Friday, October 7

ECONOMIC NEWS

ECONOMIC NEWS

Oil Heads For Fourth Straight Monthly Loss as OPEC Meeting Looms

Oil prices rose slightly on Friday, but were set for a fourth straight month of losses amid growing concerns over weakening demand, with the focus now turning to a potential supply cut by the OPEC next week. London-traded Brent oil futures, the global benchmark,  were flat at $87.50 a barrel by 21:55 ET (01:55 GMT), while U.S West Texas Intermediate curse futures rose 0.4% to $81.56 a barrel. Both contracts were set to lose about 9% in September. Prices took mixed signals from Chinese manufacturing data on Friday. While the Official Government Reading showed that activity expanded in September, a Private survey showed that activity sank far more than expected. Oil prices tumbled from annual highs this year amid growing concerns that rising interest rates will crimp economic activity...
ECONOMIC NEWS

Asian Stocks Slammed by Fed Rate Hike Risks

Asian stock markets sank on Wednesday, tracking overnight losses on Wall Street as investors awaited an interest rate hike and more hawkish signals from the Federal Reserve. Hong Kong’s technology-heavy Hang Seng index continued to lag behind its peers, falling 1.5%, while Japan’s Nikkei index lost 1.3%. The day’s losses also negated a soft rebound seen earlier this week. Market focus was squarely on the Federal Reserve, which is expected to hike interest rates by at least 7.5 basis points (BPS) at the conclusion of a two-day meeting later in the day. Markets are also pricing in the possibility of a 100bps. hike,  following hotter-than-expected U.S. inflation readings last week. Asian stocks took a weak lead-in from Wall Street indexes, which plummeted as much as 1%  amid increasi...
ECONOMIC NEWS

Dow Futures Tick Higher After Indices Post Their Worst Week Since June

U.S. stock futures were trading slightly higher during Sunday’s evening deals, after major benchmark indices posted their greatest weekly losses in 3 months, with investors remaining cautious amid persistent inflation fears ahead of Federal Reserve’s two-day meeting and rate decision later this week. By 7:10pm ET (11:10pm GMT) Dow Jonas Futures and S&P 500 Futures  were up 0.2% apiece, while  Nasdaq 100 Futures were flat at 11,862.7. Ahead of  the week, market participants will be closely focused on the Federal Reserve’s interest rate decision following a hotter-than-expected CPI reading boosted expectations for a third consecutive 0.75% rate hike, lifting Fed Funds rate  to a target range of 3% to 3.25%. Investors will also be monitoring building permits  and existing home sa...
ECONOMIC NEWS

Oil prices and financial markets brace for recession

U.S. economic data remains strong but a range of financial indicators point to a sharp slowdown over the next year that would dampen oil consumption and lead to lower prices. The apparent contradiction between the real economy and financial markets has puzzled some commentators but is normal around a peak in the business cycle. Economic data reflect current conditions while financial prices reflect how traders expect the economy to evolve in future. By definition, every downturn starts from a peak in the business cycle when activity is strong. The rapid shift from strong and rising economic activity into a contraction is what makes turning points hard to predict. U.S. freight volumes were at record levels in June and manufacturing output was close to its highest levels since be...
ECONOMIC NEWS

Japan set to waive some visa requirements in October to boost tourism

Japan is expected to waive visa requirements for certain tourists and remove a limit on daily arrivals in October as it aims to benefit from a rebound in global tourism, Nikkei reported on Thursday. Following the change, Japan will not require visas for short-term travelers from the United States and certain other countries and will scrap the daily entry cap of 50,000 people, the media outlet said. Japanese Prime Minister Fumio Kishida expected to announce the changes in the country days, the report said With the yen languishing near a 24-year low against the dollar, owing to a hawkish U.S. Federal Reserve, the Japanese government could benefit from capitalising on the increased buying power of tourists by easing travel requirements, the report added. Japan last w...
ECONOMIC NEWS

