Highlights

  • US Retail Sales increased by 0.4 percent in the last month.
  • German PPI declined by 0.2 percent in the month of October.
  • China’s HSBC Manufacturing PMI fell to 50.4-mark in November.

Asian markets are trading on a mixed note today after US Federal Reserve minutes yesterday signaled that QE tapering is possible in the coming months coupled with more than expected decline in China’s manufacturing data.

China’s HSBC Flash Manufacturing Purchasing Managers’ Index (PMI) declined by 0.5 points to 50.4-mark in November as against a rise of 50.9-level in October.

US Dollar Index

The US Dollar Index (DX) gained around 0.5 percent yesterday on the back of rise in risk aversion in market sentiments which led to rise in demand for low yielding currency. Further, expectations of QE tapering by the Federal Reserve in near term meetings exerted downside pressure on the currency. The DX touched an intra-day high of 81.20 and closed at 81.17 on Wednesday.

US Core Consumer Price Index (CPI) remained unchanged at 0.1 percent in October. Core Retail Sales gained by 0.2 percent in October from earlier rise of 0.3 percent in September. Retail Sales increased by 0.4 percent in the last month. Consumer Price Index (CPI) declined by 0.1 percent in October with respect to rise of 0.2 percent a month ago. Existing Home Sales rose by 5.12 million in October when compared to 5.29 million in September.

Dollar/INR

The Indian Rupee depreciated around 0.3 percent yesterday’s trading session and fell after straight four days of gains. The currency depreciated on the back of dollar demand from corporate and oil refiners. Further, strength in the DX in early part of the trade exerted downside pressure on the currency. Additionally, weak domestic market sentiments acted as a negative factor.

 

Additionally, selling of dollars by state run banks in later part of the trade along with rising inflow of foreign funds could not provide respite to depreciation in the Indian Rupee. The currency touched an intra-day low of 62.68 and closed at 62.57 on Wednesday.

For the month of November 2013, FII inflows totaled at Rs.7460.40 crores ($1195.97 million) as on 20th November 2013. Year to date basis, net capital inflows stood at Rs.96394.10 crores ($17394.90 million) till 20th November 2013.

Outlook

From the intra-day perspective, we expect Indian Rupee to trade on a negative note on the back of weak market sentiments coupled with strength in the DX. Further, dollar demand from corporate and oil firms will exert downside pressure on the currency. However, sharp downside will be prevented due to rising inflow of foreign funds and selling of dollars by state run banks.

Technical Outlook valid for November 21, 2013 Trend Support Resistance US Dollar/INR Nov’13 (NSE/MCX-SX) Up 62.40/62.30 62.80/63.0

Euro/INR

The Euro depreciated around 0.7 percent yesterday on the back of strength in the DX. Further, weak market sentiments exerted downside pressure on the currency.

Additionally, unfavorable economic data from the region acted as a negative factor. The Euro touched an intra-day low of 1.3415 and closed at 1.3438 on Wednesday.

German Producer Price Index (PPI) declined by 0.2 percent in October as against a rise of 0.3 percent in September.

Outlook

In today’s session, we expect Euro to trade lower on account of weak market sentiments along with stronger DX. Further, expectations of mixed manufacturing data from the region will exert downside pressure in the currency.

Technical Outlook valid for November 21, 2013

Trend Support Resistance Euro/INR Nov’13 (NSE/MCX-SX) Up 84.50/84.30 84.90/85.10

GBP/INR

The Sterling Pound dropped around 0.1 percent yesterday on account of stronger DX. Further, weak market sentiments added downside pressure in the currency.

The Pound touched an intra-day low of 1.6086 and closed at 1.6104 on Wednesday.

Outlook

From the intra-day perspective, we expect Pound to trade on a negative note on account of weak market sentiments. Additionally, a stronger DX will also act as a negative factor for the Sterling Pound. Further, expectations of decline in UK’s industrial orders data will add downside pressure in the currency.

Technical Outlook valid for November 20, 2013 Trend Support Resistance GBP/INR Nov’13 (NSE/MCX-SX) Up 100.90/100.70 101.30/101.50

JPY/INR

The Japanese Yen appreciated by 0.1 percent yesterday on the back of weak global market sentiments that led to a rise in demand for the low yielding currency. The Yen touched an intra-day high of 99.77 and closed at 100.0 on Wednesday.

Outlook

Appreciation in the Yen is expected in today’s trade as a result of rise in risk aversion in market sentiments which will lead to rise in demand for the low yielding currency.

Technical Outlook valid for November 21, 2013 Trend Support Resistance JPY/INR Nov’13 (NSE/MCX-SX) Up 62.50/62.40 62.90/63.10

 

[Source: angel broking]

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