July 4, 2019 / 3:03 AM / 14 days ago

Morning News Call - India, July 4

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    FACTORS TO WATCH
    No major events are scheduled for the day.
    
    LIVECHAT - BONDS UPDATE
    Reuters European Government Bonds Correspondent Virginia Furness delves into
fixed income markets at 5:00 pm IST. To join the conversation, click on the
link: refini.tv/2P8N0Wp
    
    
    INDIA TOP NEWS
    • PREVIEW-India's budget likely to hike spending to combat slumping growth
    Indian Prime Minister Narendra Modi's government on Friday will unveil a
budget that is expected to cut taxes on business and raise spending in a bid to
shore up consumption and faltering economic growth.
    • RBI to regulate housing finance firms, review assets - sources
    India will soon give the Reserve Bank of India (RBI) power to regulate
housing finance companies, which will almost certainly lead to the lenders
facing stringent asset quality reviews, two sources with direct knowledge of the
matter said.
    • Modest rise in Indian military spending likely, modernisation on hold
    India is likely to stick to a modest rise in defence spending in the
2019/2020 budget due on Friday because of tight government finances, officials
said, further delaying a long-planned military modernisation programme.

    • India's services activity contracts in June for first time in a year
    India's dominant services activity contracted for the first time in more
than a year in June, dragged down by slowing new business growth which in turn
curtailed hiring, a private survey showed on Wednesday.
    • POLL-Going for growth, India set to borrow more - economists
    India's government will turn on the fiscal taps in the federal budget on
Friday and revise its borrowing target slightly higher for this year and next,
prompted by a slowing economy and weak jobs growth, a Reuters poll of economists
showed.
    • Owner of India's biggest media house faces shareholder backlash
    A group of minority shareholders in India's Bharat Nidhi Ltd, a company
owned by Indian media baron Vineet Jain, have sent multiple complaints to the
market regulator against a proposed share buyback they say "grossly undervalues"
the company.
    • L&T buys controlling stake in Mindtree
    Mindtree Ltd said on Wednesday that conglomerate Larsen & Toubro Ltd has
acquired a 60.06% stake in the Indian IT services company.
    
    
    GLOBAL TOP NEWS
    • Trump officials say U.S.-China trade talks to resume next week
    Top representatives from the United States and China are arranging to resume
talks next week to try to resolve a year-long trade war between the world's two
largest economies, Trump administration officials said on Wednesday.

    • Rahul Gandhi calls for change as he quits as Congress leader
    Rahul Gandhi, leader of opposition Congress party, said on Wednesday he had
asked party bosses to find a successor after he took responsibility for losing a
general election that has left the party in crisis.
    • North Korea says U.S. 'hell-bent on hostile acts' despite wanting to talk
    North Korea's mission to the United Nations accused the United States on
Wednesday of being "more and more hell-bent on hostile acts" against Pyongyang,
despite President Donald Trump wanting talks between the two countries.

    
    
    LOCAL MARKETS OUTLOOK
    (As reported by NewsRise)
    • SGX Nifty nearest-month futures were 0.1% higher at 11,962.00. 
    • The Indian rupee is expected to open higher against the dollar following
disappointing U.S. data, which increased the likelihood of aggressive monetary
easing by the Federal Reserve. 
    • Indian government bonds are likely to trade higher in early session
tracking a fall in U.S. treasury yields, even as traders await the country’s
annual economic survey and tomorrow’s federal budget announcement. The yield on
the benchmark 7.26% bond maturing in 2029 is likely to trade in a range of 6.80%
- 6.85% today.
    
    
    GLOBAL MARKETS
    • U.S. stocks rose on Wednesday, with each of the major indexes closing at a
record high, as expectations grew that the Federal Reserve would take a more
dovish turn as a raft of data provided more evidence of a slowing economy.
    • Asian stocks advanced, tracking sharp gains on Wall Street as recent data
from multiple sectors pointed to slowing economic growth in the United States,
bolstering the prospect of rate cuts by the Federal Reserve.
    • The dollar was on the back foot, trading near a one-week low versus the
yen as falling Treasury yields fuelled expectations the U.S. Federal Reserve
will cut interest rates this month for the first time in a decade.
    • U.S. Treasury yields fell on Wednesday with 10-year yields hitting their
lowest in over 2-1/2 years as euro zone yields tumbled on record lows on bets
the European Central Bank's next chief would stay a dovish course to help the
euro zone economy.
    • Oil prices inched lower after solid gains the day before, pressured by
data showing a smaller-than-expected decline in U.S. crude stockpiles.
    • Gold prices were steady after hitting a one-week high in the previous
session, as gains in stock markets offset support from a weaker dollar and
prospects of an interest rate cut by the U.S. Federal Reserve.
    
                   CLOSE        FII INVESTMENTS  EQUITIES      DEBT
 PNDF spot         68.91/68.94  July 3           -$56.68 mln   -$74 mln
 10-yr bond yield  6.83%        Month-to-date    -$350.24 mln  $43.91 mln
                                Year-to-date     $10.99 bln    -$1.36 bln
    
    
    For additional data:
    India govt bond market volumes                 
    Stock market reports                
    Non-deliverable forwards data              
    Corporate debt stories               [IN CORPD]
    Local market closing/intraday levels [IN SNAPSHOT]
    Monthly inflows                      [INFLOWS RTRS TABLE IN]
    

    ($1 = 68.8090 Indian rupees)
    
    

 (Compiled by Samrhitha Arunasalam in Bengaluru)
  
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