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NEWS U CAN USE
January 15, 2021
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The Week that was…
11
th
Jan to 15
th
Jan
2
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Indian Economy
• Government data showed that India’s trade deficit widened to $15.44 billion in Dec 2020
from $12.49 billion in the same period of the previous year. Trade deficit widened as
imports grew 7.56% over the year while exports grew 0.14%.
• Government data showed that the consumer price index-based inflation fell to 4.59% in
Dec 2020 from 6.93% in the previous month. The Consumer Food Price Index fell to 3.41%
in Dec 2020 from 9.50% in the previous month.
• Government data showed that the index of industrial production (IIP) contracted 1.9% in
Nov 2020 as compared to a growth of 2.1% in the same period of the previous year. For
the period from Apr to Nov of 2020, IIP contracted 15.5% as compared to a growth of
0.3% in the same period of the previous year.
• Government data showed that the wholesale price index (WPI) based inflation eased to
1.22% in Dec 2020 from 1.55% in the previous month and 2.76% in the same month of the
previous year. The growth of WPI Food Index also slowed to 0.92% in Dec 2020 from
4.27% in the previous month and 6.18% in Oct 2020.
• Data from the Society of Indian Automobile Manufacturers (SIAM) showed that the total
production of passenger vehicles, three wheelers, two wheelers and Quadricycle
witnessed a growth of 9.0% from 1,750,347 units in Dec 2019 to 1,907,811 units in Dec
2020. Passenger Vehicle sales grew 13.59% over the year from 222,728 units in Dec 2019
to 252,998 units in Dec 2020.
3
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4
Domestic Equity Market Indices
Indices 15-Jan-21 1 Week Return YTD Return
S&P BSE Sensex
49,034.67 0.52% 2.69%
Nifty 50
14,433.70 0.60% 3.23%
S&P BSE Mid-Cap
18,904.14 -1.23% 5.37%
S&P BSE Small-Cap
18,682.12 -1.20% 3.23%
Source: MFI Explorer
NSE Advance/Decline Ratio
Date Advances Declines
Advance/Decline Ratio
11-Jan-21 778 1,210 0.64
12-Jan-21 1,037 917 1.13
13-Jan-21 667 1,309 0.51
14-Jan-21 912 1,022 0.89
15-Jan-21 518 1,432 0.36
Source: NSE
• Indian equity markets witnessed
modest gains for the week with Sensex
surpassing the 49,500 mark. Investors
took positive cues from a healthy set of
earning numbers reported by one of IT
majors for Q3FY21.
• Market sentiments buoyed after a
couple of other IT majors also posted
upbeat earning numbers. Meanwhile,
positive impact of easing retail inflation
number for Dec 2020 was neutralized
by contraction in factory output data
for Nov 2020.
• However, markets gave up most of the
gains on the last day of the week due
to profit booking. Rising COVID-19
cases in China reinforced concerns over
the prospects for a global economic
recovery which also dampened
sentiments.
Ratios
S&P BSE
Sensex
Nifty 50
S&P BSE
Mid Cap
S&P BSE
Small Cap
P/E
34.12 39.34 69.69 221.36
P/B
3.35 4.09 2.84 2.54
Dividend Yield
0.81 1.10 0.96 0.90
Source: BSE, NSE Va
lue as on Jan 15, 2021
Indian Equity Market
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5
Sectoral Indices
Indices
Last
Closing*
Returns (in %)
1-Wk 1-Mth
S&P BSE Auto
22,961.6 4.38% 10.91%
S&P BSE Bankex
36,540.5 -0.32% 3.93%
S&P BSE CD
30,160.0 -3.30% 5.34%
S&P BSE CG
19,630.4 -1.45% 7.78%
S&P BSE FMCG
12,753.0 1.25% 1.58%
S&P BSE HC
22,034.9 -1.13% 4.24%
S&P BSE IT
26,353.0 2.00% 16.48%
S&P BSE Metal
12,345.8 -2.47% 8.75%
S&P BSE Oil & Gas
14,955.8 1.52% 2.65%
Source:
Refinitiv *Value as on Jan 15, 2021
• On the BSE sectoral front, the indices
witnessed a mixed trend. S&P BSE Auto was
the major gainer, up 4.38%, followed by S&P
BSE Teck and S&P BSE IT, which rose 2.83%
and 2.00%, respectively.
