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NEWS U CAN USE
Aug 23, 2024
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The Week that was…
19
th
Aug to 23
rd
Aug
2
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Indian Economy
• According to the Ministry of Labour and Employment, net formal job creation under the
Employees’ Provident Fund Organisation (EPFO) reached 1.92 million in Jun 2024, driven
by enhanced employment opportunities, a heightened awareness of employee benefits,
and the successful implementation of EPFO’s outreach initiatives.
• According to the Department of Economic Affairs, India retained its growth momentum in
Q1FY25. India's key economic indicators indicate a favourable outlook, supported by
strong domestic activity, enhanced external trade, and increasing capital inflows. It also
showed that perceived employment conditions show mixed signals, overall growth
indicators suggest sustained momentum as FY25 progresses.
• According to the Engineering Exports Promotion Council, India's engineering goods
exports maintained a positive trend in Jul 2024, achieving a YoY growth of 3.6%, which
highlights the sector's robustness. In Jul 2024, the exports amounted to $9.04 billion, an
increase from $8.72 billion in the same month last year.
• According to reports, foreign direct investment inflows surged by 26.4% to reach $22.4
billion from Apr to Jun 2024, showing strong growth as global cross-border investments
increase. In the prior quarter, gross inflows had also grown by around 23%, even though
FDI had decreased over the last two financial years. Recent figures from the RBI’s bulletin
showed a 37.6% increase in inflows for Jun 2024, which was less than the 49% growth
recorded in May 2024.
3
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4
Domestic Equity Market Indices
Indices
23-Aug-24 1 Week Return YTD Return
BSE Sensex
81,086.21 0.81% 12.25%
Nifty 50
24,823.15 1.15% 14.23%
BSE Mid
-Cap 48,321.92 1.96% 31.17%
BSE Small
-Cap 55,681.89 3.39% 30.48%
Source: Refinitiv
Values as on Aug 23, 2024
• Domestic equity markets rose for the
second consecutive week as key
benchmark indices BSE Sensex and
Nifty 50 rose 0.81% and 1.15%,
respectively. The rally was broad-based
as the mid-cap segment and the small-
cap segment closed the week in green.
• Domestic equity markets experienced
gains during the week, fueled by
anticipation that the U.S. Fed
Chairperson might deliver distinct
indications regarding the probable
magnitude of a rate reduction in Sep
2024, during the forthcoming Jackson
Hole Symposium on Aug 23, 2024.
Gains were extended following a fall in
global crude oil prices due to ease in
geopolitical tensions after Israel has
accepted a proposal to bridge
differences holding up a cease-fire and
hostage release in Gaza.
Ratios
BSE Sensex
Nifty 50 BSE Mid Cap
BSE Small
Cap
P/E
23.78 23.06 32.97 35.57
P/B
4.09 4.18 4.38 4.13
Dividend Yield
1.13 1.23 0.86 0.54
Source: NSE, BSE
Values as on Aug 23, 2024
Indian Equity Market
NSE Advance/Decline Ratio
Date
Advances Declines Advance/Decline Ratio
19-Aug-24 1,917 788 2.43
20-Aug-24 1,679 1,012 1.66
21-Aug-24 1,736 969 1.79
22-Aug-24 1,672 1,039 1.61
23-Aug-24 1,266 1,421 0.89
Source: NSE
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5
Sectoral Indices
Indices
Last Returns (in %)
Closing 1-Wk 1-Mth
BSE Auto
58,433.00 1.05% 2.04%
BSE Bankex
58,038.72 0.70% -2.22%
BSE CD
63,088.58 3.99% 6.86%
BSE CG
73,356.70 0.70% 3.03%
BSE FMCG
23,066.86 2.16% 2.31%
BSE HC
42,110.93 2.29% 8.70%
BSE IT
41,868.12 0.77% 2.30%
BSE Metal
32,184.62 4.37% 2.06%
BSE Oil & Gas
32,173.80 0.90% 5.95%
Source:BSE
Values as on Aug 23, 2024
• On the BSE sectoral front, BSE Metal rallied
4.37% after the Directorate General of Trade
Remedies of India launched an antidumping
investigation into hot-rolled coil imports from
Vietnam. Furthermore, investors responded
favorably for the domestic metal sector
following China's monthly steel production data
that declined 9% on monthly basis in Jul 2024.
