Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
NEWS U CAN USE
June 25, 2021
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
The Week that was…
21
st
June to 25
th
June
2
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
Indian Economy
• According to the Ministry of Commerce & Industry, India attracted US$ 6.24 billion total
Foreign Direct Investment (FDI) inflow during Apr 2021. Total FDI inflows were 38% higher
as compared to the same period of the previous year. FDI Equity inflows increased by 60%
over the year amounting to US$ 4.44 billion. During April 2021, Mauritius was the top
investing country with 24% of the FDI Equity inflows, followed by Singapore (21%) and
Japan (11%).
• According to a United Nations report, India received USD 64 billion in Foreign Direct
Investment in 2020, making it the world's fifth largest recipient of inflows. The COVID-19
second wave in the country is weighing heavily on the country's overall economic activities,
but its strong fundamentals provide optimism for the medium term.
• A major global credit rating agency downgraded India's growth projection to 9.6% for
2021 calendar year, from its earlier estimate of 13.9%. The credit rating agency was of the
view that a faster vaccination progress is important and is the key for restricting economic
losses to Jun quarter.
• The Prime Minister of India said that India's part of the worldwide toy business, which is
about $100 billion, is only about one-and-a-half billion dollars and as a result, he
emphasised the importance of focusing on the "toyconomy," advising the country's
gaming and toy industries to play a significant role in this sector. The Prime Minister claims
that by focusing on the toy and game industry, the country may save crores of rupees that
would otherwise be spent abroad.
3
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
4
Domestic Equity Market Indices
Indices
25-Jun-21
1 Week Return
YTD Return
S&P BSE Sensex
52,925.04
1.11% 10.83%
Nifty 50
15,860.35
1.13% 13.44%
S&P BSE Mid
-Cap
22,549.65
1.40% 25.68%
S&P BSE Small
-Cap
24,996.23
1.41% 38.12%
Source: MFI Explorer
NSE Advance/Decline Ratio
Date Advances Declines
Advance/Decline Ratio
21-Jun-21 1,255 770 1.63
22-Jun-21 1,212 792 1.53
23-Jun-21 782 1,194 0.65
24-Jun-21 783 1,186 0.66
25-Jun-21 1,070 902 1.19
Source: NSE
• Indian equity markets settled for the
week with modest gains. Markets were
initially hit by the hawkish monetary policy
outcome of the U.S. Federal Reserve.
Sentiments dampened after one of the
global rating agencies lowered India's
economic growth projection to 9.6% for
CY 2021, from its earlier estimate of
13.9%.
• However, bourses managed to shrug off
the weakness with the help of recent
record surge in daily COVID-19
vaccinations and easing of restrictions.
Robust performance of the IT and metal
sectors too supported gains. The IT sector
has drawn investors’ attention amid
prospects of sustained earnings recovery.
The favourable cues from global markets
also aided sentiments into the equity
markets.
Ratios
S&P BSE
Sensex
Nifty 50
S&P BSE
Mid Cap
S&P BSE
Small Cap
P/E
32.31 29.21 43.80 52.57
P/B
3.41 4.34 3.14 3.20
Dividend Yield
1.02 1.21 0.92 0.79
Source: BSE, NSE Va
lue as on Jun 25, 2021
Indian Equity Market
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
5
Sectoral Indices
Indices
Last
Closing*
Returns (in %)
1-Wk 1-Mth
S&P BSE Auto
23,967.21
2.49% 2.82%
S&P BSE Bankex
40,026.43
2.17% 1.72%
S&P BSE CD
35,640.16
1.01% 7.70%
S&P BSE CG
23,084.23
4.06% 3.39%
S&P BSE FMCG
13,467.25
-0.27% 3.82%
S&P BSE HC
25,099.46
1.35% 1.95%
S&P BSE IT
30,055.62
3.12% 11.41%
S&P BSE Metal
18,703.89
3.57% 0.06%
S&P BSE Oil & Gas
16,504.45
-2.15% 2.20%
Source:
Refinitiv *Value as on Jun 25, 2021
• On the BSE sectoral front, barring S&P BSE Oil &
Gas and S&P BSE FMCG, all the major indices
closed in the green. S&P BSE Capital Goods was
the top gainer, up 4.06%, followed by S&P BSE
Metal and S&P BSE IT, which went up 3.57% and
3.12%, respectively. S&P BSE Teck and S&P BSE
Auto went up 2.71% and 2.49%, respectively.
