The Rupee started the week well and set the tone but the ‘missed’ opportunities to churn the portfolio finally got to traders as the index is definitely not more than range bound though biased to the Northerlies taking it up. The resulting afternoon correction should not have worried you unless you were the few who entered this week in the last INR20,000 Crs or 200 B entering the cash market, which is going to be in a little trouble as the downward trend for Hero and the continuing travails of Infy emerge again with IT scrips getting hammered for prices booked in September in their quarterly results.
The Rupee hopefully will get to stronger ground nearer 52 than 53 before Oil prices rear their ugly head again, precariously poised at $92/$116 for WTI/Brent per barrel and India staring at just concluded well priced contracts askance if they could still bite on the WAC cost of our rising Oil bill. The September deficit climbed out of the hidden trenches on mass buying of Oil atleast as it seems from the monthly deficit and the growth in China’s exports can only do so much for our exports to Big brother.
Obama is back in the reckoning and though that does not mean good things for outsourcing followers, most IT companies have been hiring locally and settling down in the US as local color than exporters of manpower with a more than 10% bench at Infyand hiring for special skills in larger accounts now more than remotely likely. Banks and global financial services majors have much more bandwidth going into 22013 to expand footprint in Asia again outside of Goldman Sachs which is already fully invested in growth portfolios and the Deal markets should help further FDI/FII interest too.
India has managed to get extra flows without affecting prospects for Mexico or Turkey showing Emerging market inflows are more collaborative than competitive and US equity inflows should not impact the flows adversely either but worries come from the coming increase in share of the Commodities complex and the Japanese commitment to keep buying US Treasuries. Japan’s currency’s new turn is alsoa great story as the over valued currency seems to be in line for a big correction in value as China gets left behind in the list of US Treasury holders and the regional argument between China an djapan is balanced by the weakness in the Yen for Japanese and probably Korean exports as well.
- India Morning Report October 12, 2012: The Correction Continues Into The Weekend Close! (awardz.wordpress.com)
- India Morning Report : Consumer story sell down triggered in lackluster October (awardz.wordpress.com)
- Indian FX/debt factors to watch – Oct 15 (uk.reuters.com)
- PwC Unveils Report on the Role of E&P in India’s Energy Security (sys-con.com)
- Malaysia to lower export duty on crude palm oil (shippingtribune.com)