Foreign investors snap up Indian bonds set for inclusion in global indexes

Foreign investors have stepped up purchases in a clutch of Indian government bonds that have no limits on foreign investments ahead of an anticipated inclusion of Indian debt in global bond indexes, analysts said. The central bank removed foreign investment caps for a number of securities under the ‘fully accessible route’  in April 2020 to help meet a key requirement of index providers. “As far as the inclusion goes, the bonds under FAR will be a part of the index as there are no restrictions in that segment,” Ashish Agrawal, Asia head of foreign exchange and emerging market macro strategy research at Barclays said. “If they are the ones that would be included, we can expect a premium to build between the FAR bonds and other Indian government bonds,” Agraw...
WPI inflation rises to 8-month high of 1.48% on pharma, metal prices
ECONOMIC NEWS

WPI inflation rises to 8-month high of 1.48% on pharma, metal prices

By Administrator _India Capital Sands The wholesale price index-based (WPI-based) inflation rate rose for the third straight month to an eight-month high of 1.48 per cent in October from 1.32 per cent in the previous month. Economists said the WPI data enforced the case for the status quo in the Reserve Bank of India’s policy rates. Unlike its consumer price index (CPI) counterpart, pressure did not come from food items in general. These were manufactured products, particularly pharma and metals, that fuelled the WPI inflation rate. Economists attributed it to a rise in demand due to festivals and after unlockdown was announced for more sectors from September onwards. The food inflation rate in the WPI came down to 6.37 per cent in October from 8.17 per cent in the pre...
Pound Falls on Lockdown, Brexit Fears
ECONOMIC NEWS

Pound Falls on Lockdown, Brexit Fears

By Administrator_ India Capital Sands The pound fell sharply Tuesday as concerns about a no-deal Brexit and fears over a looming lockdown hurt sentiment. GBP/USD fell 0.95% to $1.2940. The possibility of the UK leaving the EU without a trade deal is a "credible hypothesis," French foreign minister Jean-Yves Le Drian reportedly said Tuesday, according to media reports. The stark warning that a hard Brexit could be in the offing when the transition period ends on Dec. 31 comes as the French government appears reluctant to give in to UK demands over control of its fisheries. The uncertainty over deal comes just days ahead of the Oct. 15-16 European summit, during which EU Brexit negotiator will provide an update on Brexit negotiations. The pound was also hurt by fears t...
India’s services activity contracted for fifth straight month in July – PMI
ECONOMIC NEWS

India’s services activity contracted for fifth straight month in July – PMI

By Administrator_India Capital Sands India’s dominant services industry, a key driver of economic growth, shrank for a fifth straight month in July as restraining measures to stop the spread of the coronavirus hurt business activity and led to record job cuts, a survey showed. India has recorded the third highest number of coronavirus cases globally, behind only the United States and Brazil, with over 1.8 million confirmed infections and more than 38,000 deaths, according to a Reuters tally. That has forced state and central governments to impose strict lockdown measures to curb the spread of the virus, keeping people at home and businesses closed, stifling demand and cementing fears of a deep recession. The Nikkei/IHS Services Purchasing Managers’ Index INPMIS=ECI increased...
India, U.S. closing in on trade deal
ECONOMIC NEWS

India, U.S. closing in on trade deal

By Administrator_India Capital Sands India and the United States are closing in on a trade deal, Commerce Minister Piyush Goyal said on Tuesday, after two years of negotiations. India is seeking concessions for generic drugs it exports to the United States in return for opening its dairy markets and slashing tariffs on farm goods as the two sides seek to clinch a new trade accord, sources told. They have been negotiating a limited trade pact aimed also at restoring zero tariffs on a range of Indian exports to the United States under its Generalised System of Preferences , from which the Trump administration withdrew last year, citing lack of reciprocal access to Indian markets. “In the long term, I believe we have a quick trade deal which has some of the pending matters buil...