• Meanwhile, S&P BSE Consumer Durables was
the top loser, down 3.30%, followed by S&P
BSE Metal and S&P BSE Capital Goods, which
slipped 2.47% and 1.45%, respectively.
Indian Derivatives Market Review
• Nifty Jan 2021 Futures stood at 14,458.50, a premium of 24.80 points above the spot
closing of 14,433.70. The total turnover on NSE’s Futures and Options segment for the
week stood at Rs. 175.71 lakh crore as against Rs. 169.38 lakh crore for the week to Jan 8.
• The Put-Call ratio stood at 1.04 compared with the previous week’s close of 0.87.
• The Nifty Put-Call ratio stood at 1.19 compared with the previous week’s close of 1.71.
Indian Equity Market (contd.)
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6
Debt Indicators
(%)
Current
Value
1-Wk
Ago
1-Mth
Ago
6-Mth
Ago
Call Rate
3.22 3.18 3.21 3.51
91 Day T-Bill
3.29 3.06 3.11 3.23
05.22% 2025, (5 Yr GOI)
5.24 5.01 5.04 4.87
05.77% 2030, (10 Yr GOI)
5.99 5.89 5.94 5.82
Source: Refinitiv Value as on Jan 15, 2021
• Bond yields rose after the Reserve
Bank of India (RBI) announced to
restore normal liquidity management
operations. However, further losses
were restricted after the RBI bought
securities through open market
operations (OMO).
• Yield on the 10-year benchmark paper
(5.77% GS 2030) rose 10 bps to close
at 5.99% compared to the previous
week’s close of 5.89%.
• According to the RBI’s data released in
the weekly statistical supplement,
India’s foreign exchange reserves rose
$0.758 billion to $586.082 billion in
the week ended Jan 8, 2021 from
$585.324 billion in the previous week.
Domestic Debt Market
5.90
5.95
6.00
11-Jan 12-Jan 13-Jan 14-Jan 15-Jan
Yield in %
10 -Yr Benchmark Bond ( % )
Source: CCIL
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7
Maturity
G-Sec Yield
(%)
Corporate Yield
(%)
Spread
bps
1 Year 3.94 4.74 80
3 Year 4.71 5.57 86
5 Year 5.40 6.55 115
10 Year 6.08 7.21 113
Source: Refinitiv Value as on
Jan 15, 2021
• Yields on gilt securities increased across the
maturities in the range of 3 bps to 28 bps.
• Corporate bond yields increased across the
maturities in the range of 11 bps to 27 bps. The
maximum increase was witnessed on 1-year
paper and the minimum increase was witnessed
on 15-year paper.
• Spread between AAA corporate bond and gilt
contracted across 2 to 5-year maturities and 15-
year paper in the range of 2 bps to 15 bps and
expanded across the remaining maturities by 2
bps or 3 bps.
Domestic Debt Market (Spread Analysis)
0
13
26
2.70
4.90
7.10
3 Mths 6 Mths 1 Yr 5 Yrs 10 Yrs 20 Yrs 30 Yrs
India Yield Curve Shift (%) (W-o-W)
Change in bps 15-Jan-21 08-Jan-21
Yield in %
Change in bps
Source: Refinitiv
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8
• According to media reports, capital market regulator Securities and Exchange Board of India
(SEBI) in a draft circular, proposed re-verification of existing KYC records of investors to
ensure correctness of all KYC records. Accordingly, KYC Registration Agencies (KRAs) will re-
verify KYC documents of all your clients till Dec 2021.
