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NEWS U CAN USE
April 23, 2021
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
The Week that was…
19
th
Apr to 23
rd
Apr
2
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
Indian Economy
• According to minutes of Reserve Bank of India’s (RBI) latest monetary policy meeting, rapidly
growing coronavirus cases are the single biggest threat to the Indian economy's continued
recovery. The urgent need is to effectively protect the current economic recovery so that it
becomes broad-based and long-lasting. The resurgence of coronavirus infections in several
parts of the world, as well as the resulting localised and regional lockdowns, has thrown the
growth outlook into doubt. In the face of global financial markets being volatile due to
inflation fears in emerging economies and increasing commodity prices, the RBI governor
has raised concerns about the domestic outlook.
• Government data showed that around 11.58 lakh new members joined the Employees' State
Insurance Corporation (ESIC) in Feb 2021 as against 11.78 lakh in the previous month. Gross
enrolments of new subscribers with ESIC stood at 1.51 crore in FY20 compared to 1.49 crore
in FY19. Net new enrolments with retirement fund body Employees' Provident Fund
Organization (EPFO) stood at 12.37 lakh in Feb 2021, up from 11.95 lakh in Jan 2021.
• Government data showed that India’s foreign exchange reserves rose by $1.193 billion to
$582.406 billion in the week ended Apr 16, 2021. It needs to be noted that India’s foreign
exchange reserves rose to a lifetime high of $590.185 billion in the week ended Jan 29,
2021.
3
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4
Domestic Equity Market Indices
Indices
23-Apr-21
1 Week Return
YTD Return
S&P BSE Sensex
47,878.45 -1.95% 0.27%
Nifty 50
14,341.35 -1.89% 2.57%
S&P BSE Mid
-Cap 19,953.19 -1.01% 11.21%
S&P BSE Small
-Cap 21,005.01 -0.06% 16.06%
Source: MFI Explorer
NSE Advance/Decline Ratio
Date Advances Declines
Advance/Decline Ratio
19-Apr-21 380 1,598 0.24
20-Apr-21 1,073 828 1.30
22-Apr-21 1,136 782 1.45
23-Apr-21 1,028 864 1.19
Source: NSE
• Indian equity markets went down,
resulting from across the board selling
triggered by strong second wave of
COVID-19 in the country.
• The second wave has cast a cloud over
economic growth and earnings outlook
going ahead.
• The steady rise in COVID-19 test
positivity cases and the constant decline
in recovery rates are areas of serious
concern.
• Incidents of localised lockdowns also
weighed on investor sentiments.
• Nonetheless, the downturn was largely
restricted amid expectations that the
mass vaccination drive may help curtail
the raging second COVID-19 wave in the
country.
Ratios
S&P BSE
Sensex
Nifty 50
S&P BSE
Mid Cap
S&P BSE
Small Cap
P/E
32.94 32.07 56.55 75.44
P/B
3.21 4.11 2.98 2.86
Dividend Yield
0.82 1.00 0.92 0.84
Source: NSE,BSE Value
as on April 23, 2021
Indian Equity Market
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5
Sectoral Indices
Indices
Last
Closing*
Returns (in %)
1-Wk 1-Mth
S&P BSE Auto
21,610.74 -2.34% -6.11%
S&P BSE Bankex
36,023.82 -0.73% -6.34%
S&P BSE CD
31,394.58 -3.19% -2.86%
S&P BSE CG
19,962.79 -2.28% -6.30%
S&P BSE FMCG
12,516.84 -3.11% -1.57%
S&P BSE HC
23,320.92 1.36% 11.57%
S&P BSE IT
26,260.80 -2.12% -0.85%
S&P BSE Metal
16,155.95 0.30% 16.60%
S&P BSE Oil & Gas
14,514.03 -1.60% -4.50%
Source: BSE Value as on April 23,
2021
• On the BSE sectoral front, barring S&P BSE
Healthcare and S&P BSE Metal, all the indices
closed in the red. S&P BSE Realty was the
major loser, down 3.45%, followed by S&P BSE
Consumer Durables and S&P BSE FMCG, which
slipped 3.19% and 3.11%, respectively.
• Concerns of the second wave of COVID-19
triggered selling pressure across all the
sectors.
Indian Derivatives Market Review
• Nifty Apr 2021 Futures stood at 14,338.60, a discount of 2.75 points below the spot closing
of 14,341.35. The total turnover on NSE’s Futures and Options segment for the week stood
at Rs. 185.45 lakh crore as against Rs. 192.51 lakh crore for the week to Apr 16.
• The Put-Call ratio stood at 0.82 compared with the previous week’s close of 0.88.
• The Nifty Put-Call ratio stood at 1.27 compared with the previous week’s close of 1.38.
