News You Can Use of 03 May 2024

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NEWS U CAN USE

May 03, 2024

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The Week that was…

Apr to 03

May

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Indian Economy

• According to the Ministry of Commerce & Industry, the combined Index of Eight Core

Industries increased by 5.2% in Mar 2024 as compared to 4.2% in Mar 2023. The

production of all Eight Core Industries recorded growth in Mar 2024 over the

corresponding month of last year except refinery products & fertilizers. Cement witnessed

the maximum growth at 10.6% in Mar 2024 followed by coal with 8.7% growth.

• The Manufacturing Purchasing Managers' Index eased slightly to 58.8 in Apr 2024

compared to 59.1 in Mar 2024 bolstered by strong demand conditions which resulted in a

further expansion of output.

• According to the Ministry of Finance, gross goods and services tax hit a record high in Apr

2024 at Rs. 2.10 lakh crore, representing a significant 12.4% YoY growth driven by a strong

increase in domestic transactions and imports.

• The Organization for Economic Co-operation and Development revised India’s FY25

growth forecast upward to 6.6% from 6.2% projected earlier citing strong investment and

business confidence.

• According to media report, the government has bought over 196 lakh ton of wheat so far

in the ongoing 2024-25 marketing year, surpassing its annual requirement of 186 lakh ton

for all welfare schemes including the National Food Security Act.

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Domestic Equity Market Indices

Indices

03-May-24 1 Week Return YTD Return

S&P BSE Sensex

73,878.15 0.20% 2.27%

Nifty 50

22,475.85 0.25% 3.43%

S&P BSE Mid

-Cap 42,414.53 1.99% 15.13%

S&P BSE Small

-Cap 47,191.41 -0.10% 10.59%

Source: Refinitiv

Values as on May 03, 2024

• Domestic equity markets rose for two

consecutive weeks as key benchmark

indices S&P BSE Sensex and Nifty 50

rose 0.20% and 0.25%, respectively.

The mid-cap segment closed the week

in green, however, the small-cap

segment closed the week in red.

• Domestic equity markets rose as

optimism increased as a result of

increased efforts to mediate a ceasefire

between Israel and Hamas that

reduced geopolitical tensions. Gains

were extended following a strong set

of numbers from index heavyweight

major private sector banks in Mar 2024

quarter. Although, some profit

bookings were witnessed ahead of the

U.S. Fed’s monetary policy outcome,

but sentiment was supported after the

U.S. Fed maintained interest rate with

less hawkish-than-expected comments.

Ratios

S&P BSE

Sensex

Nifty 50

S&P BSE

Mid Cap

S&P BSE

Small Cap

P/E

23.71 21.87 30.48 33.78

P/B

3.60 3.94 3.89 3.63

Dividend Yield

1.20 1.16 0.90 0.63

Source: NSE, BSE

Values as on May 03, 2024

Indian Equity Market

NSE Advance/Decline Ratio

Date

Advances Declines Advance/Decline Ratio

29-Apr-24 1,310 1,286 1.02

30-Apr-24 1,203 1,377 0.87

02-May-24 1,302 1,293 1.01

03-May-24 894 1,694 0.53

Source: NSE

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Sectoral Indices

Indices

Last Returns (in %)

Closing 1-Wk 1-Mth

S&P BSE Auto

51,341.01 2.42% 4.02%

S&P BSE Bankex

55,409.09 1.47% 2.93%

S&P BSE CD

54,810.88 -0.34% 3.26%

S&P BSE CG

62,616.74 -0.79% 0.18%

S&P BSE FMCG

19,603.84 -0.13% 1.11%

S&P BSE HC

35,571.23 0.37% 0.33%

S&P BSE IT

33,901.70 -1.51% -5.55%

S&P BSE Metal

31,828.80 1.38% 7.71%

S&P BSE Oil & Gas

29,145.11 0.74% 2.84%

Source:BSE

Values as on May 03, 2024

• On the BSE sectoral front, S&P BSE Power rose

3.33% amid the increase of India's power

consumption which rose around 11% to 144.25

billion units in April 2024 as compared to the

year-ago period, mainly due increase in

temperatures and increased industrial activities.

• S&P BSE Auto rose 2.42% after major

automakers reported higher sales of cars and

two-wheelers in Apr 2024 from a year earlier.

Indian Derivatives Market Review

• Nifty May 2024 Futures stood at 22,575.20, a premium of 99.35 points above the spot

closing of 22,475.85.

• The total turnover on NSE’s Futures and Options segment for the week stood at Rs.

