stocks. During the week, Dow Jones surged by 3.01%, Nasdaq gained by 2.72% and S&P 500 rose by 2%.
European stock markets closed mostly in the green on Friday, as investors remained optimistic that the world’s two largest economies would be able to resolve their trade dispute after Chinese foreign ministry confirmed that talks were continuing between Washington and Beijing. During the week, DAX gained 2.82% and FTSE rose by 1.60%.
Indian Market
Sensex and Nifty gained by 1.72% and 1.80% respectively during last week.
Indian Government on Friday unveiled a mega plan to merge 10 public sector banks into four as part of plans to create fewer and stronger global-sized lenders as it looks to boost economic growth from a six-year low.
The Indian economy advanced 5% (Y-o-Y) during Q1Fy20, slowing from a 5.8% expansion in the prior period and missing market consensus of 5.7%. It was the weakest growth rate since the first quarter of 2013, amid a slowdown in manufacturing and construction sectors.
India’s fiscal deficit widened to Rs 5.48 trillion in April-July 2019-20 from Rs 5.40 trillion in the same period of the previous fiscal year. That was equivalent to 77.8% of the government’s budget estimate for this financial year, compared to 86.5% in the same period last year.
Adani Ports aims to double its volume, revenue, and profit over the next five years (FY19-24). It expects volume growth to be driven by containers, led by India’s gross domestic product growth and containerisation of cargo, from the current 65% to 90%. Containers are expected to grow by 14% annually over the five-year period. Company also aiming to increase its market share by 300 basis points to 25% by 2024-25.
Sectoral Indices Trends:
The sectoral indices mostly closed in negative territory during last week. The S&P BSE Bankex, Oil & Gas, PSU and Auto indices had declined by -4.53%, -2.67%, -5.01% and -0.11% respectively. S&P BSE IT gained by 3.15%.
SBI Bank Witnesses rise in turnover in Stock Derivatives
SBI Bank has witnessed rise in open interest in the stock future segment in the last week. Share price of SBI Bank declined by 2.5% during last week. Indian Government on Friday unveiled a mega plan to merge 10 public sector banks into four as part of plans to create fewer and stronger global-sized lenders as it looks to boost economic growth from a six-year low. Punjab National Bank, Oriental Bank of Commerce and United Bank of India will combine to form the nation’s second-largest lender; Canara Bank and Syndicate Bank will merge; Union Bank of India will amalgamate with Andhra Bank and Corporation Bank; and Indian Bank will merge with Allahabad Bank.
Foreign Institutional Investors (FIIs) Derivative Statistics have shown rise in the open interest across Stock Options, Index futures, Index options and Stock futures on a week on week basis.
Currency
Indian rupee appreciated by 0.084% against USD, USD/INR pair closed at Rs. 71.45 in the last week.