• According to media reports, SEBI has cut down application and registration fees for
individuals and corporates seeking a registered investment advisor status. Accordingly,
individuals and firms (partnership) will have to pay Rs 2,000 while applying for an investment
advisor certificate. Earlier, they had to pay a higher amount of Rs 5,000 as application fee.
The application fee for corporates including Limited Liability Partnerships (LLPs) has been
brought down to Rs 10,000 from Rs 25,000.
• According to media reports, SEBI mandated that registered investment advisors cannot
charge clients for execution services such as mutual fund transactions or stock broking.
• According to media reports, the government is considering expanding the investment scope
of the Employees’ State Insurance Corporation (ESIC) by allowing it to invest up to 15% of its
corpus in equities and mutual funds. The objective of the move is to better utilize the ESIC
corpus and earn a higher return on investments.
Regulatory Updates in India
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9
• The Reserve Bank of India has prepared a working group on digital lending including
lending through online platforms and mobile apps. The group will propose measures to
monitor digital lending, including a framework for online lending and mobile lending. RBI
said that the recent spurt and popularity of mobile lending apps/online lending platforms
have raised some serious questions with broader structural implications.
• According to media reports, Insurance Regulatory and Development Authority (IRDAI) has
proposed to extend the validity of regulatory sandbox guidelines by 2 years as the
proposal received under it require more time to complete. The validity of the Regulatory
Sandbox Regulations expires on Jul 25, 2021. A regulatory sandbox is a framework set up
by a regulator that allows fin-tech start-ups and other innovators to conduct live
experiments in a controlled environment under a regulator's supervision.
• According to media reports, IRDAI has directed insurers to settle cashless COVID-19 claims
as per the tariff decided by insurers, hospitals and third-party administrators (TPA).
According to insurance regulator, insurers shall make efforts to have an agreement with
health providers on rates for treatment of COVID-19 similar to other diseases for which
rate agreements are in place.
• The Ministry of Finance released the 11th weekly instalment of Rs.6,000 crore to the
States for meeting the shortfall of the Goods and Services Tax (GST) compensation. A total
amount of Rs. 66,000 crore has been released so far to all States and Union Territories
with legislation.
Regulatory Updates in India (contd..)
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• According to the preliminary data released by the University of Michigan, U.S. consumer
sentiment index fell to 79.2 in Jan 2021 after increasing to 80.7 in Dec 2020. The report
also mentioned that the current economic conditions index fell to 87.7 in Jan 2021 from
90.0 in Dec 2020, while the index of consumer expectations slipped to 73.8 in Jan 2021
from 74.6 in Dec 2020.
• According to the Commerce Department, U.S. retail sales fell 0.7% in Dec 2020 after falling
by 1.4% in Nov 2020.
• According to Destatis, Germany’s gross domestic product fell 5% in 2020 as compared to
0.6% rise in 2019.
• According to the minutes of European Central Bank’s latest policy session, the
policymakers expects the eurozone economy to rebound to pre-crisis levels by mid-2022.
They were also worried that the economic crisis could be exacerbated by the revival of the
coronavirus pandemic that has led to the restoration of lockdowns in many countries.
• According to data published by the National Bureau of Statistics, China’s consumer prices
inflation (CPI) rose 0.2% YoY in Dec 2020 as against 0.5% fall in Nov 2020. Food prices rose
1.2% in Dec 2020 as against 2% decrease in Nov 2020.
• According to the Labor Department, U.S. consumer price index rose 0.4% in Dec 2020 after
rising 0.2% in Nov 2020. Food prices also rose 0.4% in Dec 2020. Excluding food and energy
prices, the core consumer price index rose 0.1% in Dec 2020 after rising 0.2% in Nov 2020.
