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NEWS U CAN USE
January 14, 2022
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The Week that was…
10
th
January to 14
th
January
2
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Indian Economy
Consumer price index-based inflation (CPI) rose to 5.59% in Dec 2021 as against 4.91% in
the prior month. Consumer Food Price Index (CFPI) also rose 4.05% as compared to 1.87%
in the previous month. The CPI is closer to Reserve Bank of India’s (RBI) upper tolerance
limit of 6%.
Index of industrial production (IIP) witnessed a growth of 1.4% in Nov 2021 as compared
to a growth of 4.0% in the previous month and contraction of 1.6% in the same period of
the previous year. For the fiscal year till date, IIP witnessed a growth of 17.4% as compared
to a contraction of 15.3% in the same period of the previous year. The mining sector
witnessed a growth of 5.0% in Nov 2021 as compared to a contraction of 5.4% in the same
period of the previous year. The manufacturing sector witnessed a growth of 0.9% in Nov
2021 as compared to contraction of 1.6% in the same period of the previous year.
India’s WPI based inflation eased marginally to 13.56% YoY in Dec 2021 from 14.23% in
Nov 2021 and 13.83% in Oct 2021. WPI based rate of inflation in the same period of the
previous year stood at 1.95%. The growth of WPI Food index stood at 9.24% in Dec 2021
as against 6.70% in Nov 2021 and 4.25% in Oct 2021.
Government data showed that India’s merchandise trade deficit widened to $21.68 billion
in Dec 2021 from $15.72 billion in Dec 2020. The trade deficit thus widened by 37.92%.
Merchandise exports grew 38.91% YoY to $37.81 billion in Dec 2021 from $27.22 billion in
Dec 2020. Merchandise imports grew 38.55% YoY to $59.48 billion in Dec 2021 from
$42.93 billion in Dec 2020.
3
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4
Domestic Equity Market Indices
Indices 14-Jan-22 1 Week Return YTD Return
S&P BSE Sensex
61,223.03 2.47% 5.10%
Nifty 50
18,255.75 2.49% 5.20%
S&P BSE Mid-Cap
26,085.24 2.40% 4.47%
S&P BSE Small-Cap
30,951.28 3.06% 5.07%
Source: MFI Explorer
NSE Advance/Decline Ratio
Date Advances Declines
Advance/Decline Ratio
10-Jan-22 1,538 628 2.45
11-Jan-22 1,036 1,111 0.93
12-Jan-22 1,148 975 1.18
13-Jan-22 1,110 989 1.12
14-Jan-22 1,239 848 1.46
Source: NSE
Indian equity markets struggled with
the existing pandemic situation to end
the week with moderate gains. After
three months of continues selling
pressure, foreign investors turned net
buyers during the week which provided
some support to the market sentiment.
Market participants are also expecting
good corporate earnings for the
quarter ended Dec 2021.
However, gains were capped after
retail inflation jumped to 5.59% in Dec,
although the same remained within the
RBI's tolerance level for the sixth
consecutive month. In a separate set of
data released by the government,
industrial production rose 1.4% in Nov
2021, which provided intermittent
relief.
Ratios
S&P BSE
Sensex
Nifty 50
S&P BSE
Mid Cap
S&P BSE
Small Cap
P/E
29.04 25.30 27.78 48.05
P/B
3.78 4.60 3.21 3.58
Dividend Yield
0.89 1.12 0.89 0.64
Source: BSE, NSE Va
lue as on Jan 14, 2022
Indian Equity Market
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5
Sectoral Indices
Indices
Last
Closing*
Returns (in %)
1-Wk 1-Mth
S&P BSE Auto
26,294.76 2.81% 6.00%
S&P BSE Bankex
43,771.05 1.68% 4.42%
S&P BSE CD
45,833.82 0.74% 6.21%
S&P BSE CG
30,875.16 6.14% 7.80%
S&P BSE FMCG
13,932.85 -0.03% 0.96%
S&P BSE HC
25,767.26 0.52% 2.02%
S&P BSE IT
38,441.55 3.18% 8.52%
S&P BSE Metal
20,344.81 2.47% 2.71%
S&P BSE Oil & Gas
18,873.11 2.35% 3.43%
Source: Refinitiv *Value as on Jan 14, 2022
On the BSE sectoral front, barring S&P BSE
FMCG, all the major indices closed in the
green. S&P BSE Power was the top gainer, up
7.44%, followed by S&P BSE Capital Goods and
S&P BSE Realty which went up 6.14% and
4.89%, respectively.
Indian Derivatives Market Review
Nifty Jan 2022 Futures stood at 18,295.00, a premium of 39.25 points above the spot
closing of 18,255.75. The total turnover on NSE’s Futures and Options segment for the
week stood at Rs. 389.77 lakh crore as against Rs. 459.50 lakh crore for the week to Jan 7.
