Daily Market Report: Thursday - December 6, 2012
Author(s): City Air NewsThe Indian Rupee opened at 54.37 levels after closing yesterday at 54.54 levels. The Intraday range for the rupee is seen between 54.30-54.60 levels. The UPA coalition government won a vote on allowing foreign supermarkets...
The Indian Rupee opened at 54.37 levels after closing yesterday at 54.54 levels. The Intraday range for the rupee is seen between 54.30-54.60 levels.
The UPA coalition government won a vote on allowing foreign supermarkets to operate in Asia's third-largest economy on Wednesday, in a key test of support flagship economic reform. The government won the motion by 253 votes to the opposition's 218 with the Bahujan Samaj Party and the Samajwadi Party abstaining.
The parliamentary approval was discounted to an extent by the markets making the stock market to rally in recent days and also helping the local currency. The Upper house (Rajya Sabha) vote on Friday remains a challenge. The approval from upper house could boost the sentiment but again we expect that to be for a short period.
The Asian markets are trading positive as all industry groups advanced after data on U.S. services and factory orders beat estimates. Sentiment was also supported after the US President Obama said a fiscal agreement was possible within a week.
Better than expected U.S. economic data and a strong rally in equities led to an ambiguous performance in the U.S. dollar. The Euro is trading lower today against the dollar, for the first time in last 6 trading days.
The Euro was seen hitting a seven-week high against the dollar yesterday as efforts to tackle the debt crisis in Greece and subsiding concerns about Spain improved investor appetite for Euro zone assets.
The US 10 year treasury yield is trading lower at 1.59%. The Indian 10-year bond yield flat at 8.17%. The Call money rate ended at 8.00/8.10% versus its close of 8.05/8.10% on Tuesday.
Outlook: Exporters were already asked to cover around 55.50 levels for next 2-3 months. The Importers should look to cover below 54.50 levels. The importer should cover 30% -50% for Dec, Jan & Feb. The market is correcting, opportunities should be taken by importers to cover the un hedged exposure. Overall USDINR bullish.
(Source: Corporate Communications, India Forex Advisors Pvt. Ltd.)