Indian Equity Market (contd.)
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6
Debt Indicators
(%)
Current
Value
1-
Wk
Ago
1-
Mth
Ago
6-
Mth
Ago
Call Rate
3.21 3.25 3.26 3.22
91 Day T
-Bill
3.33 3.34 3.33 3.21
05.22% 2025, (5 Yr GOI)
5.38 5.55 5.58 5.21
05.85% 2030, (10
Yr GOI)
6.04 6.09 6.15 5.84
Source:
Refinitiv Value as on Apr 23, 2021
• Bond yields fell after the Indian
government indicated that it is not in
favour of a nationwide lockdown. The
remark came amid a relentless rise in
COVID-19 cases across the country.
• Yields dropped further as market
participants expect the India’s worsening
Covid-19 crisis to keep monetary policy
easy for longer.
• Yield on the 10-year benchmark paper
(5.85% GS 2030) fell 4 bps to close at
6.05% from the previous week’s close of
6.09% after moving in a range of 6.04% to
6.11%.
• RBI conducted the auction of state
development loans of four State
Governments (tenor 10 & 30 years) for a
notified amount of Rs. 3250 crore, which
was completely accepted. The cut off yield
stood in the range of 6.82% to 6.85%.
Domestic Debt Market
6.00
6.05
6.10
19-Apr 20-Apr 22-Apr 23-Apr
Yield in %
10 -Yr Benchmark Bond ( % )
Source: CCIL
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7
Maturity
G-
Sec Yield
(%)
Corporate Yield
(%)
Spread
bps
1 Year 3.91 4.56 65
3 Year 4.87 5.46 59
5 Year 5.53 6.45 92
10 Year 6.13 7.18 105
Source:
Refinitiv
Value as on
Apr 23, 2021
• Yields on gilt securities fell in the range of 2
to 19 bps across maturities, leaving 11- & 30-
year papers that rose 3 & 2 bps respectively.
Yield fell the most on 2-year paper.
• Corporate bond yields dropped in the range
of 5 to 35 bps across the curve. Yield fell the
most on 15-year paper.
• Spread between AAA corporate bond and gilt
contracted by up to 32 bps across segments,
leaving 2-year paper that expanded 13 bps.
Spread fell the most on 15-year paper.
Domestic Debt Market (Spread Analysis)
-22
-11
0
2.90
5.30
7.70
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-Apr-21 16-Apr-21
Yield
in %
Change
in bps
Source: Thomson Reuters Eikon
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8
• The Reserve Bank of Inia (RBI) expressed concerns over the ongoing second wave of COVID-
19 pandemic in the country. The Central Bank underlined the importance of banks
remaining resilient so that they are able to proactively raise and conserve capital as a
protection against unexpected losses. RBI further mandated that commercial banks may pay
dividend on equity shares from the profits for the financial year ended Mar 31, 2021 subject
to the quantum of dividend being not more than 50% of the amount determined as per the
dividend payout ratio.
• RBI following the review and empirical testing of countercyclical capital buffer (CCyB)
indicators decided that it is not necessary to activate CCyB at this point in time.
• RBI constituted a Committee on functioning of Asset Reconstruction Companies (ARCs) and
review of regulatory guidelines applicable to them. The Committee will submit its report
within three months from the date of its first meeting.
• The Government of India announced liberalised & accelerated Phase 3 strategy of COVID-19
vaccination from May 1, 2021. Vaccination is available to those over the age of 18. For all
vaccines produced in India, a 50% supply to the government and a 50% supply to another
channel will be applied uniformly.
Regulatory Updates in India
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9
• The Union Cabinet gave ex-post facto approval to the official amendments to the Finance
Bill, 2021, which were aimed at clarifying and rationalising tax proposals for 2021-22. The
changes were necessary to better explain and rationalise the proposals, as well as to
resolve stakeholders' concerns about the proposals in the Finance Bill. The Finance Bill
became the Finance Act, 2021 on Mar 28, 2021 after receiving the President's nod.
• According to SEBI, investment advisors may provide execution services to their advisory
clients without charging any commissions or fees. It also stated that an investment advisor
cannot receive any compensation from AMCs whose direct plans are offered to clients for
the services provided to them.
• According to media reports, IRDAI has issued Insurance Regulatory and Development
Authority of India (Insurance Advertisements and Disclosure) Regulations, 2021. The
underlying objective is to ensure that insurers and intermediaries adopt fair, honest and
transparent practices while issuing advertisements and avoid practices that tend to impair
the confidence of the public. Insurers and their intermediaries will have to ensure that
advertisements are relevant, fair and in simple language which can enable people to take
informed decisions.
