Last week US markets got spooked after concerns were raised about Donald Trump’s Presidency and a possible impeachment attempt, after two new reports came in related to a federal investigation into possible coordination between Russia and Trump’s election campaign.
Political tensions mounting up in USA & Brazil may unsettle global markets.Minutes of the FOMC will be released this week wherein market participants will be looking for cues on the timing of Fed’s next rate hike.
The Goods and Services Tax (GST) council on Thursday fixed tax rates on 1211 items under 98 categories , most of which will likely become cheaper as the new rates will be lower than the current effective levies.
The GST rates are highly positive for the Indian economy and Inflation and once the math is done and the dust settles down, we expect market to react positively to the same.
The Nifty Index futures saw fall in open interest by 10% for the May series. There was a rise in open interest by 68% and 94% for June and July series respectively in the last week. Implied volatility(IV) fell for put and rose for call option in the last week. Fall in IV for put and rise in call option shows unsteady support for Nifty at present levels.
The Japanese economy advanced 0.5% in the March quarter 2017, following a 0.3% growth in the previous period and above market expectation of a 0.4% growth. It was the strongest expansion since the first quarter 2016, supported by private consumption, exports and an unexpected rise in capital expenditure. On an annualised basis, the economy expanded 2.2%.
Euro posted a current account surplus which increased to an all-time high of 44.8 billion Euros in March 2017, compared to 38.6 billion Euros a year ago. Services surplus widened to 9.7 billion Euros while goods surplus narrowed to 37.9 billion Euros. Primary income surplus rose to 8.4 billion Euros and secondary income deficit declined to 11 billion Euros.
The achaten-suisse.com central bank of Mexico unexpectedly raised its benchmark interest rate by 25 bps to 6.75% on May 18th policy meeting. Mexico’s annual inflation accelerated for the tenth straight month to a near eight-year high of 5.82% in April 2017, affected mainly by the liberalization of gasoline prices and by the Mexican Peso’s depreciation.
Stocks of crude oil in the United States fell by 1.753 million barrels in the week ended 12th May 2017, following a 5.247 million decrease in the previous period and compared to market expectations of a 2.36 million decline. It is the sixth consecutive week of inventory fall. Last week, Brent crude oil price rose by 5.4% to USD 53.61.
Wall Street extended gains on Friday, with all three major indices advanced after two days of the worst selloff of 2017 triggered by political scandal in Washington. Gains were broad on Friday, with tech and energy shares outperforming amid strong corporate results and a rally in oil, respectively. On weekly basis, Dow Jones fell by 0.44%, Nasdaq fell by 0.62%, S&P 500 fell by 0.38%.
Brazil’s iBovespa index gained 1.7%, to 62639, a day after the benchmark index fell by 8.8 percent triggered by a bribery scandal involving the President of Brazil. Gains were broad, with mining stocks also boosted by recovering commodity prices. On weekly basis, iBovespa fell by 8.43% last week.
The Sensex and the Nifty gained by 0.92% and 0.30% respectively in the last week.
The Goods and Service Tax (GST) council on 18th May 2017 approved rates for 1200 items. GST council had categorised 1200 items under 5%, 12%, 18% and 28% tax slabs. This announcement also boosted the chances of GST implementation on 1st July 2017.
India trade gap widened by 173% (Y-o-Y) to USD 13.25 billion in April 2017, above market expectations of a USD 12.79 billion gap. It is the highest shortfall since November 2014, due to a jump in oil and gold imports. Total purchases surged 49% (Y-o-Y) to USD 37.88 billion, boosted by a 30% rise in oil imports and a 211% increase in gold. Exports went up 19.8% to USD 24.6 billion.
JSW Steel is planning to have a long-term iron ore linkage arrangement with Odisha government-owned Odisha Mining Corporation (OMC), in order to secure supplies for its planned 10 million tonne mega steel plant. The company has committed an investment of Rs 500 billion. This will help the company to ramp up the supply to meet the demand. Share price of JSW steel fell by 2.30% in last week.
IFC ltd, has proposed to invest up to USD 100 million in securities issued by M&M Financial Services Ltd. The investment will support lending by the NBFC to the farm sector. It will go towards financing the purchase of farm equipment, mainly tractors, and a range of utility and commercial vehicles.
Apollo Tyres is planning to use Rs. 25 billion as capex for the current financial year and company also eyes a double – digit volume growth. Share price of Apollo Tyres rose by 4% in last week.