• 16 OCT
  • Knight Snippet
  • 16/10/2020

Transcript

Good Morning Treasurers,

This is your host Parthesh Shah, Co-Founder of Knight Fintech and you are listening to Knight Snippets.

Here is all what you need to know before going into trade for 16-Oct-2020.

International Market:
- Paris and London have both instituted limits to social activity in a bid to contain the spread of the coronavirus

- In U.S. economic data, weekly jobless claims data climbed 53,000 to 8.98 Lakhs, the highest level since Aug. 22.

- Rising global infection rates, a setback in vaccine trails and anxiety over election outcomes: These 3 reasons will continue to keep both equities and debt markets volatile

- US 10-year closed at 0.74% and 30-year at 1.52%

- German 10-year at -0.59%, the lowest since mid-March due to uncertainity on US fiscal stimulus, and rising COVID-19 cases in Europe

Crude Oil Market:
- OPEC+ reassured the market yesterday that, they will let oil market to crash again

- Member nations were also hopeful to increase the production in oil from January as it was decided early even though COVID-19 continues to rattle to economies

- Brent crude is trading at $42.95/bbl

- Long Term View: $50/bbl in next 6 months

Currency Market:
- Dollar Index (DXY) at 93.78

- Did you notice that, our yesterday's upper trading range was 93.85 and DXY closed at 93.86?

- Again, this is not a bright guess. It is actually the mathematical models working behind to predict as accurately as possible

- The RISK_OFF approach is helping the US dollar and  

- Dollar Index Range: 93.57 - 94.20

- USDINR with a high of 73.47, closed at 73.43 on Thursday

- Point to note is: USDINR has not breached 73.50 even-on intra-day basis yet for the last few weeks, which may happen today

- USDINR Range: 73.20 - 73.55

- All of our clients are minting money in USDINR pair due to its strict range-bound movements and it has become heaven for currency traders for now

Domestic Market:
- The central Govt revised its borrowing plan

- Initially center had planned to borrow 4.34 Lakh Cr in H2, but now it has been revised upwards to 4.88 Lakh Cr

- The additional borrowing will be to compensate states for the GST CESS shortfall

- The additional borrowing will come in 3 and 5 year maturities

- Hence, we will see an uptick in yields 3-5 year maturities due to Rs. 55,000 Cr additional supply

- But, as RBI has promised to keep the liquidity in check and heavy OMOs to address these concerns, we do not worry much on 3-5 year maturities

 15-Oct-2020 - Rs. 20,000 Cr OMO analysis:

- The meaningful observation was 5.79 GS 2030 cut-off was at 5.86 or 99.48 with Rs. 3,475 Cr purchases

- The quantum in 10-year maturity was less than anticipated

- The cut-off was also as per our yesterday's prediction of 5.86 and there was not much cheer as RBI was not so aggressive and sent a signal that they are comfortable with current rates

- RBI is trying hard to shape up the yield curve with large purchases in 2026-2027 maturities which was seen yesterday's OMO as well

Today, there will be a G-sec auction and we will be available again with cut-off ranges by 10.30am

If you haven't subscribed to our trading services or auction services, you can reach out to us on 99 3030 7466 or research@knightfitnech.com

That's it for today.  You were listening to Knight Snippets with Parthesh Shah, Co-Founder of Knight Fintech.

See you next week with the new episode of Knight Snippets.