The Put-Call ratio stood at 0.88, compared with the previous week’s close of 0.87.
The Nifty Put-Call ratio stood at 1.25 compared with the previous week’s close of 1.26.
Indian Equity Market (contd.)
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6
Debt Indicators
(%)
Current
Value
1-Wk
Ago
1-Mth
Ago
6-Mth
Ago
Call Rate
3.42 3.26 3.29 3.21
91 Day T-Bill
3.59 3.60 3.52 3.44
05.22% 2025, (5 Yr GOI)
5.59 5.63 5.37 5.52
06.10% 2031, (10 Yr GOI)
6.58 6.54 6.36 6.11
Source: Refinitiv Value as on Jan 14, 2022
Bond yields rose amid cautiousness
following a further rise in U.S. Treasury
yields and concerns over rise in domestic
inflationary pressures. Yields also rose
after weekly government security
auction witnessed devolvement on
primary dealers.
However, losses were limited after RBI
included a new 10-year note in the
weekly auction and also did not
announce the rollover of a 3-day variable
rate reverse repo auction.
Yield on the 10-year benchmark paper
(6.10% GS 2031) rose 4 bps to close at
6.58% from the previous week’s close of
6.54%.
Domestic Debt Market
6.52
6.57
6.62
10-Jan 11-Jan 12-Jan 13-Jan 14-Jan
Yield in %
10 -Yr Benchmark Bond ( % )
Source: CCIL
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7
Maturity
G-Sec Yield
(%)
Corporate Yield
(%)
Spread
bps
1 Year 4.42 4.78 36
3 Year 5.39 5.75 36
5 Year 6.07 6.55 48
10 Year 6.69 7.43 74
Source: Refinitiv Value as on
Jan 14, 2022
Yields on gilt securities fell across 1 to 5-year paper
in the range of 2 bps to 7 bps and expanded across
the remaining maturities by up to 5 bps barring 13
and 14-year paper which closed steady.
Corporate bond yields fell across the maturities in
the range of 9 bps to 30 bps barring 15-year paper
which increased 29 bps.
Difference in spread between AAA corporate bond
and gilt contracted across the maturities in the
range of 11 bps to 31 bps barring 15-year paper
which expanded 27 bps.
Domestic Debt Market (Spread Analysis)
-10
-1
8
3.00
5.20
7.40
3 Mths 6 Mths 1 Yr 5 Yrs 10 Yrs 19 Yrs 30 Yrs
India Yield Curve Shift (%) (W-o-W)
Change in bps 14-Jan-22 07-Jan-22
Yield in %
Change in bps
Source: Refinitiv
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8
The Reserve Bank of India's Governor chaired a sub-committee of the Financial Stability and
Development Council (FSDC) that assessed the economic situation in the context of the
COVID-19 epidemic and resolved to keep a careful eye on the unfolding events in order to
ensure financial stability.
According to RBI’s Annual Report of the Ombudsman Schemes for the year 2020-21, the top
five grounds of complaints received at the Office of Banking Ombudsman (OBO) between
Jul 2020 and Mar 2021 were ATM/ debit cards, mobile/ electronic banking, credit cards,
failure to meet obligations, and non-observance of the fair practises code.
According to the Union Minister of Commerce and Trade, India and the U.K. has launched
formal negotiations for the free trade agreement. The agreement, according to the
minister, will boost collaboration in tourism, technology, startups, education, climate
change, and other areas.
According to the Centre for Monitoring Indian Economy, offtake of credit from scheduled
commercial banks to medium, micro and small industrial enterprises has soared currently
due to government’s emergency credit line guarantee scheme (ECLGS). ECLGS loans are top-
up loans designed to assist existing businesses in overcoming challenges resulting from
lockdowns and other pandemic-related ill-effects.
Regulatory Updates in India
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9
The Insurance Regulatory and Development Authority of India (IRDAI) has told health
insurers not to dismiss Covid's antibody cocktail therapy claims as "experimental." The
regulator has instructed insurers to evaluate all refused or deducted claims and take
appropriate action to pay them in accordance with policy conditions.
According to the Ministry of Heavy Industries, a total of 115 companies filed their
applications under the Production Linked Incentive Scheme for Automobile and Auto
Component Industry in India. The Production Linked Incentive Scheme is expected to
facilitate the Indian Automobile industry to move up the value chain into higher value-
added products and thus help the country to move to a environmentally cleaner,
sustainable, advanced and more efficient Electric Vehicles (EV) based system.
Regulatory Updates in India (contd..)
