market update july2011
TRANSCRIPT
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MCX Stock Exchange Limited
Number of Members 743
Turnover (`in crs)
Average daily 19,443
Total 408,313
Volume (in lots)
Average daily 4,208,972
Total 88,388,424
Market share (%) 38.43
Exchange Statistics
In this Issue.
Global Market Connect
Currency Movements
Global Indices
First Quarter Review 2011-12
Exchange Corner
Regulatory Updates
MCX-SX Circulars
Data CornerIndia
Economic Calendar
Economic News
2
3
4
5
6
8
9
10
11
13
Mail box
Appreciate your feedback at
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Top ^
CRB Index has risen by 1.59% from a closing
value of 336 on July 01, 2011 to a closing value of
342 on July 29, 2011.
Dow Jones Index has fallen by 3.49% from a
closing value of 12582.77 on July 01, 2011 to a
closing value of 12143.24 on July 29, 2011.
Gold has risen by 9.54% from a closing value of
$1484.50 on July 01, 2011 to a closing value of
$1626.14 on July 29, 2011.
Crude Oil has risen by 0.80% from a closing
value of 94.94 on July 01, 2011 to a closing value
of 95.70 on July 29, 2011.
Global Market Connect
US Dollar Index fell by 0.81%
from a closing value of 74.349 on
July 01, 2011 to a closing value of
73.745 on July 29, 2011.
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US Dollar index has weakened during July 2011
Weightage
to the Index
Month- July 2011Percentage
change
Dollar
Strength/weak
Previous Month
(June 2011)
Dollar Strength
/WeaknessJuly 01,
Close
July 31,
Close
Euro 57.6% 1.4522 1.4395 -0.87 Strength Weak
Japanese Yen 13.6% 80.83 76.73 -5.07 Weak WeakPound Sterling 11.9% 1.6074 1.6418 2.14 Weak StrengthCanadian Dollar 9.1% 0.9585 0.9551 -0.35 Weak WeakSwedish Krona 4.2% 6.2650 6.2656 0.01 Strength StrengthSwiss Franc 3.6% 0.8476 0.7852 -7.36 Weak Weak
EURO has depreciated by 0.87% against Dollar
from a closing value of $1.4522 on July 01, 2011to a closing value of $1.4395 on July 29, 2011.
The British pound has appreciated by 2.14%
against the Dollar from a closing value of $1.6074on July 01, 2011 to a closing value of $1.6418 on
July 29, 2011.
The Japanese Yen has appreciated by 5.07%
against the Dollar from a closing value of 80.83
Yen on July 01, 2011 to a closing value of 76.73
Yen on July 29, 2011.
The US Dollar weakened the most against Japanese Yen, depreciating about 5.07%. However the Dollar index
strengthened the most against Euro, appreciating about 0.87%.
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Currency Movements
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NIKKEI has fallen by 0.36% from a closing value
of 9868 on July 01, 2011 to a closing value of
9833 on July 29, 2011.
NASDAQ has risen by 0.06% from a closing
value of 2361 on July 01, 2011 to a closing value
of 2362 on July 29, 2011.
HANGSENG has fallen by 1.45% from a closingvalue of 22770 on July 04, 2011 to a closing value
of 22440 on July 29, 2011.
Global Indices
SENSEX has fallen by 3.01% from a closing
value of 18762 on July 01, 2011 to a closing
value of 18197 on July 29, 2011.
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On the global front, the sovereign debt problems that have beset the euro area over the past year now threaten larger
economies in the region. There is heightened anxiety about whether the euro area will be able to agree on aneconomically viable, fiscally sustainable and politically feasible solution to the vexing sovereign debt problem. In this
regard, the agreement reached by the euro zone leaders in their meeting on July 21, 2011 is a positive development. In
the US, concerns over a sovereign default loom over financial markets, with potentially disruptive consequences for
global capital flows. Despite sluggish economic activity, inflationary pressures also emerged in advanced economies
under the impact of high commodity prices. In striking contrast to advanced economies, emerging market economies
(EMEs) are generally dealing with rising inflation, caused by a combination of elevated commodity prices and robust
domestic demand.
From the perspective of India's macroeconomic policy imperatives, a critical consideration is the effect that global
conditions will have on commodity prices. After the May 3 Policy Statement, the prices of many commodities,
including that of crude oil, showed signs of softening, reflecting weakening demand in advanced economies.
However, one quarter later, the downtrend has not yet proved to be very strong. Prices are generally still high
compared with last year. Turning to the domestic economy, output expanded by 8.5% during 2010-11. The index of
industrial production (IIP) suggested that earlier signals of a growth deceleration in the second half of last year were
exaggerated. In fact, the growth momentum remained strong throughout last year.
Inflation continues to be the dominant macroeconomic concern. The headline WPI inflation rate for the first quarter
of this fiscal year remained stubbornly close to double digits and inflationary pressures continued to be broad-based.