• According to media reports, finance minister has asked IRDAI to ensure that hospitals
accept cashless insurance policies for the treatment of COVID patients. The instruction
from the finance minister came after reports suggested that hospitals are not accepting
cashless insurance policies for treatment of COVID patients.
Regulatory Updates in India (contd..)
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
• Data from the U.S. Commerce Department showed that new home sales in U.S. rose 20.7%
to an annual rate of 1.021 million in Mar 2021 after coming down by 16.2% to a revised
rate of 846,000 in Feb 2021 (775,000 originally reported for the previous month).
• The European Central Bank maintained its interest rates and asset purchases, despite the
resurgence of coronavirus infections and ongoing lockdowns dampening the outlook for
an economic recovery later this year. The key refi rate remained at a record low of 0%,
while the deposit rate remained at -0.50%. At 0.25%, the lending rate remained
unchanged. ECB kept the scale of the pandemic emergency purchasing programme (PEPP)
at EUR 1,850 billion.
• People’s Bank of China as expected kept its benchmark lending rates unchanged. The one-
year loan prime rate was retained at 3.85% and the five-year loan prime rate was
maintained at 4.65%. The policy makers acknowledged that with the economy doing well
they are now focusing on addressing financial risks. Even in the absence of rate hikes,
tighter credit conditions would become a growing headwind to economic activity over the
coming quarters.
• Flash estimate from Jibun Bank showed that the manufacturing sector in Japan expanded
in Apr 2021 as its manufacturing PMI rose to 59.6 in Apr 2021 from 53.3 in Mar 2021. The
services PMI improved to 48.3 in Apr 2021 from 46.5 in Mar 2021 while the composite
index climbed to 50.2 in Apr 2021 from 49.9 in Mar 2021.
10
Global News/Economy
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11
Global Indices
Indices
23-Apr-21
1-Week
Return
YTD
Return
Russell 3000
2,111.01 -0.12% 8.11%
Nasdaq 100
13,941.44 -0.72% 8.17%
FTSE 100
6,938.56 -1.15% 7.40%
DAX Index
15,279.62 -1.17% 11.38%
Nikkei Average
29,020.63 -2.23% 5.74%
Straits Times
3,194.04 -0.24% 12.32%
Source: Refinitiv Value as on Apr 23, 2021;
U.S.
• U.S. markets slipped in the red as
worries about the spikes in coronavirus
cases in several countries raised
uncertainty about the pace of global
economic recovery.
• Bourses witnessed additional pressure
following reports that U.S. President is
planning to propose nearly doubling the
capital gains tax rate for wealthy
individuals to fund spending on child-
care and education.
Europe
• European markets went down with investors tracking updates on coronavirus infections
and vaccine rollouts. Losses were restricted by European Central Bank's monetary policy
announcement, and some encouraging earnings reports.
Asia
• Asian markets witnessed a mixed trend as positive vibes generated from upbeat economic
data from U.S., released last week, was neutralised by concerns over recent surge in
COVID-19 cases worldwide.
Global Equity Markets
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12
• Yields on the 10-year U.S. Treasury
remained unchanged at 1.57% from the
previous week’s close.
• U.S. Treasury prices fell as market
participants remained cautious ahead of
the bond auction on Wednesday.
• However, losses were restricted as
market participants moved out of equity
market and observed challenges many
countries still face from the COVID-19
pandemic.
• Losses reversed on news that the U.S.
President will propose a tax hike for
high earners.
Global Debt (U.S.)
1.53
1.57
1.61
19-Apr 20-Apr 21-Apr 22-Apr 23-Apr
US 10-Year Treasury Yield Movement
Source: Thomson Reuters Eikon
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13
Performance of various commodities
Commodities
Last Closing*
1-Week Ago
Brent Crude($/Barrel)
66.11 65.78
Gold ($/Oz)
1777.18 1776.31
Gold (Rs/10 gm)
47569 47021
Silver ($/Oz)
25.99 25.96
Silver (Rs/Kg)
69875 68970
Source: Refinitiv *
Value as on Apr 23, 2021
Gold
• Gold prices rose as surging coronavirus
infection cases revived fears about the
global economy which boosted the safe
haven appeal of the bullion. Additionally,
expectations that central banks are not
going to alter their ultra-loose monetary
policy anytime soon also supported gains.
Brent Crude
• Brent Crude prices fell initially as increase in
the number of COVID-19 cases globally and
a surprise build in U.S. crude oil supplies
renewed fuel demand worries. Oil prices
managed to recoup losses later on hopes of
demand recovery as data from U.S. and
China indicated economic recovery.
Baltic Dry Index
• The index rose during the week due to
improved capesize and panamax activities.