1536.12 lakh crore as against Rs. 1555.43 lakh crore for the week to Apr 26.

• The Put-Call ratio stood at 1.05 compared with the previous week’s close of 0.9.

• The Nifty Put-Call ratio stood at 0.89 compared with the previous week’s close of 0.96.

Indian Equity Market (contd.)

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7.12

7.14

7.16

7.18

7.20

7.22

29-Apr 30-Apr 2-May 3-May

Yield in %

10 -Yr Benchmark Bond ( % )

Source: CCIL

Debt Indicators

(%)

Current

Value

1-Wk

Ago

1-Mth

Ago

6-Mth

Ago

Call Rate

6.45 6.68 6.44 6.75

91 Day T-Bill

7.03 6.96 6.83 6.95

07.06% 2028, (5 Yr GOI)

7.15 7.19 7.09 7.30

07.18% 2033, (10 Yr GOI)

7.15 7.23 7.10 7.31

Source: Refinitiv Values as on May 03, 2024

• Bond yields fell in tandem with the U.S.

Treasury yields after the U.S. Federal

Reserve maintained interest rates as

expected but sounded less hawkish than

anticipated.

• Yield on the 10-year benchmark paper

(7.18% GS 2033) fell by 4 bps to close at

7.15% from the previous week’s close of

7.19%.

• Data from Reserve Bank of India showed

that India's foreign exchange reserves

decreased to $637.92 billion for the

week ended Apr 26, 2024 compared with

$640.33 billion a week earlier.

Domestic Debt Market

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-10

-5

6.80

7.00

7.20

7.40

3 Mths 6 Mths 1 Yr 5 Yrs 10 Yrs 20 Yrs 30 Yrs

India Yield Curve Shift (%) (W-o-W)

Change in bps 03-May-24 26-Apr-24

Yield in %

Change in bps

Source: Refinitiv

Maturity

G-Sec Yield

(%)

Corporate Yield

(%)

Spread

bps

1 Year 7.18 8.02 84

3 Year 7.29 7.82 53

5 Year 7.29 7.72 43

10 Year 7.28 7.67 39

Source: Refinitiv

Values as on May 03, 2024

• Yields on gilt fell up to 5 bps across the maturities,

barring 1 & 11 year papers that rose by 2 & 4 bps

respectively.

• Corporate bond yields fell between 3 to 7 across

the curve, barring 1 year paper that increased by 1

bps.

• Difference in spread between AAA corporate bond

and gilt remained steady or contracted by 1 bps

across the segments, barring 15 year paper that

contracted by 4 bps.

Domestic Debt Market (Spread Analysis)

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• The RBI directed regulated entities to review their lending policies and bring them into

compliance with the fair practice code after discovering that certain lenders were using

unfair methods for calculating interest rates. The regulator brought to light the fact that

certain lenders assessed interest on loans starting on the day the loan agreement was

executed or sanctioned, as opposed to the date of disbursement. The RBI also mentioned

instances in which loans were paid out by cheque and interest was assessed by lenders

starting on the date of the cheque, even though the customer received the check several

days later.

• The RBI has introduced two new surveys, the 'Inflation Expectations Survey of Households'

and the 'Consumer Confidence Survey,' aimed at providing crucial insights for the upcoming

bi-monthly monetary policy.

• The Spices Board of India has made testing for ethylene oxide (ETO) mandatory for all spices

being exported to Hong Kong and Singapore from May 6, 2024, where authorities last

month stopped sales of some products of two Indian spice brands on the ground that they

contained high levels of ETO.

• According to the commerce ministry, India and Nigeria have identified areas such as crude

oil, natural gas, pharmaceuticals, Unified Payments Interface, local currency settlement

system, and power sector to increase cooperation for boosting economic ties.

Regulatory Updates in India

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• The RBI advised lenders to make larger provisions for infrastructure projects that are still

under construction and requested that they maintain close oversight of any emerging

stress. During the project's construction phase, the RBI has suggested that banks set aside

5% of the loan amount. This can be lowered to 2.5% once a project is up and running, and

to 1% once it begins to bring in enough money to meet the lenders' demands for

repayment.

• SEBI has eliminated the need to appoint fund managers to manage commodity funds, such

as gold and silver ETFs. But the regulator has made it clear that fund houses need to make

sure the fund manager they choose to oversee their commodity funds has the necessary

training and experience.

