Outliers in spending included the ministries of housing (35%), road (34%), railways (34%), health (32%), and atomic energy (30%) amid tepid growth in central government capital expenditure from April to July. According to government data, they spent more than the average of 24% on total capital expenditures throughout the four-month period. The Centre's capex in Q1 was ₹1.8 trillion, which is roughly 33% lower than the ₹2.7 trillion recorded during the same period last year.
Top 3 Leads Today
- EVs get ₹140 billion double shot: Boost for ambulances, buses, trucks.
- Cabinet allocates ₹124.61 billion for revised hydro projects scheme.
- EIA sees crude prices rising again in coming months as inventories fall.
Indian Markets
- Money Markets Minute: The call rate dropped to 5.75% from 6.40% on Tuesday, as banks saw low demand for funds. Despite a recent decline, surplus liquidity remains sufficient, keeping the rate below the RBI's standing deposit facility rate of 6.25%. The weighted average call rate was 6.54%, slightly up from 6.50% on Tuesday.
- Government Bond Brief: Bond yields fell as US Treasury yields dropped overnight. The 10-year benchmark 7.10%, 2034 bond closed at a 6.83% yield, down from 6.85% on Tuesday. Turnover surged to ₹744.45 billion, compared to ₹326.15 billion on Tuesday.
- Corporate Bond Beat: Yields in the secondary market stayed within a narrow range as investors engaged in need-based trading. Trading volume remained muted, with combined deals totalling ₹41.77 billion on the exchanges, slightly down from ₹42.23 billion on Tuesday.
- Forex Flash: The rupee traded in a tight 5-paise range and ended flat against the dollar as foreign bank dollar sales for fund inflows were offset by oil companies' dollar purchases. It settled at 83.9775 per dollar, near its record low of 83.9900, compared with Tuesday's close of 83.9750.
- Stocks Spotlight: Investors booked profits in the last two hours amid caution ahead of US CPI data. Gains over the past two days had sparked hopes of a Nifty 50 recovery after last week's decline. The Sensex fell 0.5% to 81,523.16, and the Nifty 50 dropped 0.5% to 24,918.45.
International Markets
- US Stocks: On Wednesday, the technology sector lifted all three major stock indexes after inflation report dashed market hopes of a 50-basis-point Federal Reserve rate drop next week. The Labor Department stated that the CPI grew 0.2% last month, in line with July. Core CPI, excluding volatile food and energy components, climbed 0.3% monthly, beating economists' estimates of a 0.2% increase. The Dow index rose 0.31% to 40,861.71, the S&P 500 jumped 1.07% to 5,554.13, and the Nasdaq jumped 2.17% to 17,395.53.
- Treasuries: Yields on 10-year treasury notes firmed up following an earlier plunge in which the benchmark yield reached its lowest level since June 2, 2023. The CPI report on Wednesday, the last significant piece of economic data before the Fed's meeting next week, provided the Fed more justification to cut interest rates, albeit tentatively. Benchmark 10-year note yields rose marginally to 3.6609% from 3.644% on Tuesday. The 30-year bond yield ended at 3.9743%, up from 3.954% on Tuesday.
- Currency: The US dollar ended mixed in volatile trading on Wednesday as data revealed that underlying inflation in the world's largest economy increased in August, bolstering predictions that the US Fed will go for a smaller 25-basis-point interest rate cut next week. The greenback rose against the Swiss franc, sterling, and yen, but fell against the euro, pushing the dollar index against six major currencies, 0.01% lower on the day to 101.63.
