The News International Team
09:55am Gold Update
Gold held above USD 1,200 an ounce, retaining most of its sharp overnight gains following a bout of profit-taking in the dollar, but optimism over the US economy and possibility of higher rates kept investors wary.
Spot gold slipped slightly to USD 1,203.30 an ounce by 0249 GMT. It had jumped 1.3 percent on Monday in its biggest one-day gain in two months as physical buyers and bargain hunters lent support following earlier lows.
The metal is still not too far from a low of USD 1,183.46 reached earlier on Monday – its weakest since June 2013 – as a strong US jobs report dented its safe-haven appeal, reports Reuters.
09:35am FII View
Christopher Wood of CLSA says despite claims in some quarters that Narendra Modi is not living up to expectations, all the evidence is that he is quietly getting on with business while, sensibly, not being distracted by excessive interaction with the media.
“The most meaningful change Modi has instigated for ordinary people is his focus on financial inclusion via Jan Dhan Yojana. Another sensible approach being pursued by Modi is to encourage individual states to compete for investment. This dynamic should turn India’s federal structure from a negative to a positive,” he adds.
09:15am Market Check
After a long weekend of five days, equity benchmarks started of Tuesday’s trade on a (marginally) lower note with the Sensex falling 22.52 points to 26545.47 and the Nifty losing 11.25 points to 7934.30.
However, the broader markets outperformed benchmarks with the BSE Midcap and Smallcap indices rising 0.4 percent each. About 595 shares have advanced, 309 shares declined, and 52 shares are unchanged.
Shares of ITC, HDFC Bank, HUL, Infosys, Dr Reddy’s Labs and UltraTech Cement lost 0.8-1.4 percent while TCS, BHEL, Coal India, ICICI Bank, NTPC, HCL Technologies and BPCL gained 0.7-2 percent.
The Indian rupee opened higher by 20 paise on Tuesday at 61.41 per dollar against 61.61 a dollar on last Wednesday.
There is a flat trade for the dollar today after rising to a four-year high of 86.746 on Friday.
Ashutosh Raina of HDFC Bank said, “The recent US non-farm payrolls number fuelled the speculation that US Federal Reserve may hike interest rates sooner than expected which sent the dollar index to near-term highs.”
“The USD-INR pair continues to trade in the 61-62 range, tracking the choppy and volatile global markets,” he added.
On the global front, Asian markets were trading mixed. Hang Seng, Nikkei and Kospi saw marginal gains while Straits Times and Taiwan Weighted declined. Protest in Hong Kong that started a week ago has been demanding the right to choose a candidate for the chief executive role in 2017.
In the US, stocks fell with investors adopting a cautious approach two days before the release of minutes from the Federal Reserve’s last meeting and quarterly earnings. The federal open market committee releases minutes from its last session on Wednesday, with the Federal Reserve on track to conclude its bond purchases this month.
And in Europe, it was a positive start to the week although the German DAX pared gains following disappointing economic data from the country.