10
Global News/Economy
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11
Global Indices
Indices
15-Jan-21
1-Week
Return
YTD
Return
Russell 3000
1,940.22 -2.12% -0.63%
Nasdaq 100
12,803.93 -2.30% -0.65%
FTSE 100
6,735.71 -2.00% 4.26%
DAX Index
13787.73 -1.86% 0.50%
Nikkei Average
28,519.18 1.35% 3.92%
Straits Times
3,004.87 0.39% 5.66%
Source: Refinitiv
Value as on Jan 15, 2021
U.S.
• U.S. markets went down following
reports that House Democrats are
preparing to impeach the U.S. President
even though he has less than two weeks
left in his term. Buying interest was also
affected by report from the Labor
Department which showed that initial
U.S. jobless claims jumped to their
highest level in over four months in the
week ended Jan 9.
Europe
• European markets fell amid worries about rising COVID-19 cases and tighter lockdown
restrictions in the U.K., Germany, and several other places across the continent.
Nonetheless, the downturn was restricted by optimism over U.S. President-elect
announcing a $1.9 trillion stimulus package to boost the world's largest economy.
Asia
• Asian markets went up with investors reacting to higher-than-expected rise in Chinese
exports in Dec 2020. Market participants also tracked developments on the coronavirus
vaccine front.
Global Equity Markets
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12
• Yields on the 10-year U.S. Treasury fell 1
bps to close at 1.10% compared with
the previous week’s close of 1.11%.
• U.S. Treasury prices fell initially as
market participants adjusted for higher
government spending under the new
U.S. administration.
• Prices fell further after dovish
comments from the U.S. Federal
Reserve Chairman boosted expectations
for a rise in inflation.
• However, losses reversed after $120
billion auction this week saw strong
demand for long-dated bonds.
Global Debt (U.S.)
1.08
1.12
1.16
11-Jan 12-Jan 13-Jan 14-Jan 15-Jan
Yield in %
US 10-Year Treasury Yield Movement
Source: Refinitiv
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13
Performance of various commodities
Commodities
Last Closing* 1-Week Ago
Brent Crude($/Barrel)
54.52 55.26
Gold ($/Oz)
1,826.59 1,848.26
Gold (Rs/10 gm)
49,285 50,256
Silver ($/Oz)
24.74 25.37
Silver (Rs/Kg)
65,174 67,467
Source: Refinitiv *Value as on Jan 15, 2021
Gold
• Gold prices fell on the back of a stronger
U.S. dollar and higher U.S. Treasury
yields. However, growing possibility of
additional stimulus measures from the
U.S. government restricted further
losses.
Brent Crude
• Brent crude prices fell on persisting
concerns over COVID-19 pandemic due
to surging coronavirus infection cases in
Europe and new lockdowns in China.
However, expectations of additional
stimulus measures from the U.S.
government restricted further losses.
Baltic Dry Index
• The index rose due to improved capesize
and panamax activities.
Commodities Market
9.65
10.00
10.35
10.70
11.05
16-Dec-20 31-Dec-20 15-Jan-21
Global Commodity Movement
Gold Spot ($/Oz) Silver Spot ($/Oz) Brent ($/bbl)
Global Commodity Prices
Rebased to 10
Source: Refinitiv
-2.50%
-1.34%
-1.17%
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14
Movement of Rupee vs Other Currencies
Currency Last Closing* 1-Wk Ago
US Dollar
73.02 73.33
Pound Sterling
99.83 99.52
EURO
88.64 89.94
100 Yen
70.37 70.60
Source: Refinitiv Figures in INR , *Value as on Jan 15, 2021
Rupee
• The Indian rupee rose against the U.S.
dollar following continuous equity and
corporate fund-related dollar inflows.
Euro
• Euro fell against the U.S. dollar following
increasing coronavirus infections that
dampened the risk appetite.
Pound
• Pound rose against the U.S. dollar as
comments from the Bank of England's
governor on the viability of negative
interest rates diminished some
expectations of sub-zero rates in Britain.