• BSE Consumer Durables rose 3.99% on
expectation of sales growth during the
upcoming festive seasons.
Indian Derivatives Market Review
• Nifty Aug 2024 Futures stood at 24,854.00, a premium of 30.85 points above the spot
closing of 24,823.15.
• The total turnover on NSE’s Futures and Options segment for the week stood at Rs.
1,922.24 lakh crore as against Rs. 1,507.92 lakh crore for the week to Aug 16.
• The Put-Call ratio stood at 0.93 compared with the previous week’s close of 0.88.
• The Nifty Put-Call ratio stood at 0.67 compared with the previous week’s close of 1.31.
Indian Equity Market (contd.)
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6.84
6.85
6.86
6.87
6.88
19-Aug 20-Aug 21-Aug 22-Aug 23-Aug
Yield in %
10 -Yr Benchmark Bond ( % )
Source: CCIL
6
Debt Indicators
(%)
Current
Value
1-Wk
Ago
1-Mth
Ago
6-Mth
Ago
Call Rate
6.53 6.52 6.67 6.68
91 Day T-Bill
6.65 6.63 6.75 7.05
07.06% 2028, (5 Yr GOI)
6.79 6.79 6.91 7.08
07.10% 2034, (10 Yr GOI)
6.86 6.87 6.97 7.08
Source: Refinitiv Values as on Aug 23, 2024
• Bond yields fell marginally during the
week, while market participants awaited
for fresh cues, focus remained on the
speech of the U.S. Fed’s Chairperson at
the Jackson Hole symposium on Aug 23,
2024, where market participants are
expecting of a hint of rate cut in Sep
2024.
• Yield on the 10-year benchmark paper
(7.10% GS 2034) fell by 1 bps to close at
6.86% from the previous week’s close of
6.87%.
• Data from Reserve Bank of India showed
that India's foreign exchange reserves
increased to $674.66 billion for the week
ended Aug 16, 2024 compared with
$670.12 billion a week earlier.
Domestic Debt Market
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-4
-2
0
2
4
6.40
6.60
6.80
7.00
7.20
3 Mths 6 Mths 1 Yr 5 Yrs 10 Yrs 20 Yrs 30 Yrs
India Yield Curve Shift (%) (W-o-W)
Change in bps 23-Aug-24 16-Aug-24
Yield in %
Change in bps
Source: Refinitiv
7
Maturity
G-Sec Yield
(%)
Corporate Yield
(%)
Spread
bps
1 Year 6.84 7.6 76
3 Year 6.87 7.42 55
5 Year 6.90 7.42 52
10 Year 6.98 7.45 47
Source: Refinitiv
Values as on Aug 23, 2024
• Yields on gilt fell up to 4 bps across the maturities,
barring 3 year paper that rose by 4 bps, while 4 & 19
year papers were unchanged.
• Corporate bond yields moved by 1 bps across the
curve, barring 2 year paper that fell by 2 bps.
• Difference in spread between AAA corporate bond
and gilt remained steady or contracted by 1 bps
across the segments, barring 1, 2 & 15 year papers
that expanded by 2 or 4 bps and 3 year paper that
contracted 4 bps.
Domestic Debt Market (Spread Analysis)
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8
• The finance minister conducted a review of the performance of Public Sector Banks (PSBs),
concentrating on essential financial metrics including deposit mobilization, digital payment
systems, cybersecurity measures, and the rollout of new credit products and initiatives.
During the review, the finance minister underscored the necessity for Public Sector Banks
(PSBs) to initiate targeted campaigns aimed at increasing deposit collections and improving
customer service, especially in rural and semi-urban regions.