• SEBI eliminated the requirement of making nomination compulsory in joint mutual fund

folios in order to simplify, ease and reduce cost of compliance, since the surviving

holder in a joint folio takes precedence over nominee during the transmission of units, the

risk of unclaimed units is low.

Regulatory Updates in India (contd..)

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• According to the Labor Department, U.S. non-farm payroll employment climbed by

175,000 jobs in Apr 2024 after surging by an upwardly revised 315,000 jobs in Mar 2024.

Economists had expected employment to jump by 243,000 jobs compared to the spike of

303,000 jobs originally reported for the previous month.

• The U.S. Federal Reserve decided to maintain the target range for the federal funds rate at

5.25 to 5.50% in support of its dual goals of maximum employment and inflation at the

rate of 2% over the longer run. Members of the Fed also reiterated they need "greater

confidence" inflation is moving sustainably toward 2% before they consider cutting

interest rates.

• According to S&P Global, U.K. services purchasing managers' index rose to 55.0 in Apr 2024

from 53.1 in Mar 2024. That was also above the flash score of 54.9. A score above 50

indicates expansion.

• According to a survey, China’s manufacturing sector continued to expand in Apr 2024, and

at a faster pace with a manufacturing PMI score of 51.4. That's up from 51.1, and it moved

further above the boom-or-bust line of 50 that separates expansion from contraction.

• According to the Ministry of Economy, Trade and Industry, Japan’s industrial production

was up a seasonally adjusted 3.8% on month in Mar 2024. That beat forecasts for an

increase of 3.4% following the 0.6% decline in Feb 2024.

Global News/Economy

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Global Indices

Indices

03-May-24

1-Week

Return

YTD

Return

Russell 3000 2,617.22 1.04% 8.92%

Nasdaq 100 17,890.8 0.97% 6.33%

FTSE 100 8,213.49 0.90% 6.21%

DAX Index 18,001.6 -0.88% 7.46%

Nikkei Average

[1]

38,236.07 0.79% 14.26%

Straits Times 3,292.93 0.39% 1.63%

Source: Refinitiv

Value as on May 03, 2024;

[1] Value as of May 02, 2024

U.S.

• U.S. equity markets rose after the U.S.

Fed held interest rates with less

hawkish-than-expected remarks on May

01, 2024. Gains were extended after the

Labor Department revealed that U.S.

non-farm payroll employment climbed

by 175,000 jobs in Apr 2024 compared

to economists’ expectation of 243,000,

which reinforced expectations that later

this year, the U.S. Fed would start

cutting interest rates.

Europe

• European markets mostly fell despite investors responding positively to news about

company earnings and local economic data. The general uptrend in the markets was also

aided by dwindling worries about the trajectory of interest rates.

Asia

• Asian equity markets rose as China stepped up efforts to spur an economic rebound and

expectations of additional stimulus measures caused real estate developers to soar.

Further, the sentiment was supported somewhat after the U.S. Federal Reserve

maintained interest rates with less hawkish-than-expected comments.

Global Equity Markets

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4.40

4.45

4.50

4.55

4.60

4.65

4.70

29-Apr 30-Apr 1-May 2-May 3-May

Yield in %

US 10-Year Treasury Yield Movement

Source: Refinitiv

• Yields on the 10-year U.S. Treasury fell

by 17 bps to close at 4.50% from the

previous week’s close of 4.67%.

• U.S. Treasury prices rose after data

revealed that the largest economy in

the world added fewer jobs than

anticipated in Apr 2024, confirming

predictions that the U.S. Federal

Reserve will begin lowering interest

rates later this year.

• Further, prices increased as investors

are still processing the U.S. Federal

Reserve's less-than-hawkish posture

following its policy meeting on 1st May

2024, which implied that interest rate

reductions were very much on the

agenda despite inflation's persistently

high 2% objective.

Global Debt (U.S.)

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8.50

9.00

9.50

10.00

10.50

11.00

3-Apr-24 19-Apr-24

Global Commodity Movement

Gold Spot ($/Oz) Silver Spot ($/Oz) Brent ($/bbl)

Global Commodity Prices

Rebased to 10

Source: Refinitiv

Performance of various commodities

Commodities

Last Closing* 1-Week Ago

Brent Crude($/Barrel)

84.7 91.05

Gold ($/Oz)

2,301.56 2,337.72

Gold (Rs/10 gm)

70,941 72,301

Silver ($/Oz)

26.54 27.17

Silver (Rs/Kg)

79,911 81,204

Source: Refinitiv *Value as on May 03, 2024

Gold

• Gold prices fell as attention shifted back to

the possibility that U.S. interest rates may

remain higher for longer. Further, prices

fell as the demand for safe-haven bullion

decreased as concerns of an ongoing war in

the Middle East faded.