Yen
• After a range bound movement, yen rose
marginally against the U.S. dollar
following increasing coronavirus
infections that dampened the risk
sentiment.
Currencies Markets
9.85
9.90
9.95
10.00
10.05
10.10
10.15
16-Dec-20 31-Dec-20 15-Jan-21
USD GBP Euro JPY
Currency Prices ( in terms of INR)
Rebased to 10
Currency Movement
Source: Refinitiv
-0.42%
-1.45%
-0.33%
0.30%
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
15
The Week that was…
11
th
Jan to 15
th
Jan
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16
The Week that was (Jan 11 – Jan 15)
Date Events Present Value Previous Value
Monday,
January 11, 2021
• China Consumer Price Index (YoY)(Dec) 0.20% -0.50%
• China Producer Price Index (YoY)(Dec) -0.40% -1.50%
• Euro Zone Sentix Investor Confidence (Jan) 1.3 -2.7
Tuesday,
January 12, 2021
• India Index of Industrial Production (YoY) (Nov) -1.90% 4.20%
• India Wholesale Price Index (YoY) (Nov) 1.22% 1.55%
• U.K. BRC Like-For-Like Retail Sales (YoY) (Dec) 4.80% 7.70%
• Japan Eco Watchers Survey: Outlook (Dec) 37.1 36.5
• China M2 Money Supply (YoY) (Dec) 10.10% 10.70%
• Japan Money Supply M2+CD (YoY)(Dec) 9.20% 9.10%
Wednesday,
January 13, 2021
• U.S. Consumer Price Index (YoY) (Dec) 1.40% 1.20%
• Japan Machine Tool Orders (YoY) (Dec) PREL 8.70% 8.60%
• Germany Wholesale Price Index (YoY) (Dec) -1.20% -1.70%
• Eurozone Industrial Production (MoM) (Nov) 2.50% 2.30%
• U.S. Monthly Budget Statement (Dec) (USD) -144B -145B
• Japan Machinery Orders (YoY) (Nov) -11.30% 2.80%
• Japan Producer Price Index (YoY) (Dec) -2% -2.30%
Thursday,
January 14, 2021
• China Trade Balance (USD) (Dec) 78.17B 75.42B
• U.K. RICS Housing Price Balance (Dec) 65% 66%
Friday,
January 15, 2021
• U.S. Retail Sales (MoM) (Dec) -0.70% -1.40%
• U.S. Michigan Consumer Sentiment Index (Jan) PREL
79.2 80.7
• U.K. Industrial Production (MoM) (Nov) -0.10% 1.10%
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
17
The Week Ahead
18
th
Jan, 2021 to 22
nd
Jan, 2021
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18
Day Event
Monday,
January 18, 2021
• China Gross Domestic Product (YoY) (Q4)
• China Retail Sales (YoY) (Dec)
• China Industrial Production (YoY) (Dec)
Tuesday,
January 19, 2021
• Germany Harmonized Index of Consumer Prices (YoY) (Dec)
• Eurozone ZEW Survey – Economic Sentiment (Jan)
Wednesday,
January 20, 2021
• Peoples Bank of China Interest Rate Decision
• U.K. Consumer Price Index (YoY) (Dec)
• U.K. Retail Price Index (MoM) (Dec)
• Eurozone Consumer Price Index (MoM) (Dec)
Thursday,
January 21, 2021
• Bank of Japan Interest Rate Decision
• European Central Bank Interest Rate Decision
• U.S. Housing Starts (MoM) (Dec)
• U.S. Building Permits (MoM) (Dec)
Friday,
January 22, 2021
• U.K. GfK Consumer Confidence (Jan)
• U.K. Retail Sales (YoY) (Dec)
• Eurozone Markit PMI Composite (Jan) PREL
• U.S. Markit PMI Composite (Jan) PREL
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) (formerly Reliance Nippon Life Asset Management Limited) 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
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