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According to the Labor Department, U.S. consumer price index rose 0.5% MoM in Dec 2021
following a 0.8% rise in Nov 2021. U.S. core consumer prices rose 0.6% MoM in Dec after
rising 0.5% in Nov.
According to the Commerce Department, U.S. retail sales fell 1.9% in De 2021 after
increasing revised 0.2% in Nov 2021.
According to the Labor Department, U.S. import prices fell 0.2% in Dec 2021 after rising
0.7% in Nov 2021. Export prices fell 1.8% in Dec 2021 after increasing by a downwardly
revised 0.8% in Nov.
According to the Office for National Statistics, U.K. gross domestic product rose 0.9% MoM
in Nov 2021 as against 0.2% expansion registered in Oct 2021.
According to Destatis, Germany’s gross domestic product grew 2.7% in 2021 as against
4.6% decline in 2020. The German economy only saw a minor rebound in 2021 despite the
Covid-19 restrictions and supply chain disruptions impacting hard on German industry.
According to the National Bureau of Statistics, China’s consumer price slowed to 1.5% in
Dec 2021 as against 2.3% rise in Nov 2021. The ease in inflation came largely due to the fall
in food prices.
According to the Bank of Japan, producer prices in Japan fell 0.2% MoM in Dec 2021
following upwardly revised 0.7% in Nov 2021. On a yearly basis, producer prices rose 8.5%
YoY down from the upwardly revised 9.2% in the previous month.
10
Global News/Economy
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11
Global Indices
Indices
14-Jan-22
1-Week
Return
YTD
Return
Russell 3000 2,298.47 -0.96% -5.79%
Nasdaq 100 15,611.59 0.12% -4.34%
FTSE 100 7,542.95 0.77% 2.15%
DAX Index 15,883.24 -0.40% -0.01%
Nikkei Average 28,124.28 -1.24% -2.32%
Straits Times 3,281.97 2.39% 5.07%
Source: Refinitiv *Value as on Jan 14, 2022
U.S.
U.S. markets mostly went down,
dragged by a slew of disappointing
economic data. A steep drop in U.S.
retail sales in Dec 2021 dampened
sentiments. Additionally, inflation
concerns also contributed to a bigger
than expected drop in U.S. consumer
sentiment in Jan 2022. A modest
decrease in U.S. industrial production in
Dec 2021 too added to the losses.
Europe
European markets too witnessed selling pressure following hawkish comments from U.S.
Federal Reserve Chair, who indicated this week that interest rates are likely to rise this
year. However, the UK economy expanded at a faster pace in Nov 2021 which contributed
to the upside to some extent.
Asia
Asian market witnessed mixed trend as investors remained worried over corona virus
situation and its likely impact on the economic recovery. However, the much-waited U.S.
Dec inflation number came in line with market expectations which provided underlying
support to the bourses.
Global Equity Markets
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12
Yields on the 10-year U.S. Treasury rose 2
bps to close at 1.79%, from the previous
week’s close of 1.77%.
U.S. Treasury prices rose initially following
upbeat demand at an auction of U.S. 30-
year bonds on Jan 13, 2022.
The trend reversed on the penultimate
day of the week after U.S. Federal
Reserve officials before their upcoming
policy meeting in Jan 2022 indicated
they'll likely start raising interest rates as
early as Mar 2022 to rein in high inflation
and achieve price stability. Market
participants are also of the view that the
recent batch of soft economic data on
consumer and manufacturing activity will
not be enough to derail the U.S. Federal
Reserve's path of tightening policy.
Global Debt (U.S.)
1.68
1.72
1.76
1.80
10-Jan 11-Jan 12-Jan 13-Jan 14-Jan
Yield in %
US 10-Year Treasury Yield Movement
Source: Refinitiv
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13
Performance of various commodities
Commodities
Last Closing* 1-Week Ago
Brent Crude($/Barrel)
88.48 83.02
Gold ($/Oz)
1,817.22 1,795.63
Gold (Rs/10 gm)
47,851 47,395
Silver ($/Oz)
22.95 22.30
Silver (Rs/
Kg) 61,558 59,924
Source: Refinitiv *Value as on Jan 14, 2022
Gold
Gold prices edged higher as markets
awaited economic data to gauge the pace
of upcoming U.S. rate increases. Gains were
restricted as U.S. Federal Reserve
policymakers signaled that they may start
raising interest rates in Mar to fight
inflation.
Brent Crude
Brent Crude rose during the week under
review boosted by supply constraints and a
weaker dollar, although an imminent
release of crude reserves from China
looms, keeping gains under pressure.
Baltic Dry Index
The index fell during the week due to
sluggish capesize and panamax activities.
