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Market Roundup

Indian rupee stabilised in the week, ending 8 paise higher to 83.38 a dollar.

The RBI has held the rate unchanged for the eighth consecutive meeting, withdrawal of the accommodative stance. However, it has raised the country’s growth prospects amid a better macro environment.

Spot USDINR is expected to trade in the broad range of 83.10 to 83.60 in the coming day. The bias remains neutral to positive as long as it trades above 83. The dollar and equities are set for heightened volatility driven by the release of US inflation data and the Federal Reserve’s policy meeting.

The Federal Reserve and Bank of Japan meet this week. While both are seen leaving interest rates on hold, there will be close attention paid to any clues to the likely path of policy going forward.

Markets in China, Hong Kong and Australia were closed Monday for holidays.

Forex:

* Japanese shares opened higher thanks to robust economic data, while the euro fell to its weakest in nearly a month after French President Emmanuel Macron and German Chancellor Olaf Scholz suffered defeats in the European Parliament elections.

* A measure of greenback strength rose to a one-month high, gaining for a third straight week, after US payroll additions in May topped all estimates with wage growth exceeding expectations, prompting forecasters to push out the timeline for Fed cuts.

* Swaps traders lower odds of a September rate cut to 45% from 76% before the US jobs report, according to data compiled by Bloomberg.

Equities:

* Asian equities traded mixed after a weak handover by the US equities. India’s stocks may gain traction now that election-related uncertainties have subsided. Prime Minister Narendra Modi has officially been sworn in for his third term.

Commodities:

* In commodities, Oil steadied after a weekly drop with the market still digesting OPEC+’s decision to restore supply, as traders look ahead to a set of industry reports. Gold traded near $2,300 an ounce after plunging 3.5% on Friday as surprise strength in a US jobs report dashed hopes the Fed will be able to start lowering borrowing costs soon

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