• Metal sector rose as the industry is benefitted
from reports of Russia preparing for new export
taxes from Aug 1 for steel products, nickel,
aluminium and copper, which will cost their
producers $2.3 billion. In case such measures are
implemented, the current elevated global steel
export prices may further strengthen.
Indian Derivatives Market Review
• Nifty Jul 2021 Futures stood at 15,888.00, a premium of 27.65 points above the spot
closing of 15,860.35. The total turnover on NSE’s Futures and Options segment for the
week stood at Rs. 241.06 lakh crore as against Rs. 242.76 lakh crore for the week to Jun 18.
• The Put-Call ratio stood at 0.84 compared with the previous week’s close of 0.92.
• The Nifty Put-Call ratio stood at 1.20 compared with the previous week’s close of 1.18.
Indian Equity Market (contd.)
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
6
Debt Indicators
(%)
Current
Value
1-Wk
Ago
1-
Mth
Ago
6-
Mth
Ago
Call Rate
3.13 3.19 3.20 3.23
91 Day T
-Bill
3.42 3.48 3.41 3.13
05.22% 2025, (5
Yr GOI)
5.56 5.41 5.27 5.07
05.85% 2030, (10 Yr GOI)
6.04 6.01 5.97 5.88
Source:
Refinitiv Value as on Jun 25, 2021
• Bond yields rose on consumer inflation
concerns highlighted in the Monetary
Policy Committee's (MPC) minutes last
week.
• Yields further rose as sentiment remained
bearish despite the Reserve Bank of India
(RBI) cancelled the auction of 10-year
paper at the weekly government auction.
• Yield on the 10-year benchmark paper
(5.85% GS 2030) rose 3 bps to close at
6.04% as compared to the previous week’s
close of 6.01% after moving in a narrow
range of 6.01% to 6.06%.
• According to the RBI’s data released in the
weekly statistical supplement, India’s
foreign exchange reserves fell $4.148
billion to $603.933 billion in the week
ended June 18, 2021 from $608.081 billion
in the previous week.
Domestic Debt Market
6.00
6.02
6.04
21-Jun 22-Jun 23-Jun 24-Jun 25-Jun
Yield in %
10 -Yr Benchmark Bond ( % )
Source: CCIL
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
7
Maturity
G-
Sec Yield
(%)
Corporate Yield
(%)
Spread
bps
1 Year 4.08 4.80 72
3 Year 4.88 5.49 61
5 Year 5.78 6.50 72
10 Year 6.12 7.23 111
Source:
Refinitiv Value as on
Jun 25, 2021
• Yields on gilt securities rose by up to 21 bps
across the maturities. Yield rose the most on
3-year paper and the least on 15-year paper.
• Corporate bond yields surged in the range of
7 to 17 bps across the curve. Yield went up
the most on 3-year paper and the least on 7-
to 10-year papers.
• Spread between AAA corporate bond and gilt
contracted 2 and 4 bps on 2- & 3-year papers
while 1- & 6-year papers were unchanged.
Spread on remaining securities expanded 2,
3, 5 or 12 bps.
Domestic Debt Market (Spread Analysis)
-10
0
10
20
2.80
5.10
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 25-Jun-21 18-Jun-21
Yield
in %
Change
in bps
Source: Refinitiv
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
8
• According to Minister of State for Finance, ex-gratia payments made by an employer to an
employee's family or by any individual to any other person's family on account of COVID-19
for FY20 or subsequent year would be tax-free. Ex-gratia from any other person has been
restricted to Rs 10 lakh.
• The Reserve Bank of India (RBI) has linked a non-banking financial company's (NBFC's) ability
to pay dividends to a number of parameters, including how much bad debt it has on its
books and whether it has been properly recorded. The dividend ratio, which is the
proportion of a company's net earnings divided by its annual dividend, is presently capped at
50% to 60%, depending on the organisation. Any unusual revenue during the year must be
deducted from earnings to calculate the dividend ratio. However, NBFCs that do not accept
public deposits and do not have a consumer interface will be exempt from the cap. The new
rules, according to the RBI, will infuse greater transparency and uniformity in practise. The
guidelines will be effective for declaration of dividend from the profit for the financial year
ending Mar 31, 2022 and onwards.