Trading Trends
Traded volume(in Cr) in corporate bonds by sector and maturity:
| Sectors | 0-1y | 1-3y | 3-5y | 5-10y | >10y |
|---|---|---|---|---|---|
| Financial Institution | 1225 | 1285 | 454 | 367 | 100 |
| NBFC | 1295 | 1012 | 269 | 436 | 110 |
| REITs | - | 730 | - | - | - |
| Housing Finance Company | 130 | 9 | 424 | 104 | - |
| Investment Company | - | 481 | - | - | - |
Secondary trade details for recently issued primary corporate bonds:
Security Name |
Issue Date |
Trades Since Issue(Cr) |
Avg Yield(%) |
LTY (%) |
|---|---|---|---|---|
| 8.27 CANARA BANK PERP 29AUG29 C | 2024-08-29 | 1790 | 8.27 | 0.00 |
| 7.22 HPCL 28AUG29 | 2024-08-28 | 1074 | 7.22 | 7.22 |
| 7.61 LICHSGFIN 29AUG34 | 2024-08-29 | 525 | 7.61 | 7.60 |
| 7.37 IIFCL 02SEP34 | 2024-09-02 | 525 | 7.36 | 7.38 |
| 7.30 BOB 27AUG34 | 2024-08-27 | 450 | 7.30 | 7.30 |
| 7.45 AXISBANK 05SEP34 | 2024-09-05 | 440 | 7.44 | 7.45 |
| 8.55 CENTURYTEX 30AUG29 | 2024-08-30 | 350 | 8.57 | 8.58 |
| 7.72 THDC 02SEP34 | 2024-09-03 | 345 | 7.72 | 7.72 |
| 7.74 LICHSGFIN 11FEB28 | 2024-08-29 | 285 | 7.76 | 7.76 |
| 7.42 SBI 29AUG34 C 29AUG39 M | 2024-08-29 | 270 | 7.41 | 7.42 |
| 8.35 CENTURYTEX 30AUG27 | 2024-08-30 | 250 | 8.35 | 8.35 |
| 8.70 ADANI ENERGY SOLUTIONS LTD 28AUG2034 | 2024-08-27 | 240 | 8.50 | 8.50 |
| 8.35 JSW STEEL LIMITED - CALL 29AUG2029 M | 2024-08-29 | 220 | 8.34 | 8.34 |
| 9.50 AFL 23AUG34 | 2024-08-27 | 160 | 9.32 | 9.30 |
| 8.43 JSW STEEL LIMITED - CALL 29AUG2031 M | 2024-08-29 | 150 | 8.43 | 8.43 |
| 8.00 DATAINFRA - C 29AUG34 M | 2024-08-29 | 145 | 8.08 | 8.08 |
| 9.25 MOFSL 03SEP32 | 2024-09-03 | 125 | 9.23 | 9.24 |
| 7.9918 L&T FINANCE 25MAR27 | 2024-09-05 | 125 | 8.02 | 8.02 |
| 7.25 IRFC 29AUG34 | 2024-08-29 | 115 | 7.25 | 7.25 |
| 8.10 ABFL 07SEP29 | 2024-09-09 | 80 | 8.11 | 8.11 |
| 8.0490 ADITYA BIRLA HFL 03DEC27 | 2024-09-05 | 70 | 8.04 | 8.07 |
| 9.03 CREDILA 04MAR26 | 2024-09-04 | 60 | 9.12 | 9.10 |
| 10.75 MIDLANDMICROFIN 27AUG26 | 2024-08-27 | 57 | 12.02 | 12.73 |
| 8.8871 HEROFINCORP 06OCT26 | 2024-09-06 | 57 | 8.91 | 8.90 |
| 8.40 GODREJHSGFIN 05JAN28 | 2024-09-05 | 50 | 8.42 | 8.42 |
Source: Harmoney data analytics
Events This Week
September 12, Thursday:
- US Unemployment Insurance Weekly Claims Report for Sep 7 week.
- US PPI for August.
- US Weekly Export Sales.
- India Industrial Production for July.
- India Inflation Rate for August.
- India Manufacturing Production for July.
- India Passenger Vehicles Sales for August.
September 13, Friday:
- US Import & Export Price Indexes for August.
- India Foreign Exchange Reserves for Sep 6 week.
For any inquiries or assistance related to market data, please reach out to us at support@harmoney.in