9 macro triggers that market would watch today

The Financial Stability and Development Council (FSDC), headed by Finance Minister Arun Jaitley, will meet today to take stock of the prevailing economic situation. Fiscal situation, external sector environment, financial sector reforms, rising non-performing assets and regulatory issues are likely to figure in the meeting.

Here’s a lowdown on nine macro triggers that are likely to impact the market on Tuesday. This report was compiled from agency feeds.

Consumer Confidence Dips
Two separate surveys undertaken by AC Nilesen and Mastercard point to a dip in consumer confidence in India. According to the Nielsen survey, consumer confidence in India dropped eight%age points in Q2 of 2017 from the previous poll conducted by the organisation in the fourth quarter of 2016. Nielsen attributed the fall to lower optimism on job prospects, concerns around job security and a caution in spending. India dropped from the top spot globally, but at No. 2, continued to reflect high confidence that it has held for the past three years. The Mastercard survey showed consumer confidence in India witnessing the largest decline for the first half of this year compared to July-December period of 2016 as consumer outlook on the economy and quality of life parameters suffered.

GST Hits India Inc. Profits
India Inc profits dipped by 15.7% to Rs 87,475 crore in the first quarter of the current fiscal, largely owing to destocking of goods by companies before execution of GST regime from July 1, said a report yesterday. According to an analysis of 2,108 companies by credit rating agency Care Ratings, the corporate net profits stood at about Rs 1.04 lakh crore in April-June period of 2016-17. Net sales slowed down to 8.7% in the three months ended June 2017, after registering a growth of 9.5% in the same period year-ago. Seven industries reported net loss, while 33 segments reported lower growth in net profit y-o-y in Q1. The maximum drop was in consumer goods, automobiles and related segments, construction & real estate, finance, refineries, paper & paper products, pesticides & agrochemicals sectors.

Another Rate Cut in Dec?
Retail inflation is likely to stay well within the RBI’s 2-6% mandate in the coming months and accordingly, the central bank is expected to cut policy rates by 25 bps on December 6, says a report. According to Bank of America Merrill Lynch (BofAML), inflationary pressures are expected to remain contained by good rains, low growth and subdued imported inflation amid decrease in global commodity prices. The global brokerage firm said that after a pause in the October policy review meet, the Reserve Bank is expected to go for a 25 bps cut in key policy rates in its December 6 meet.

Anti-dumping Duty
India has imposed anti-dumping duty on tempered glass, used mostly to protect touchscreen mobile devices, from China for five years to protect the domestic industry from belowcost imports. The duty, ranging between $2.85 and $136.21 per tonne, has been levied on textured toughened (tempered) coated and uncoated glass. Investigations by the Directorate General of Anti-Dumping and Allied Duties had found that the tempered glass has been exported to India from China below its associated normal value and that the domestic industry has suffered material injury which was caused by the dumped imports of the goods from China.

FDI jumps 37% to $10.4 Bn in Q1
Foreign direct investment (FDI) into the country grew by 37% to $10.4 billion during the first quarter of the current fiscal, according to DIPP. India had received $7.59 billion FDI during April-June 2016-17. The main sectors which attracted the highest foreign inflows include services, telecom, trading, computer hardware and software and automobile. Bulk of the FDI came in from Singapore, Mauritius, the Netherlands and Japan.

ONGC Board Okays HPCL Takeover
The board of state-owned Oil and Natural Gas Corp has given ‘in-principle’ approval to acquire government’s 51.11% stake in Hindustan Petroleum Corp Ltd, the company said in a regulatory filing. The board at its meeting yesterday constituted a committee of directors to “examine various aspects” of the acquisition and “to provide its recommendations to the board of directors”, it said. The government last month had approved sale of its 51.11% stake in oil refiner HPCL to India’s largest oil producer ONGC.

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Taxes : As much as Rs 42,000 crore has already come in as taxes so far in the first monthly filing under the new Goods and Services Tax (GST) regime and the revenues are expected to swell further as the filing cycle closes later this week. So far, 10 lakh tax payers have filed returns and another 20 lakh have logged in and saved return forms.

Rupee Flat: The rupee closed at 64.14 a dollar on Monday, up 0.01% from its Friday’s close of 64.15.

Bonds Down : Government bonds (G-Secs) slipped on selling pressure from banks and corporates. The 6.79% G-secs maturing in 2027 eased to Rs 101.98 from Rs 101.99, while its yield remained steady at 6.51%. The 6.79% G-secs maturing in 2029 dipped to Rs 99.5925 from Rs 99.6850, while its yield edged up to 6.84% from 6.83%. The 6.97% G-secs maturing in 2026 remained steady at Rs 101.65 from its Friday’s close, while its yield to remained stable at 6.72%.

Call Rates Up : The overnight call money rates finished higher at 6.05% from Friday’s level of 5.80%. It resumed higher at 6.00% and moving in a range of 6.10% and 5.95%.

Liquidity: The Reserve Bank of India, under the Liquidity Adjustment Facility, purchased securities worth Rs 11914 crore in 21-bids at the overnight repo operation at a fixed rate of 6.00% as on Monday, while it sold securities worth Rs 4187 billion in 21-bids at the 2-day reverse repo auction at a fixed rate of 5.75% as on August 19.

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