• The Securities and Exchange Board of India plans to broaden its sustainable finance
framework to add more products which could benefit ESG-labelled instruments in Asia. SEBI
will discuss the possibility of adding social bonds, as well as sustainable and sustainability-
linked bonds, to the existing range of environmental, social, and governance debt.
• The Deputy Governor of the Reserve Bank of India has indicated that a regular increase in
the deposit insurance coverage limit, which is presently set at Rs. 5 lakh, may be necessary.
This recommendation is based on several considerations, including the growth in deposit
values, inflation rates, and rising income levels. He stated that, as of Mar 31, 2024, fully
protected accounts in India represent 97.8% of the total accounts within the banking
system, significantly exceeding the international standard of 80%.
Regulatory Updates in India
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9
• The Reserve Bank of India (RBI) has implemented stricter regulations for peer-to-peer
(P2P) lenders after several of them were found to be having hundreds of crores of rupees
in escrow accounts in violation of guidelines for the platform providers. The revised
guidelines clarify the activities that non-banking finance companies (NBFCs) cannot
undertake in the P2P business, including the assumption of credit risk. The aim is to curb
the irregular practices in the industry.
• According to a circular, IRDAI has instructed insurers to start uploading verified KYC details
of all existing policyholders in the Central KYC Records Registry (CKYCRR). While SEBI has
instructed KYC registration agencies (KRAs) to upload verified KYC information for all
capital market investors into the CKYCRR starting Aug 1, 2024. This development leads
towards the implementation of uniform KYC in the financial services industry which opens
door for mutual fund distributors and insurance agents to use CKYC data of each other.
• SEBI has released a Cyber security and Cyber Resilience (CSCR) framework for entities it
regulates. This includes AIFs, collective investment schemes, clearing corporations,
investment advisors, research analysts, KYC registration agencies, mutual funds, asset
management companies, portfolio managers, registrar and transfer agents, and venture
capital funds. These entities will be responsible for any breaches of cyber security rules.
SEBI stated that intermediaries must comply with all laws, regulations, and circulars from
SEBI and the Government of India, and they will be held liable for any violations.
Regulatory Updates in India (contd..)
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• The U.S. Federal Reserve Chair appeared to affirm the prevailing expectations that the
central bank is ready to initiate a reduction in interest rates during a much-anticipated
speech at the Jackson Hole Economic Symposium in Wyoming on 23rd Aug, 2024. Further,
the Fed Chair said that inflation is now much closer to the U.S. Fed's objective, with
consumer prices rising 2.5% YoY in Jul 2024, and noted progress toward 2% has resumed
after a pause earlier this year. Additionally, the U.S. Federal Reserve Chair indicated that
the rise in the unemployment rate is primarily due to a significant influx of workers into the
labor market and a deceleration from the previously rapid hiring rates, rather than a surge
in layoffs.
• According to Eurostat, eurozone’s harmonized index of consumer prices climbed 2.6% YoY
in Jul 2024, slightly faster than the 2.5% increase in Jun 2024. The rate matched the
estimate published on Jul 31, 2024. Core inflation, that strips out prices of energy, food,
alcohol and tobacco, held steady at 2.9%, as estimated.
• The People's Bank of China left its benchmark lending rates unchanged on 20th Aug, 2024
after cutting the rates unexpectedly by 10 basis points on 22nd Jul, 2024. China's central
bank kept its one-year loan prime rate unchanged at 3.35%. Similarly, the five-year LPR, the
benchmark for mortgage rates, was retained at 3.85%.
• According to the Ministry of Internal Affairs and Communications, Japan’s core inflation,
which excludes prices of fresh food, rose marginally to 2.7% in Jul 2024 from 2.6% in Jun
2024. The increase was largely driven by the 12.0% surge in energy prices.
10
Global News/Economy
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11
Global Indices
Indices
23-Aug-24
1-Week
Return
YTD
Return
Russell 3000 2,905.45 1.35% 20.92%
Nasdaq 100 19,720.87 1.09% 17.21%
FTSE 100 8,327.78 0.20% 7.69%
DAX Index 18,633.10 1.70% 11.23%
Nikkei Average 38,364.27 0.79% 14.64%
Straits Times 3,387.99 1.05% 4.56%
Source: Refinitiv Value as on Aug 23, 2024
U.S.
