In a positive sign, the urban unemployment rate fell to a new low of 6.4% in the September quarter of the current fiscal year, the lowest since data collection began in 2017, thanks to a sharper drop in female unemployment, according to the quarterly Periodic Labour Force Survey data for urban India released by the National Statistical Office on Monday. The unemployment rate in Q1FY25 fell to 6.6% from a four-quarter high of 6.7% in Q4FY24.
Top 3 Leads Today
- RBI Governor Das cautions that over-reliance on specific sectors may heighten risks for banks.
- The World Gold Council reports that RBI's gold reserves hit a record high of 882 tonnes in October.
- SBI’s Setty expects better deposit growth for the bank during the October-March period.
Indian Markets
- Money Markets Minute: The call rate ended below the RBI's standing deposit facility rate of 6.25%, as demand for funds eased and liquidity surplus remained comfortable. The one-day call money rate closed at 5.75%, down from 6.00% for two-day loans on Saturday. The weighted average call rate rose to 6.43%, compared with 6.16% on Saturday.
- Government Bond Brief: Yields edged up as the 10-year US Treasury yield rose toward the end of domestic trading. Earlier, bonds traded positively, driven by state-owned banks buying gilts deemed attractive when the 10-year benchmark yield exceeded 6.85%. The benchmark 7.10%, 2034 bond yield closed at 6.86%, unchanged from Thursday, after briefly hitting 6.85% intraday. Market turnover dropped to ₹242.05 billion from ₹416.00 billion on Thursday.
- Corporate Bond Beat: Corporate bond yields began the week steady, remaining largely unchanged as investors focused on the primary market. State Bank of India invited bids for its ₹100-billion infrastructure bond issue. Exchange-recorded deals totalled ₹64.19 billion, down from ₹91.49 billion on Thursday.
- Forex Flash: The rupee remained largely stable at 84.3850 against the dollar, narrowly avoiding its record closing low of 84.3950 from Thursday. Likely, RBI-backed dollar sales by state-owned banks offset demand from importers and foreign portfolio investors. However, following US Federal Reserve Chair Jerome Powell's Thursday speech, the rupee faced pressure from a strong dollar index. The currency traded within a tight range of 3 paise throughout the day.
- Stocks Spotlight: The Nifty fell for a seventh straight session, its longest losing streak since February 2023, as IT and energy stocks slumped. The Sensex swung 900 points before closing 0.3% lower at 77,339, while the Nifty ended down 0.34% at 23,454. Weak Q2 earnings, foreign outflows, and Fed rate concerns weighed on market sentiment.
International Markets
- US Stocks: The Nasdaq and S&P 500 finished higher on Monday, regaining some losses as investors await quarterly reports from AI pioneer Nvidia, and Tesla rose on the potential of favourable policy changes from the new Trump administration. Nvidia will announce its Q3 earnings on Wednesday. The Dow Jones Industrial Average dipped 0.13% to 43,389.60, while the S&P 500 rose 0.39% to 5,893.62, and the Nasdaq Composite rose 0.60% to 18,791.81.
- Treasuries: The yield on the benchmark US 10-year notes fell 1 basis point to 4.416% as the US Treasury yields dipped and lost gains during volatile trading. The 10-year yield indicates that the bond market believes there is still risk to the budget and deficit, as well as the possibility of inflation in the system if tariff hikes are implemented. This may limit further interest rate cuts by the US central bank.
- Currency: The dollar fell but hovered near one-year highs as speculators reduced Fed interest-rate cut forecasts. The incoming administration may decrease taxes and raise tariffs, boosting inflation and limiting the Fed's rate cuts. The dollar-yen rise resumed its recent ascent after Japan's top central bank official predicted further monetary policy tightening. The dollar rose 0.29% against the yen to 154.605. The dollar index, which measures the currency against a basket of six others, fell 0.51% to 106.19, trading slightly below its one-year high of 107.07.
Trading Trends
Secondary trade details for recently issued primary corporate bonds:
Security Name |
Issue Date |
Trades Since Issue(Cr) |
Avg Yield(%) |
LTY (%) |
|---|---|---|---|---|
| 7.70 FEDERAL BANK 11NOV34 | 2024-11-11 | 480 | 7.76 | 7.76 |
| 7.32 IREDA 04NOV29 | 2024-11-04 | 336 | 7.32 | 7.31 |
| 7.47 IIFCL 07NOV27 | 2024-11-07 | 290 | 7.47 | 7.47 |
| 11.00 GMR INFRA 13NOV27 | 2024-11-13 | 200 | 15.93 | 15.94 |
| 7.26 IIFCL 07NOV34 | 2024-11-07 | 175 | 7.26 | 7.27 |
| 8.03 POONAWALLA FINCROP 07NOV29 | 2024-11-07 | 108 | 8.02 | 7.95 |
| 8.90 BHARATI TELECOM 05NOV31 | 2024-11-05 | 100 | 8.72 | 8.77 |
| 9.45 OXYZO FINSERV 11NOV26 | 2024-11-11 | 90 | 9.90 | 10.50 |
| - AURORE LIFE SCIENCES PRIVATE LIMITED 05NOV28 | 2024-11-05 | 60 | 13.22 | 15.00 |
Source: Harmoney data analytics
Events This Week
November 19, Tuesday:
- US New Residential Construction for October.
- US State Employment and Unemployment for October.
November 20, Wednesday:
- US EIA Weekly Petroleum Status Report for Nov 15 week.
November 21, Thursday:
- US Unemployment Insurance Weekly Claims Report for Nov 16 week.
- US Weekly Export Sales.
- US Existing Home Sales for October.
- US Advance Quarterly Services for Q3.
November 22, Friday:
- US Flash Manufacturing PMI for November.
- US Flash Services PMI for November.
- India HSBC Composite PMI for November.
- India HSBC Manufacturing PMI for November.
- India HSBC Services PMI for November.
- India FX Reserves for Nov 11 week
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