• As per media reports, government is likely to form a task force which will tackle the
challenges faced by employers and employees on mandatory seeding of Aadhaar for
enrollment and remittances under the Employees Provident Funds Organisation (EPFO) as it
prepares to expand the social security net while reducing duplication of beneficiaries.
Regulatory Updates in India
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
9
• The Union Ministry of Power has extended the exemption on transmission charges
until2025, which is a huge comfort for renewable energy project developers. Battery
storage, pump hydro projects, as well as solar and wind, are now included in the waiver.
• The government approved extension of Pradhan Mantri Garib Kalyan AnnaYojana (PM-
GKAY), from Jul 2021 up to Nov 2021. An additional 204 LMT of foodgrains for a period of
further 5 months will be provided to around 80 Crore National Food Security Act, 2013
(NFSA) beneficiaries with an estimated financial implication of up to Rs. 67,266 Crore.
• The Telecom Minister liberalized guidelines for Other Service Providers (OSP). Distinction
between Domestic and International OSPs were removed. With the removal of the
distinction the interconnectivity between all types of OSP centres is now permitted. No
restriction remains for data interconnectivity between any OSP centres of same company
or group company or any unrelated company.
• The Reserve Bank said that the 2020-21 round of its annual survey on computer software
and information technology enabled services (ITES) exports, whose results are used to
compile balance of payments figures, has begun. Since2002-03, the RBI has conducted an
annual survey. It gathers information on many areas of computer services exports, as well
as ITES and business process outsourcing (BPO) exports.
Regulatory Updates in India (contd..)
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
• According to the Commerce Department, U.S. real gross domestic product rose 6.4% in the
first quarter of 2021, matching the estimate provided last month. Consumer spending,
nonresidential fixed investment, federal government spending, residential fixed
investment, and state and local government spending all contributed to the high first-
quarter GDP growth. Meanwhile, falls in private inventory investment and exports, as well
as a rise in imports, partially offset the positive benefits.
• The Bank of England retained its benchmark interest rate at 0.1% and quantitative easing
at the same level as expected. The Bank of England kept its existing stock of corporate
bond purchases at GBP 20 billion and its stock of government bond purchases at GBP 875
billion, bringing total quantitative easing to GBP 895 billion. The MPC stated that it would
not tighten monetary policy until evidence of significant progress in removing spare
capacity and reaching the 2% inflation target on a long-term basis. Inflation is likely to rise
much higher than the objective due to changes in energy and other commodity costs.
• People's Bank of China (PBoC) has kept its benchmark lending rates unchanged, as widely
expected. The one-year and five-year loan prime rate (LPR) was maintained at 3.85% and
4.65%, respectively. As per an economist, PBoC has now totally reversed last year's credit
acceleration via quantitative controls. As a result, policy rate hikes that could lead to LPR
increases are unlikely to occur very soon. The key point for the economy is that tighter
lending conditions, even in the absence of rate adjustments, will act as a headwind in the
coming quarters.
10
Global News/Economy
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
11
Global Indices
Indices
25-Jun-21
1-Week
Return
YTD
Return
Russell 3000
2,173.13 2.63% 11.29%
Nasdaq 100
14,345.18 2.10% 11.30%
FTSE 100
7,136.07 1.69% 10.46%
DAX Index
15,607.97 1.04% 13.77%
Nikkei Average
29,066.18 0.35% 5.91%
Straits Times
3,121.60 -0.72% 9.77%
Source: Refinitiv
Value as on Jun 25,
2021
U.S.
• U.S. markets went up with bargain
hunting helping to overcome initial
weakness triggered by hawkish tone of
the U.S. Fed policy meeting outcome.
Bourses found additional support from
significant rebound in the value of
bitcoins and after Federal Reserve Chair
continued to downplay the risks of
inflation during testimony before the
House Select Subcommittee on the
Coronavirus Crisis.
Europe
• European markets rose, led by buoyant eurozone economic data and dovish comments
from the Bank of England Governor. Worries about inflation subsided a bit after the Bank
of England governor said the rise in consumer prices is expected to be temporary.
Asia
• Asian markets largely closed higher, amid confidence over a bipartisan Senate
infrastructure agreement in the U.S. Also, investors are waiting for the U.S. Bureau of
Economic Analysis to release its Private Consumption Expenditure statistics to have a
better direction of the market.
