After an eight-month low, growth in India's manufacturing sector resumed in the third quarter of the current fiscal year as output increased, led by quicker rises in total new orders and international sales, according to a private industry survey published Monday. The final HSBC India manufacturing Purchasing Managers' Index (PMI), which is put together by S&P Global, went up from 56.5 in September to 57.5 in October. This was after falling to a low point of 56.5 in August. A number above 50 in the measure means that activity is growing, while a number below 50 means that activity is decreasing.
Top 3 Leads Today
- India Inc sends mixed signals on H2 FY25 capital expenditure path.
- IMF suggests RBI to expand financial stability unit workforce.
- Search begins for new RBI deputy governor as applications invited by Nov 30.
Indian Markets
- Money Markets Minute: The rate settled below the RBI’s standing deposit facility rate of 6.25% as banks continued to experience low demand for funds, benefiting from ample liquidity in the system. The one-day call money rate closed at 5.75%, unchanged from the previous four-day rate on Thursday. Meanwhile, the weighted average call rate was 6.41%, down from 6.54% on Thursday.
- Government Bond Brief: Yields fell as traders covered short positions, influenced by a significant drop in US Treasury yields during European trading hours. The 10-year benchmark 7.10%, 2034 bond yield closed at 6.83%, down from 6.85% on Thursday, with a market turnover rose to ₹277.65 billion from ₹204.90 billion on Thursday.
- Corporate Bond Beat: Corporate bond yields in the secondary market held steady across tenures as investors avoided large trades ahead of the US presidential election on Tuesday. Trading activity recorded deals worth ₹100.04 billion, from ₹36.14 billion on Thursday.
- Forex Flash: The rupee ended at a record low against the dollar, pressured by persistent dollar buying from banks acting on behalf of foreign portfolio investors withdrawing funds from Indian equities. The currency moved within a narrow range of just 6 paise and closed at 84.1150 per dollar. On Thursday, the rupee had inched up by 1 paisa to settle at 84.07 against the dollar.
- Stocks Spotlight: Caution ahead of the US presidential election drove benchmark indices down to near three-month lows, as investors remained wary about the election outcome's impact on U.S. monetary policy. Concerns over potential shifts in the Federal Reserve's policy weighed on sentiment, leading to a sharp fall in the markets. The Nifty 50 closed 1.3% down at 23,995.35 points, while the Sensex ended down 1.2% at 78,782.24 points.
International Markets
- US Stocks: The benchmark indices closed slightly lower following a tumultuous session on Monday, as investors braced for a critical week in which Americans will elect a new president, and the Federal Reserve will release its policy statement. The Dow Jones Industrial Average dropped 0.61% to 41,794.60, the S&P 500 sank 0.28% to 5,712.69, and the Nasdaq Composite slid 0.33% to 18,179.98.
- Treasuries: Yields fell broadly following a poll indicating that Democratic candidate Kamala Harris and Republican candidate Donald Trump are nearly equal in opinion polls prior to Tuesday's election. The yield on the benchmark US 10-year note declined by 6.8 basis points to 4.2948%, while the two-year note endured its first decline in six days, falling by 3.2 basis points to 4.1723%.
- Currency: The dollar fell on Monday as investors exited Trump trades, which have benefitted in recent weeks from speculation that Republican former President Donald Trump is more likely to win the presidency on Tuesday. The dollar weakened against several European and Asian currencies, sliding 0.38% against the euro to $1.087 and 0.5% against the Japanese yen to 152.17. The dollar index was down 0.05%, to 103.89.
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 | 3840 | 150 | 105 | 0 | - |
| NBFC | 397 | 1568 | 411 | 116 | 25 |
| Telecom | - | 1325 | 75 | 10 | - |
| Housing Finance Company | - | 111 | 263 | 1 | - |
| Public Sector Bank | - | - | - | 100 | - |
Secondary trade details for recently issued primary corporate bonds:
Security Name |
Issue Date |
Trades Since Issue(Cr) |
Avg Yield(%) |
LTY (%) |
|---|---|---|---|---|
| 7.98 SBI PERP 24OCT34 C | 2024-10-24 | 1203 | 7.97 | 7.97 |
| 8.96 SHRIRAM FINANCE 24OCT27 | 2024-10-24 | 360 | 8.96 | 8.96 |
| 7.43 JUPL 24OCT34 | 2024-10-24 | 260 | 7.43 | 7.42 |
| 7.05 INDIAN BANK 25OCT34 | 2024-10-25 | 230 | 7.14 | 7.12 |
| 9.75 SAMMAAN CAPITAL LIMITED 20OCT2029 | 2024-10-21 | 220 | 10.19 | 10.52 |
| 7.8750 NIIF 28NOV30 | 2024-10-24 | 155 | 7.87 | 7.87 |
| - SURYAPET KHAMMAM ROAD PRIVATE LIMITED - CALL 30JUN2031 MAT | 2024-10-24 | 81 | 8.59 | 9.45 |
| - SURYAPET KHAMMAM ROAD PRIVATE LIMITED - CALL 30JUN2035 MAT | 2024-10-24 | 54 | 8.24 | 8.24 |
| 7.72 ICICI HOME FINANCE 28SEP29 | 2024-10-25 | 50 | 7.72 | 7.72 |
Source: Harmoney data analytics
Events This Week
November 5, Tuesday:
- US International trade in goods & services for September.
- US Services PMI for October.
- US Presidential Election.
November 6, Wednesday:
- US Global services PMI for October.
- US FOMC meeting.
- India Services and composite PMI for October.
November 7, Thursday:
- US Unemployment insurance weekly claims report for Nov 2 week.
- US Weekly export sales.
- US Monthly wholesale trade for September.
- US Interest rate decision.
November 8, Friday:
- India FX Reserves for Nov 1 week.
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