Commodities Market
9.00
10.00
11.00
12.00
14-Dec-21 29-Dec-21 13-Jan-22
Global Commodity Movement
Gold Spot ($/Oz) Silver Spot ($/Oz) Brent ($/bbl)
Global Commodity Prices
Rebased to 10
Source: Refinitiv
2.92%
6.58%
1.20%
14-Jan-22
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14
Movement of Rupee vs Other Currencies
Currency
Last Closing* 1-Wk Ago
US Dollar
74.12 74.29
Pound Sterling
101.79 100.61
EURO
85.07 83.97
100 Yen
65.17 64.08
Source: Refinitiv Figures in INR , *
Value as on Jan 14, 2022
Rupee
The Indian rupee gained against the U.S. dollar
following gains in most regional peers and
domestic equity market.
Euro
Euro rose against the U.S. dollar after U.S.
consumer inflation surged as expected in Dec
2021, which fell short of offering any new
impetus for the U.S. Federal Reserve's policy
normalization efforts.
Pound
Sterling gained against the U.S. dollar
supported by expectations that the Bank of
England will raise interest rates further.
Yen
Yen surged against the U.S. dollar after U.S.
consumer inflation surged as expected in Dec
2021, which fell short of offering any new
impetus for the U.S. Federal Reserve's policy
normalization efforts.
Currencies Markets
9.50
9.60
9.70
9.80
9.90
10.00
10.10
10.20
14-Dec-21 29-Dec-21 13-Jan-22
USD GBP Euro JPY
Source: Refinitiv
Currency Prices ( in terms of INR)
Rebased to 10
Currency Movement
1.32%
1.17%
-0.24%
1.70%
14-Jan-22
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15
The Week that was…
10
th
January to 14
th
January
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16
The Week that was (January 10 January 14)
Date Events Present Value Previous Value
Monday,
January 10, 2022
• Eurozone Unemployment Rate(Nov) 7.20% 7.30%
• Eurozone Sentix Investor Confidence(Jan) 14.9 13.5
Tuesday,
January 11, 2022
• Japan Coincident Index (Nov) PREL 93.6 89.8
• U.S. NFIB Business Optimism Index(Dec) 98.9 98.4
Wednesday,
January 12, 2022
• India Consumer Price Index (YoY)(Dec) 5.59% 4.91%
• India Industrial Production (YoY) (Nov) 1.40% 4.00%
• China Consumer Price Index (YoY)(Dec) 1.50% 2.30%
• U.S. Consumer Price Index (YoY)(Dec) 7.00% 6.80%
• Germany Wholesale Price Index (YoY)(Dec) 16.1% 16.60%
Thursday
January 13, 2022
• U.S. Producer Price Index (YoY)(Dec) 9.70% 9.80%
• China FDI - Foreign Direct Investment (YTD) (YoY)(Dec) 14.90% 15.90%
Friday,
January 14, 2022
• U.S. Retail Sales (MoM)(Dec) -1.90% 0.20%
• U.S. Michigan Consumer Sentiment Index(Jan) PREL 68.8 70.6
• China Trade Balance (USD) (Dec) 94.46B 71.72B
• U.K. Gross Domestic Product (MoM)(Nov) 0.90% 0.20%
• U.K. Industrial Production (MoM)(Nov) 1% -0.50%
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17
The Week Ahead
17
th
January to 21
st
January
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18
Day Event
Monday,
January 17, 2022
China Gross Domestic Product (YoY)(Q4)
China Retail Sales (YoY)(Dec)
Japan Machinery Orders (YoY)(Nov)
Tuesday,
January 18, 2022
Bank of Japan Interest Rate Decision
U.K. ILO Unemployment Rate (3M) (Nov)
Eurozone ZEW Survey – Economic Sentiment (Jan)
Wednesday,
January 19, 2022
U.K. Consumer Price Index (YoY)(Dec)
Germany Harmonized Index of Consumer Prices (YoY)(Dec)
U.S. Housing Starts (MoM)(Dec)
U.K. Retail Price Index (YoY)(Dec)
Thursday,
January 20, 2022
People’s Bank of China Interest Rate Decision
Eurozone Consumer Price Index (MoM)(Dec)
Japan Merchandise Trade Balance Total(Dec)
Germany Producer Price Index (MoM)(Dec)
Friday,
January 21, 2022
Japan National Consumer Price Index (YoY)(Dec)
U.K. GfK Consumer Confidence (Jan)
U.K. Retail Sales (YoY)(Dec)
The Week Ahead
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The information herein is meant only for general reading purposes and contains all factual and statistical information pertaining to Industry and
markets which have been obtained from independent third party sources and which are deemed to be reliable. The information provided cannot be
considered as guidelines, recommendations or as a professional guide for the readers. It may be noted that since Nippon Life India Asset
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reasonableness of the assumptions upon which such data and information has been processed or arrive data; NAM India does not in any manner
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19
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