Brent Crude

• Brent crude oil prices fell following

information revealing an unanticipatedly

large increase in U.S. oil stocks in the week

ending Apr 26, 2024. Further, prices fell

due to easing Middle East tensions and

signs of weak U.S. demand.

Baltic Dry Index

• The index rose over the week due to

improved capesize and panamax activities.

Commodities Market

03-May-24

-6.97%

-1.55%

-2.30%

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9.40

9.60

9.80

10.00

10.20

3-Apr-24 19-Apr-24

USD GBP Euro JPY

Source: Refinitiv

Currency Prices ( in terms of INR)

Rebased to 10

Currency Movement

Movement of Rupee vs Other Currencies

Currency

Last Closing* 1-Wk Ago

US Dollar

83.38 83.34

Pound Sterling

104.62 104.26

EURO

89.50 89.43

100 Yen

54.45 53.43

Source: Refinitiv Figures in INR ,

*Value as on May 03, 2024

Rupee

• The Indian rupee in the spot trade fell against

the U.S. dollar following weakness in other

Asian currencies. However, losses were

restricted following rise in the domestic equity

market.

Euro

• The euro rose against the greenback after data

revealed that U.S. jobs growth slowed more

than expected in Apr 2024 that bets the U.S.

Fed would cut rates twice this year.

Pound

• Pound rose against the U.S. dollar after data

showed that U.S. employment growth slowed

more than anticipated in Apr 2024.

• Yen rose against the U.S. dollar as investors

pointed to the yen-buying intervention by the

Japanese government for the first time in 18

months.

Currencies Markets

03-May-24

0.05%

1.91%

0.08%

0.35%

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The Week that was…

Apr to 03

May

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The Week that was (Apr 29 – May 03)

Date Events

Present

Value

Monday,

April 29, 2024

• Eurozone Economic Sentiment Indicator(Apr) 95.6 96.2

• Geramany Consumer Price Index (YoY)(Apr) PREL 2.20% 2.20%

• Japan Retail Trade (YoY)(Mar) 1.20% 4.70%

Tuesday,

April 30, 2024

• India Infrastructure Output YoY (Mar) 5.20% 7.10%

• China Caixin Manufacturing PMI(Apr) 51.4 51.1

• Germany Retail Sales (YoY)(Mar) 0.30% -2.70%

• Germany Gross Domestic Product (QoQ)(Q1) PREL 0.20% -0.30%

Wednesday,

May 01, 2024

• U.S. ADP Employment Change(Apr) 192K 208K

• U.S. ISM Manufacturing PMI(Apr) 49.2 50.3

• U.S. Fed Interest Rate Decision 5.50% 5.50%

Thursday,

May 02, 2024

• Germany HCOB Manufacturing PMI(Apr) 42.5 42.2

• U.S. Initial Jobless Claims(Apr 26) 208K 208K

• U.S. Nonfarm Productivity(Q1) PREL 0.30% 3.5%

Friday,

May 03, 2024

• Eurozone Unemployment Rate(Mar) 6.50% 6.50%

• U.S. Nonfarm Payrolls(Apr) 175K 315K

• U.S. ISM Services PMI(Apr) 49.4 51.4

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The Week Ahead

May to 10

May

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The Week Ahead

Day Event

Monday,

May 06, 2024

• India HSBC Composite PMI Final (Apr)

• China Caixin Services PMI(Apr)

• Germany HCOB Composite PMI(Apr)

• Eurozone Producer Price Index (YoY)(Mar)

Tuesday,

May 07, 2024

• Germany Factory Orders (YoY)(Mar)

• Germany Imports (MoM)(Mar)

Wednesday,

May 08, 2024

• Germany Industrial Production (MoM)(Mar)

• Eurozone Non-Monetary Policy ECB Meeting

Thursday,

May 09, 2024

• China Exports (YoY)(Apr)

• Bank of England Interest Rate Decision

• Japan Labor Cash Earnings (YoY)(Mar)

• U.S. Initial Jobless Claims (May 3)

Friday,

May 10, 2024

• India Industrial Production (YoY) (MAR)

• India Manufacturing Production (YoY) (Mar)

• U.K. Gross Domestic Product (QoQ)(Q1) PREL

• U.K. Manufacturing Production (MoM)(Mar)

• U.S. Michigan Consumer Sentiment Index(May) PREL

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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

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