• U.S. equity markets rose as highly
anticipated remarks by the U.S. Federal
Reserve Chair at Jackson Hole indicated
the central bank is prepared to begin
lowering interest rates. The remarks by
the U.S. Federal Reserve Chair came as
recent inflation data, has bolstered
expectations that the Federal Reserve
will lower interest rates during its
upcoming monetary policy meeting in
Sep 2024.
Europe
• European equity markets rose as investors responded to the U.S. Federal Reserve Chair's
speech at Jackson Hole, which appeared to affirm the anticipation that the central bank is
ready to initiate a reduction in interest rates.
Asia
• Asian equity markets mostly rose as the market participants awaited the U.S. Federal
Reserve Chair's keynote address at the Jackson Hole Symposium, which is anticipated to
offer enhanced insight into the potential easing of monetary policy.
Global Equity Markets
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3.70
3.75
3.80
3.85
3.90
19-Aug 20-Aug 21-Aug 22-Aug 23-Aug
Yield in %
US 10-Year Treasury Yield Movement
Source: Refinitiv
12
• Yields on the 10-year U.S. Treasury fell
by 8 bps to close at 3.81% from the
previous week’s close of 3.89%.
• U.S. Treasury prices rose following the
remarks of the U.S. Federal Reserve
Chair at the Jackson Hole Economic
Symposium in Wyoming on 23rd Aug,
2024 where he provided his most
definitive indication to date that
interest rates are expected to decrease,
likely during the upcoming policy
meeting in Sep 2024.
• Further, prices rose as the revisions to
employment data as the Bureau of
Labor Statistics revised payrolls in the
Apr 2023-Mar 2024 period to show a
0.5% reduction in jobs.
Global Debt (U.S.)
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8.00
8.50
9.00
9.50
10.00
10.50
11.00
23-Jul-24 8-Aug-24
Global Commodity Movement
Gold Spot ($/Oz) Silver Spot ($/Oz) Brent ($/bbl)
Global Commodity Prices
Rebased to 10
Source: Refinitiv
13
Performance of various commodities
Commodities
Last Closing* 1-Week Ago
Brent Crude($/Barrel)
82.52 82.76
Gold ($/Oz)
2,512.07 2,507.28
Gold (Rs/10 gm)
71,096 70,265
Silver ($/Oz)
29.82 29.01
Silver (Rs/Kg)
84,230 81,482
Source: Refinitiv *Value as on Aug 23, 2024
Gold
• Gold prices rose as the U.S. Federal Reserve
Chair’s Jackson Hole speech seemingly
confirmed expectations that the U.S.
central bank is prepared to begin lowering
interest rates. The remarks by the U.S.
Federal Reserve came as recent inflation
data, which bolstered expectations that
the U.S. Federal Reserve will lower interest
rates during its upcoming monetary policy
meeting in Sep 2024.
Brent Crude
• Brent crude oil prices fell marginally on
concerns about the outlook for demand
from China. Easing geopolitical tensions
also weighed on oil prices.
Baltic Dry Index
• The index rose over the week due to
improved capesize and panamax activities.
Commodities Market
23-Aug-24
-0.29%
0.19%
2.79%
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9.00
9.50
10.00
10.50
11.00
11.50
23-Jul-24 8-Aug-24
USD GBP Euro JPY
Source: Refinitiv
Currency Prices ( in terms of INR)
Rebased to 10
Currency Movement
14
Movement of Rupee vs Other Currencies
Currency
Last Closing* 1-Wk Ago
US Dollar
83.87 83.96
Pound Sterling
110.07 108.15
EURO
93.34 92.22
100 Yen
57.68 56.37
Source: Refinitiv Figures in INR , *Value as on Aug
23, 2024
Rupee
• The Indian rupee in the spot trade rose against
the U.S. dollar as investors awaited remarks
from the U.S. Federal Reserve Chair and market
expectations for interest rate cuts in Sep 2024.