Global Equity Markets
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
12
• Yields on the 10-year U.S. Treasury rose 8
bps to close at 1.52%, from the previous
week’s close of 1.44%.
• U.S. Treasury price fell with U.S. Federal
Reserve officials including Chairman
reiterated that tighter monetary policy
will take some time after a hawkish turn
by the Fed last week caught markets by
surprise.
• Meanwhile, weaker than anticipated data
on U.S. jobless claims and durable goods
orders did not move yields much as
investors saw little reason for the U.S. Fed
to shift from its plans to increase interest
rates in 2023.
Global Debt (U.S.)
1.44
1.47
1.50
1.53
21-Jun 22-Jun 23-Jun 24-Jun 25-Jun
US 10-Year Treasury Yield Movement
Source: Refinitiv
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
13
Performance of various commodities
Commodities
Last Closing*
1-Week Ago
Brent Crude($/Barrel)
77.30 73.30
Gold ($/Oz)
1,780.34 1,763.34
Gold (Rs/10 gm)
46,991 47,122
Silver ($/Oz)
26.07 25.79
Silver (Rs/Kg)
68,388 68,675
Source: Refinitiv *
Value as on Jun 25, 2021
Gold
• Gold prices rose following decline in U.S.
dollar as U.S. senators reached an
agreement on the infrastructure spending
bill worth $579 billion. Bullion prices found
additional support after the U.S. Federal
Reserve Chairman said inflation would not
be the only factor of interest rate decisions
and the central bank would not rush into
raising interest rates.
Brent Crude
• Brent crude oil prices rose as investors were
optimistic about the prospects for demand
recovery ahead of OPEC meeting scheduled
next week.
Baltic Dry Index
• The index fell during the week due to
sluggish capesize and panamax activities.
Commodities Market
8.00
9.00
10.00
11.00
12.00
25-May-21 10-Jun-21
Global Commodity Movement
Gold Spot ($/Oz) Silver Spot ($/Oz) Brent ($/bbl)
Global
Commodity Prices
Rebased to 10
Source: Refinitiv
1.10%
5.46%
0.96%
25-Jun-21
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
14
Movement of Rupee vs Other Currencies
Currency
Last Closing*
1-Wk Ago
US Dollar
74.18 74.14
Pound Sterling
103.30 103.01
EURO
88.57 88.26
100 Yen
66.92 67.35
Source: Refinitiv Figures in INR , *
Value as on Jun 25,
2021
Rupee
• The Indian rupee declined against the U.S.
dollar on broad gains in U.S. dollar index and
concerns of foreign fund outflows.
Euro
• Euro rose against the U.S. dollar after U.S. Fed
Chairman reaffirmed the U.S. central bank's
intent not to raise interest rates too quickly
based only on the fear of rising inflation.
Pound
• Sterling gained against the U.S. dollar after U.S.
Fed Chairman reaffirmed the U.S. central bank's
intent not to raise interest rates too quickly
based only on the fear of rising inflation.
Yen
• Yen fell against the U.S. dollar after U.S. Fed
officials including Chairman reiterated that
tighter monetary policy will take some time
after a hawkish turn by the Fed last week
caught markets off guard.
