USDINR opened at 75.27 y’day and the pair traded in the 75.27-75.50 range. Spot USDINR closed at 75.46 , loss of 4 ps for USD as against prior close of 75.50. RBI reference rate was fixed at 75.38 y’day. May USD/INR closed at 75.41, gain of 3 ps for USD as compared to prior day’s close of 75.38. May Euro/INR closed at 81.94, GBP/INR at 92.86 and Yen/INR at 70.48.
FII’S have nett bought Rs 15864 Cr of Indian Equities in May . This is due to block deal in HUL shares through book buiding process. FII’S have nett sold Rs 541 Cr of Indian debt securities in May. In FY 19-20, FII’s have sold Rs 10200 Cr of Equities and 47393 cr of debt.
Benchmark Nifty climbed 2.03% y’day. DOW declined 516 points (2.17%) y’day. Nikkei declined 0.49% and Hang seng declined 0.27% y’day.
Euro is now at 1.0812,Pound at 1.2216,Yen at 106.86.
Commodities: Gold is now at USD 1720 and WT1Crude at USD 25.25/Brent at USD 29.
Interest rates: USD 10 Yr yield is at 0.636% and 3 m libor closed at 0.44%. Indian 10 yr benchmark yield closed at 6.16%.
Economic news: FM announced following measures in Part 1 of the stimulus detailing: 1) 4 year Collateral free loan of Rs 3 lac Cr to MSME’s. 2) Investment limit enhanced and turnover limit is also a new norm for MSME’S. 3) PEC/RFC will infuse Rs 90,000 cr to discoms against their receivables, 4) Govt will pay 12% employers and employees contribution for another 3 months for companies employing less than 100 and salary below Rs 15,000 for another 3 months, 5) EPF contribution by private employees and employers reduced to 10% for 3 months, 6) Govt will buy Rs 30000 cr debt papers of NBFC irrespective of rating and 20% partial guarantee for another tranche of Rs 45,000 Cr of NBFC debt
7) TDS and TCS reduced by 25% to infuse more liquidity, 8) Govt PSU’S will clear all payables to suppliers, 9) Fund of funds to infuse Rs 50,000 Cr equity into MSME’S, 10) Rs 20,000 Cr subordinate debt for stressed MSME’S 10) Extenison of real estate projects and Govt contracts, 11) Deferral of tax return and audit.
Fed Chairman warned of a “significantly worse” U.S. recession than any downturn since World War Two because of coronavirus pandemic fallout, but ruled out negative interest rates.
Data highlights : US PPI declined -1.3% m/m.
-EU industrial production declined -11.3% m/m.
-UK GDP declined -2% q/q , Manufacturing and industrial production declined -4.6% m/m and -4.2% m/m respectively.
Thursday’s calendar:- US Weekly jobless claims
Daily Support/Resistance table
MAJOR SUPPORTS/RESISTANCES AND TREND TABLE
Technicals: Spot closed above 200 day moving average. 20 day moving average is at 76.05. 50 day moving average is at 74.90.200 day moving average is at 71.66. Daily MACD is in sell zone, implying top at 76.90. Important support is at 74.90/74.40. Spot closed below its average level of the day.
Intra day supports and resistances for May contract are:
PP:75.38 ,S1:75.15, S2:74.88, R1:75.64, R2: 75.88
Hedging strategy for USD/INR: Hedging decisions be taken according to comfort and accounting rates.
CROSS CURRENCY TECHNICALS:
EURO/USD: The pair is below 200 day major moving average. Next Major resistance is at 1.1050 and later at 1.1150. Major support is at 1.0725 and later at 1.0650. Daily MACD is in buy zone, implying an important bottom at 1.0725. Weekly MACD is in sell zone, implying important top at 1.15.
GBP/USD: The pair has turned sideways and is between major moving averages.Daily MACD is in sell zone, implying important top at 1.2650 and weekly MACD is in sell zone, implying important top at 1.3515. Important resistance is at 1.2650/1.2820. Important support is at 1.2245 and later at 1.2165.
USD/YEN: The pair is below major moving averages. Daily MACD is in sell zone, implying important top at 109.40. Next important resistance is at 111.75. Important support is at 106/105.10.