Euro
• The euro rose against the greenback following
a clear indication from the U.S. Fed Chair that
the long-awaited reduction in U.S. interest rates
is expected to occur next month.
Pound
• Pound rose against the U.S. dollar after data
showed employers added 818,000 fewer jobs in
the U.S. in the year to Mar 2024 than previously
thought.
Y
en
• Yen rose against the U.S. dollar after a clear
indication from the Chair of the U.S. Fed, it is
anticipated that the long-anticipated decrease
in U.S. interest rates will take place next month.
Currencies Markets
23-Aug-24
-0.10%
2.32%
1.21%
1.78%
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15
The Week that was…
19
th
Aug to 23
rd
Aug
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16
The Week that was (Aug 19 – Aug 23)
Date Events
Present
Value
Previous
Value
Monday,
August 19, 2024
• China FDI - Foreign Direct Investment (YTD) (YoY) (Jul) -29.60% -29.10%
• U.S. 6-Month Bill Auction 4.77% 4.80%
Tuesday,
August 20, 2024
• People's Bank of China Interest Rate Decision 3.35% 3.35%
• Germany Producer Price Index (MoM) (Jul) 0.20% 0.20%
• Eurozone Core Harmonized Index of Consumer Prices (YoY) (Jul) 2.90% 2.90%
• Japan Merchandise Trade Balance Total (Jul) ¥-621.8B ¥224B
Wednesday,
August 21, 2024
• U.K. Public Sector Net Borrowing (Jul) £2.177B £12.552B
• U.S. EIA Crude Oil Stocks Change (Aug 16) -4.649M 1.357M
Thursday,
August 22, 2024
• Germany HCOB Composite PMI (Aug) Prel 48.5 49.1
• Eurozone HCOB Manufacturing PMI (Aug) Prel 45.6 45.8
• U.K. S&P Global/CIPS Services PMI (Aug) Prel 53.3 52.5
• U.S. Initial Jobless Claims (Aug 16) 232K 228K
• U.K. GfK Consumer Confidence (Aug) -13 -13
• Japan National Consumer Price Index (YoY) (Jul) 2.80% 2.80%
Friday,
August 23, 2024
• India Foreign Exchange Reserves AUG/16 $674.66B $670.12B
• U.S. New Home Sales (MoM) (Jul) 0.739M 0.668M
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17
The Week Ahead
26
th
Aug to 30
th
Aug
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18
The Week Ahead
Day Event
Monday,
Aug 26, 2024
• Germany IFO – Business Climate (Aug)
• U.S. Durable Goods Orders (Jul)
Tuesday,
Aug 27, 2024
• Germany Gross Domestic Product (YoY) (Q2)
• U.S. Housing Price Index (MoM) (Jun)
• U.S. Consumer Confidence (Aug)
Wednesday,
Aug 28, 2024
• Eurozone M3 Money Supply (3m) (Jul)
• U.S. MBA Mortgage Applications (Aug 23)
Thursday,
Aug 29, 2024
• Germany Consumer Price Index (MoM) (Aug) Prel
• U.S. Core Personal Consumption Expenditures (QoQ) (Q2) Prel
• U.S. Gross Domestic Product Annualized (Q2) Prel
• U.S. Initial Jobless Claims (Aug 23)
• U.S. Pending Home Sales (MoM) (Jul)
• Japan Retail Trade (YoY) (Jul)
Friday,
Aug 30, 2024
• India Infrastructure Output YoY JUL
• India GDP Growth Rate YoY Q1FY25
• Eurozone Harmonized Index of Consumer Prices (MoM) (Aug) Prel
• U.S. Core Personal Consumption Expenditures - Price Index (MoM) (Jul)
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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
Management Limited (NAM India) has not independently verified the accuracy or authenticity of such information or data, or for that matter the
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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