Currencies Markets
9.50
9.75
10.00
10.25
25-May-21 10-Jun-21
USD GBP Euro JPY
Source: Refinitiv
Currency
Prices (
in terms of
INR)
Rebased to 10
Currency Movement
0.35%
0.05%
-0.64%
0.28%
25-Jun-21
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
15
The Week that was…
21
st
June to 25
th
June
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
16
The Week that was (Jun 21 – Jun 25)
Date Events
Present
Value
Previous
Value
Monday,
June 21, 2021
• U.K. Rightmove House Price Index (YoY)(Jun)
7.50% 6.70%
• U.S. Chicago Fed National Activity Index (May)
0.29 -0.09
Tuesday,
June 22, 2021
• Eurozone Consumer Confidence (Jun) PREL
-3.3 -5.1
• U.S. Existing Home Sales Change (MoM)(May)
-0.90% -2.70%
Wednesday,
June 23, 2021
• Germany Markit PMI Composite (Jun) PREL
60.4 56.2
• Eurozone Markit PMI Composite(Jun) PREL
59.2 57.1
• U.K. Markit Services PMI (Jun) PREL
61.7 62.9
• U.S. Markit PMI Composite(Jun) PREL
63.9 68.7
• U.S. New Home Sales (MoM)(May)
0.769M 0.817M
Thursday
June 24, 2021
• U.S. Gross Domestic Product Annualized(Q1)
6.40% 6.40%
• U.S. Durable Goods Orders (May)
2.30% -0.80%
• Germany IFO
– Business Climate(Jun) 101.8 99.2
Friday,
June 25, 2021
• U.K. GfK Consumer Confidence (Jun)
-9 -9
• Germany Gfk Consumer Confidence Survey(Jul)
-0.3 -6.9
• U.S. Personal Income (MoM)(May)
-2% -13.10%
• U.S. Personal Spending (MoM)(May)
0% 0.90%
• U.S. Michigan Consumer Sentiment Index(Jun)
85.5 86.4
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
17
The Week Ahead
28
th
Jun to 02
nd
Jul
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
18
Day Event
Monday,
Jun 28, 2021
•
Bank of Japan Summary of Opinions
•
U.S. Dallas Fed Manufacturing Business Index (Jun)
Tuesday,
Jun 29, 2021
•
Germany Harmonized Index of Consumer Prices (YoY)(Jun) PREL
•
Japan Unemployment Rate (May)
•
Japan Retail Trade (YoY)(Apr)
•
Eurozone Consumer Confidence (Jun)
•
U.S. Consumer Confidence (Jun)
Wednesday,
Jun 30, 2021
•
China Non-Manufacturing PMI (Jun)
•
U.K. Gross Domestic Product (QoQ)(Q1)
•
Eurozone Consumer Price Index (YoY)(Jun) PREL
•
Germany Unemployment Change (Jun)
•
U.S. ADP Employment Change (Jun)
Thursday,
Jul 01, 2021
•
India Markit Manufacturing PMI (Jun)
•
U.S. ISM Manufacturing PMI (Jun)
•
Eurozone Markit Manufacturing PMI (Jun)
Friday,
Jul 02, 2021
•
Germany Retail Sales (YoY)(May)
•
U.S. Nonfarm Payrolls (Jun)
•
U.S. Unemployment Rate (Jun)
The Week Ahead
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
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
assures the accuracy or authenticity of such data and information. Some of the statements & assertions contained in these materials may reflect NAM
India’s views or opinions, which in turn may have been formed on the basis of such data or information. The Sponsor(s), the Investment Manager, the
Trustee or any of their respective directors, employees, associates or representatives do not assume any responsibility for, or warrant the accuracy,
completeness, adequacy and reliability of such data or information. Whilst no action has been solicited based upon the information provided herein,
due care has been taken to ensure that the facts are accurate and opinions given are fair and reasonable, to the extent possible. This information is
not intended to be an offer or solicitation for the purchase or sale of any financial product or instrument. Recipients of this information should rely
on information/data arising out of their own investigations. Before making any investments, the readers are advised to seek independent
professional advice, verify the contents in order to arrive at an informed investment decision. None of the Sponsor(s), the Investment Manager, the
Trustee, their respective directors, employees, associates or representatives shall be liable in any way for any direct, indirect, special, incidental,
consequential, punitive or exemplary damages, including on account of lost profits arising from the information contained in this material.
All information contained in this document has been obtained by ICRA Analytics Limited from sources believed by it to be accurate and reliable.
Although reasonable care has been taken to ensure that the information herein is true, such information is provided ‘as is’ without any warranty of
any kind, and ICRA Analytics Limited or its affiliates or group companies and its respective directors, officers, or employees in particular, makes no
representation or warranty, express or implied, as to the accuracy, suitability, reliability, timelines or completeness of any such information. All
information contained herein must be construed solely as statements of opinion, and ICRA Analytics Limited, or its affiliates or group companies and
its respective directors, officers, or employees shall not be liable for any losses or injury, liability or damage of any kind incurred from and arising out
of any use of this document or its contents in any manner, whatsoever. Opinions expressed in this document are not the opinions of our holding
company, ICRA Limited (ICRA), and should not be construed as any indication of credit rating or grading of ICRA for any instruments that have been
issued or are to be issued by any entity.
19
Disclaimer
Thank you for
your time.
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.
Thank you for
your time.
