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Weekly wrap-up: Market updates, news and insights for the week ending 26th April, 2019
Publish date: 26th April, 2019
NEWS: NIFTY SEE-SAWS THROUGH THE WEEK BUT ENDS ON POSITIVE NOTE
Perspective:
- Nifty and Sensex were volatile during the week on most days but closed very near to their all-time highs on Friday.
- The markets were driven by volatility in crude prices and the sharp movements in the rupee. Results season also added to the market volatility.
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News: BRENT CRUDE RETREATS AFTER TOUCHING A YEARLY HIGH OF $75.60/BBL
Perspective:
- Pressure on oil prices came from supply cuts from Russia and the US refusing to extend the sanction waiver to nations to purchase oil from Iran.
- At higher levels, the concerns over global growth and the likely impact on oil demand continued to be the key factors putting a ceiling on oil prices.
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NEWS: FINANCIAL CREDITOR STATUS DOES LITTLE FOR INDIAN HOME BUYERS
Perspective:
- Even with financial creditor status accorded to home buyers by the IBC, buyers have been reluctant to join hands and use the facility
- The tendency has been to negotiate privately with the builders as a result of which the home buyers have not shown too much interest in the IBC route.
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NEWS: MICROSOFT BECOMES WORLD’S MOST VALUABLE COMPANY AT $1 TRILLION
Perspective:
- On the back of solid numbers in the March quarter, Microsoft touched the $1 trillion market cap mark for the first time in history, becoming the most valuable stock
- Earlier, Apple and Amazon had crossed the $1 trillion market cap mark in the year 2018 but had failed to sustain at higher levels on valuation concerns on FANG stocks
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NEWS: RBI CALLS FOR MANDATORY DISCLOSURE OF BANK’S IL&FS EXPOSURE
Perspective:
- The NCLT order had given special powers to banks not to disclose details of their exposure to IL&FS, but RBI was not happy as it infringed on banking regulation
- RBI has instructed all the banks to disclose their exposure to IL&FS with immediate effect; both direct and indirect to give a more transparent picture
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NEWS: RBI SETS HIGHER CUT OFF FOR DOLLAR SWAP AUCTIONS
Perspective:
- The second round of dollar swap auctions of $5 billion was done at a premium of Rs.8.38 for a 3 year maturity.
- This resulted in expansion of the forward premiums on the dollar and was instrumental in the weakening of the rupee. Even at these levels, there was 3-fold demand from banks.
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NEWS: INDIA CONFIDENT OF STEADY CRUDE SUPPLY EVEN POST IRAN SANCTIONS
Perspective:
- With the US unwilling to budge on giving further Iran waivers, India is confident of a second line of crude supply from other sources in the Middle East and the Americas
- The 6 month extension granted by the US expires on May 02nd and India may not be too keen to import oil from Iran in contravention of US sanctions.
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NEWS: ASIA WITNESSES RECORD FPI INFLOWS INTO BONDS IN MARCH 2019
Perspective:
- Foreign portfolio investors infused $5 billion into Asian bonds with India and Indonesia being the main recipients of flows followed by Korea and Taiwan
- With currencies stabilizing in most of the EMs, the bond flows are back into EMs in search of higher yields as the monetary tightening cycle falters globally
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By: Sandhya Kannan, Head – Content
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