Non-food manufactured product inflation ruled above 7% in the first quarter suggesting that producers, operating at
high levels of capacity utilisation, are able to pass on rising commodity input prices and wage costs to consumers. As
stated in the First Quarter Review of Monetary Policy 2011-12 released on July 26, 2011, the baseline projection for
WPI inflation for March 2012, as indicated in the May 3 policy statement, was 6.0% with an upward bias. However
keeping in view the domestic demand-supply balance, global trends in commodity prices and the likely demand
scenario, we have revised the baseline projection for WPI inflation for March 2012 upward to 7%.
Risks to the indicative projections of growth and inflation for 2011-12 are:
Uncertainty about the future path of global commodity prices, especially oil Uncertainty about capital flows from the perspective of financing the current account deficit Risks to food inflation stemming from the monsoon performance, higher minimum support prices and
inadequate supply response pertaining to protein-rich items
Significant upside risks to the projected fiscal deficit for 2011-12 as fiscal deficit has been a key source ofdemand pressures.
Based on an assessment of the current macroeconomic situation, following has been affected:
Increase the policy repo rate under the liquidity adjustment facility (LAF) by 50 basis points. The repo ratewill move up from 7.5% to 8.0%.
Consequently, the reverse repo rate under the LAF, determined with a spread of 100 basis point below therepo rate, automatically adjusts to 7%. Similarly, the Marginal Standing Facility (MSF) rate, determined with
a spread of 100 bps above the repo rate, stands recalibrated at 9.0%.
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Macroeconomic & Monetary Developments: First Quarter Review 2011-12
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The Rupee depreciated against the GBP, with the
close price of GBPINR for July 2011 moving from`71.7050 to `72.3400 during the period,
experiencing an high of `72.5575 and a low of
`70.9475.
The Rupee depreciated against the JPY, with the
close price of JPYINR for July 2011 moving from
`55.4250 to `57.1975 during the period,
experiencing an high of `57.1975 and a low of
`54.6550.
The Rupee appreciated against the Dollar, with
the close price of USDINR for July 2011 movingfrom `44.7700 to `44.4325 during the period,
experiencing an high of `44.8250 and a low of
`44.1900.
The Rupee appreciated against the EURO, with
the close price of EURINR for July 2011 moving
from `64.7925 to `63.3200 during the period,
experiencing an high of `64.7925 and a low of
`62.4125.
During July 2011, the market share of the Exchange stood at 38.43% in the Currency Futures market. The
average traded daily turnover in MCX-SX was`19443.52 crores with average daily contracts of 4,208,972.
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Exchange Corner
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Market share across all Currency Futures
Daily Contract-wise distribution of Turnover
In USDINR, the trading depth is seen across contracts other than 1 st month with the percentage
turnover ranging between 2.59% to 20.48%.
In the other currency pairs i.e EURINR, GBPINR and JPYINR, it is observed that trading is seen
beyond 1st month expiry period.
Exchange Corner
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Allocation of Government debt long term limits toFIIs
Ref No: CIR/IMD/FIIC/11/2011 dated July 29, 2011
atwww.sebi.gov.in
First Quarter Review of Monetary Policy 2011-12:
Press Statement by Dr. D. Subbarao, Governor.
Press Release: 2011-2012/133 dated July 26, 2011
Macroeconomic and Monetary Developments:
First Quarter Review 2011-12
Press Release: 2011-2012/129 dated July 25, 2011 atwww.rbi.org.in
Establishment of Connectivity with both
depositories NSDL and CDSL Companies eligible
for shifting from Trade for Trade Settlement (TFTS)
to normal Rolling Settlement
Ref No: CIR/MRD/DP/ 10 /2011 dated July 18, 2011
atwww.sebi.gov.in
Regularisation of Liaison Offices / Branch Offices
of foreign entities established in India during the
pre-FEMA regime
Press Release: 2011-2012/86 dated July 15, 2011 at
www.rbi.org.in
Clarification regarding admission of Limited
Liability Partnerships as members of Stock
Exchanges.
Ref No: CIR/MIRSD/12/2011 dated July 11, 2011 at
www.sebi.gov.in
RBI Releases Draft Guidelines on Equity
Investments by scheduled commercial banks insubsidiaries and other companies
Press Release: 2011-2012/32 dated July 6, 2011 at
www.rbi.org.in
It has been decided that the Stock Exchanges may
allow modifications of client codes of non-institutional
trades only to rectify a genuine error in entry of client
code at the time of placing / modifying the related
order.
Modification of Client Codes of Non-institutional
Trades Executed on Stock Exchanges (All
Segments)
Ref No: CIR/DNPD/6/2011 dated July 05, 2011 at
www.sebi.gov.in
Facilitating Rupee Trade Hedging Facilities for
Non-resident Entities
Press Release: 2011-2012/115 dated July 21, 2011 at
www.rbi.org.in
Issued guidelines allowing non-resident importers and
exporters to hedge their currency risk in respect of
exports from and imports to India, invoiced in Indian
Rupees, with AD Category I banks in India. The guidelines have been finalised in consultation with the
Foreign Exchange Dealers Association of India (FEDAI)
and market participants.
