Published on 8/07/2020 12:32:09 PM | Source: ICICI Direct

The dollar-rupee contract on the NSE was at 75.06 in the last session - ICICI Direct

Posted in Currency Report| #Currency Tips #ICICI Direct

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Forex and global equities

Spot Currency

* After appreciating for a long time, the rupee tumbled nearly 25 paise and closed at 74.95 levels despite the Dollar index remaining under pressure. We continue to feel the US$INR pair could remain in a range for a couple of sessions

* The Dollar index continued to remain under pressure below 97 levels as questions on the effect of pandemic on the US economy rises. JOLTs Job Openings, IBD/TIPP index and API report could be the trigger for the index

Global Bonds

* Post a flat opening, in the early hours, energy stocks witnessed selling pressure while the Nifty made a low of 10690. However, a late recovery in BFSI along with outperformance in midcap & auto stocks helped the market to recover the intraday losses

* On Tuesday, the Bank Nifty relatively outperformed the Nifty. The index rose almost 1.5% whereas private banks were the leader and midcap banks also witnessed short covering. Looking at the addition in OTM and ATM Put, we feel upsides will continue

FII Activity

* Foreign institutional investors (FII) were net buyers to the tune of | 1255 crore on July 3, 2020. They bought | 481 crore in the equity market and | 774 crore in the debt market. FIIs have bought close to | 2225 crore in equities in the July series as of now


INR futures and Outlook

Currency futures on NSE

* Short covering was seen in the last session due to which the rupee weakened by 25 paise. However, we feel it could consolidate in a range in coming days

* The dollar-rupee contract on the NSE was at 75.06 in the last session. The open interest fell almost 4.2% in the last session


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