Commodities Market
9.40
9.70
10.00
10.30
10.60
10.90
23-Mar-21 8-Apr-21
Global Commodity Movement
Gold Spot ($/Oz) Silver Spot ($/Oz) Brent ($/bbl)
Global
Commodity Prices
Rebased to 10
Source: Thomson Reuters Eikon
0.13%
0.50%
0.05%
23-Apr-21
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14
Movement of Rupee vs Other Currencies
Currency
Last Closing 1-Wk Ago
US Dollar
74.91 74.56
Pound Sterling
103.81 102.44
EURO
90.09 89.19
100 Yen
69.40 68.49
Source: Refinitiv Figures in INR , *
Value as on
Apr 23, 2021
Rupee
• The Indian rupee fell against the U.S. dollar, as a
continuous rise in coronavirus infections in India
raised worries of stricter restrictions and a delay
in economic recovery.
Euro
• Euro rose against the U.S. dollar on
improvement in risk sentiment, upbeat survey
of purchasing managers index and after ECB
President put down speculation that
policymakers will start to consider a tapering of
bond purchases.
Pound
• Sterling rose against the U.S. dollar following
decline in the U.S. treasury yields and strong
U.K. retail sales data and business surveys.
Yen
• Yen gained against U.S. dollar following decline
in the U.S. treasury yields.
Currencies Markets
9.80
10.00
10.20
10.40
10.60
23-Mar-21 8-Apr-21
USD GBP Euro JPY
Source: Thomson Reuters Eikon
Currency
Prices (
in terms of INR)
Rebased to 10
Currency Movement
1.01%
1.33%
0.47%
1.33%
23-Apr-21
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15
The Week that was…
19
th
Apr to 23
rd
Apr
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16
The Week that was (Apr 19 – Apr 23)
Date Events
Present Value
Previous Value
Monday,
April 19, 2021
• Japan Balance of Trade (Mar)
¥663.7B ¥215.9B
• Japan Exports YoY (Mar)
16.10% -4.50%
• Japan Imports YoY (Mar)
5.70% 11.80%
• Japan Capacity Utilization MoM (Feb)
-2.80% 3.20%
• Japan Industrial Production YoY Final (Feb)
-2.00% -5.30%
Tuesday,
April 20, 2021
• Germany PPI YoY (Mar)
3.7% 1.9%
• U.K. Unemployment Rate (Feb)
4.9% 5.0%
• U.K. Employment Change (Jan)
-73K -147K
Wednesday,
April 21, 2021
• U.K. Core Inflation Rate YoY (Mar)
1.1% 0.9%
• U.K. Inflation Rate YoY (Mar)
0.7% 0.4%
• U.S. MBA 30
-Year Mortgage Rate (Apr 16) 3.20% 3.27%
Thursday
April 22, 2021
• U.K. CBI Industrial Trends Orders (Apr)
-8.00 -5.00
• U.S. Initial Jobless Claims (Apr 17)
547K 586K
• U.S. Existing Home Sales MoM (Mar)
-3.70% -6.30%
Friday,
April 23, 2021
• U.K. Markit/CIPS Manufacturing PMI Flash (Apr)
60.70 58.90
• U.S. Markit Manufacturing PMI Flash (Apr)
60.60 59.10
• Germany Markit Manufacturing PMI Flash (Apr)
66.40 66.60
• Japan Jibun Bank Manufacturing PMI Flash (Apr)
53.30 52.70
• U.K. Gfk Consumer Confidence (Apr)
-15.00 -16.00
• U.K. Retail Sales YoY (MAR)
7.2% -3.6%
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
17
The Week Ahead
19
th
Apr to 23
rd
Apr
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
18
Day Event
Monday,
Apr 26, 2021
•
Japan Leading Economic Index Final (Feb)
•
Germany Ifo Business Climate (Apr)
•
U.S. Durable Goods Orders MoM (Mar)
Tuesday,
Apr 27, 2021
•
China Industrial Profits (YTD) YoY (Mar)
•
Bank of Japan Monetary Policy Review
•
U.S. CB Consumer Confidence (Apr)
Wednesday,
Apr 28, 2021
•
Japan Retail Sales YoY (Mar)
•
Germany GfK Consumer Confidence (May)
•
U.S. Federal Reserve Monetary Policy Review
Thursday,
Apr 29, 2021
•
Germany Unemployment Rate (Apr)
•
Germany Inflation Rate YoY Prel (Apr)
•
U.S. GDP Growth Rate QoQ Adv (Q1)
Friday,
Apr 30, 2021
•
Japan Unemployment Rate (Mar)
•
Japan Industrial Production YoY Prel (Mar)
•
Germany GDP Growth Rate YoY Flash (Q1)
•
India Infrastructure Output YoY (Mar)
•
U.S. PCE Price Index YoY (Mar)
•
U.S. Michigan Consumer Sentiment Final (Apr)
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
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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