Regulatory Updates
http://www.sebi.gov.in/http://www.sebi.gov.in/http://www.sebi.gov.in/http://www.sebi.gov.in/http://www.sebi.gov.in/http://www.sebi.gov.in/http://www.sebi.gov.in/http://www.sebi.gov.in/ -
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Settlement Schedule for August 2011Ref No: MCX-SX/C&S/601/2011dated July 12, 2011
List of Government of India Securities, Treasury Bills, Equity Shares and
Exchange Traded Funds accepted as Collaterals.Ref No: MCX-SX/C&S/595/2011 dated July 01, 2011
Modification of Client Codes of Non-Institutional TradesRef No: MCX-SX/ID/613/2011 dated July 29, 2011
Change of Expiry TimingRef No: MCX-SX/TRD/610/2011 dated July 22, 2011
Revision in maximum compensation limit to single investor from Investor
Protection FundRef No: MCX-SX/LEGAL/607/2011 dated July 20, 2011
FATF public statement dated June 24, 2011 against FATF identified
jurisdictions that have strategic AML/CFT deficiencies.Ref No: MCX-SX/ID/603/2011 dated July 15, 2011
Self Clearing Member in Currency Derivatives SegmentRef No: MCX-SX/C&S/602/2011 dated July 14, 2011
Smart Order Routing (SOR) List of System AuditorsRef No: MCX-SX/CTCL/612/2011 dated July 29, 2011
Review of Internet Based Trading (IBT) and Securities Trading using
Wireless TechnologyRef No: MCX-SX/CTCL/596/2011 dated July 05, 2011
RSA Hardware Tokens for Internet TradingRef No: MCX-SX/IT/594/2011 dated July 01, 2011
MCX-SX Circulars
Regular Updates
Market Regulation
Technology
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Economic DataDate Event Percentage
Change
Exports -
June 2011
May 2011
US $29.21bn
US $25.94bn
12.61%
Imports -
June 2011
May 2011
US $36.87bn
US $40.90bn
-9.85%
International reserves as on July 22, 2011 US$316.80bnPolicy Rates
Bank Rate 6.00%
Repo Rate 8.00%Reverse Repo Rate 7.00%
Lending/Deposit Rates
Base Rate 9.25% - 10.25%
Savings Bank Rate 4.00%
Deposit Rate 8.25% - 9.10%
Economic Calendar August 2011Monday Tuesday Wednesday Thursday Friday
1 2 3 4 5Foreign merchandise
trade Exports/Imports
FX reserve
8 9 10 11 12
OECD composite
leading indicator for
India
FX reserve
IIP
15 16 17 18 19
WPI Inflation FX reserve
CPI Agricultural/Rural
Labourers
22 23 24 25 26
Output of Crude
oil/ Refinery/
Natural gas
IIP Core
FX reserve
29 30 31
GDP
CPI-Industrial
Workers
Data Corner - India
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August - 2011
Monday Tuesday Wednesday Thursday Friday1 2 3 4 5
EMU: PMI Mfg Index
EMU: Unemployment
Rate
US: ISM Mfg Index
EMU: PPI EMU: Retail Sales
US: ISM Non-Mfg
Index
JP: BoJ
Announcement
GB: BOE
Announcement
EMU:ECB
Announcement
GB: Producer Price
Index
US: Employment
Situation
CA: Ivey Purchasing
Managers' Index
8 9 10 11 12
GB: Industrial
Production
US: FOMC Meeting
JP: Tertiary Index
US: Trade Balance EMU: Industrial
Prodn
US: Retail Sales
15 16 17 18 19
EMU: GDP
CA: Mfg Sales
US: Housing Starts
US: Import and
Export Prices
US: Industrial Prodn
EMU:HICP
US: Producer Price
Index
US: Consumer
Price Index
CA: CPI
22 23 24 25 26
CA: Retail Sales US: Durable Goods
Orders
JP: CPI
US: GDP
29 30 31
JP: Unemployment
Rate
CA:IPPI
US: FOMC Minutes
JP: Industrial Prodn
EMU: Unemployment
Rate
CA: Monthly GDP
Economic Calendar
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Back ^
September - 2011Monday Tuesday Wednesday Thursday Friday
1 2
EMU:PMI Mfg
Index
US:ISM Mfg Index
EMU:PPI
US: Employment Situatn
5 6 7 8 9
EMU: Retail Sales JP: BoJ
Announcement
EMU: GDP
US: ISM Non-MfgIndex
CA: BoC
Announcement
US: Beige Book
GB: BOE
Announcement
EMU: ECBAnnouncement
CA: Merchandise
Trade
UK: Trade Balance
12 13 14 15 16
US: Import and
Export Prices
EMU: Industrial
Prodn
US: Producer Price
Index
US: Retail Sales
EMU:HICP
CA: Mfg Sales
US: Consumer
Price Index
US: Industrial
Prodn
US: Industrial Production
19 20 21 22 23
US: Housing
Starts
US: FOMC Meeting
CA: CPI
CA: Retail Sales
26 27 28 29 30
US: Durable Goods CA: IPPI
US: GDP
JP: Unemployment Rate
JP: CPI
JP: Industrial Production
EMU: Unemployment
Rate
CA: Monthly GDP
Economic Calendar
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Economic News July 2011
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Economic News July 2011
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