Macro Economic Events

Indicator Last Expected AsOn Next
PPI MoM SEP   [US] 652.1 658.8 12/10/20 16/10/20
Industrial Production MoM SEP   [US] 3.50 0.40 12/10/20 16/10/20
Deposit Growth YoY   [IN] 12.0 10.5 19/10/20 23/10/20
Inflation Rate MoM SEP   [JP] 0.20 -0.10 19/10/20 23/10/20
Balance Of Trade SEP   [SG] 3,211 5,832 12/10/20 16/10/20
Unemployment Rate SEP   [CN] 5.70 5.60 16/10/20 19/10/20
Retail Sales ex Fuel MOM SEP   [GB] 2.10 0.60 19/10/20 23/10/20
Industrial Production YoY SEP   [US] -7.40 0.00 15/10/20 15/10/20
PPI Input MoM SEP   [GB] -0.40 -0.50 16/10/20 21/10/20
Core Inflation Rate YoY SEP   [JP] 0.0000 -0.4000 19/10/20 22/10/20
Industrial Production YoY SEP   [CN] 4.80 5.60 16/10/20 19/10/20
Existing Home Sales SEP   [US] 5,860 6,000 19/10/20 22/10/20
Industrial Trends Order OCT   [GB] -44.0 -48.0 19/10/20 22/10/20
Retail Sales YoY SEP   [RU] -2.60 -2.70 16/10/20 20/10/20
Housing Starts SEP   [US] 1,492 1,416 16/10/20 20/10/20
Continuing Jobless Claims   [US] 11,183 10,018 19/10/20 22/10/20
Bank Lending YoY   [IN] 5.30 5.10 19/10/20 23/10/20
GDP Growth Rate QoQ   [CN] -10.00 11.50 16/10/20 19/10/20
Initial Jobless Claims   [US] 845.0 898.0 19/10/20 22/10/20
PPI Output YoY SEP   [GB] -0.90 -0.90 16/10/20 21/10/20
Retail Sales MoM SEP   [US] 0.90 0.60 12/10/20 16/10/20
Inflation Rate MoM SEP   [CN] 0.60 0.40 09/10/20 15/10/20
Core Inflation Rate MoM SEP   [GB] 109.7 109.0 16/10/20 21/10/20
Housing Price Index YoY SEP   [CN] 4.80 4.80 16/10/20 20/10/20
Stock Investment by Foreigners   [JP] 531.4 1,421.0 19/10/20 22/10/20
Jobless Claims 4 Week Average   [US] 858.3 866.3 19/10/20 22/10/20
PPI YoY SEP   [RU] -2.20 -0.80 12/10/20 16/10/20
Manufacturing Production YoY AUG   [US] -7.30 -6.90 12/10/20 16/10/20
Retail Sales YoY gb   [GB] 1.40 2.80 19/10/20 23/10/20
Industrial Production YoY SEP   [US] 0.0000 0.0000 15/10/20 15/10/20
Foreign Bond Investment AUG   [US] -27,719 -22,800 16/10/20 17/10/20
Retail Sales MoM SEP   [GB] 3.70 0.80 19/10/20 23/10/20
Foreign Exchange Reserves   [IN] 545,638 551,505 19/10/20 23/10/20
Retail Sales YoY SEP   [CN] -1.10 0.50 16/10/20 19/10/20
Export Final SEP   [IN] 22,700 27,400 09/10/20 15/10/20
Manufacturing Production YoY SEP   [US] -7.30 -6.90 12/10/20 16/10/20
Industrial Production YoY SEP   [US] -7.40 -7.70 12/10/20 16/10/20
FDI (YTD) YoY SEP   [CN] 769.8 890.0 16/10/20 19/10/20
Imports Final SEP   [IN] 29,470 30,310 09/10/20 15/10/20
Unemployment Rate SEP   [RU] 6.30 6.40 16/10/20 20/10/20
PPI Core Output MoM SEP   [GB] 114.7 114.8 16/10/20 21/10/20
Retail Sales ex Fuel YOY SEP   [GB] 2.10 0.60 19/10/20 23/10/20
Inflation Rate YoY SEP   [CN] 2.70 2.40 09/10/20 15/10/20
Retail Price Index YoY SEP   [GB] 1.60 0.50 16/10/20 21/10/20
Inflation Rate YoY SEP   [JP] 0.30 0.20 19/10/20 23/10/20
GDP Growth Rate YoY   [CN] -6.80 3.20 16/10/20 19/10/20
Retail Sales YoY SEP   [US] 2.40 2.60 12/10/20 16/10/20
Foreign Exchange Reserves   [IN] 542,021 546 12/10/20 16/10/20
Inflation Rate MoM SEP   [GB] 0.40 -0.40 16/10/20 21/10/20
Balance Of Trade SEP   [JP] 10.9 248.3 16/10/20 19/10/20
PPI Core Output YoY SEP   [GB] 114.7 114.8 16/10/20 21/10/20
Balance Of Trade Final SEP   [IN] -6,770 -2,900 09/10/20 15/10/20
Core Inflation Rate YoY SEP   [GB] 1.00 0.20 16/10/20 21/10/20
Exports SEP   [JP] 5,369 5,233 16/10/20 19/10/20
Public Sector Net Borrowing SEP   [GB] -15,441 -35,920 16/10/20 21/10/20
Loan Prime Rate 1Y   [CN] 3.85 3.85 16/10/20 20/10/20
PPI Output MoM SEP   [GB] 115.1 115.1 16/10/20 21/10/20
GDP YoY SEP   [RU] -4.60 -4.30 16/10/20 20/10/20
Business Investment MoM   [US] -1.10 0.10 12/10/20 16/10/20
Retail Price Index MoM SEP   [GB] 1.60 0.50 16/10/20 21/10/20
Import YoY SEPJ   [JP] 5,357 4,984 16/10/20 19/10/20
Existing Home Sales MoM SEP   [US] 5,860 6,000 19/10/20 22/10/20
Capacity Utilization SEP   [US] 71.1 71.4 12/10/20 16/10/20

Auctions

Knight Statistical Poll vs. Actual Results
Security Name Tenure Notified Amount Expected
Cut-Off
Recommended At Actual-Cut-Off Amount Accepted Auction Type Announcement date Auction Date Settlement Date Source
5.22% GS 2025 5 Y 12000 99.98 - 100.00 23/10/20 13:45 100.10 12000 Price 19/10/20 23/10/20 26/10/20
7.16% GS 2050 30 Y 8000 6.79% - 6.80% 23/10/20 13:38 104.70 6000 Price 12/10/20 16/10/20 19/10/20
6.95% PNSDL 2040 20 Y 500 6.88% - 6.90% 20/10/20 15:11 100.53 485 Price 15/10/20 20/10/20 21/10/20
5.27% BRSDL 2024 4 Y 2000 5.25% - 5.30% 20/10/20 15:11 5.27% 2000 Yield 15/10/20 20/10/20 21/10/20
6.62% KASDL 2032 12 Y 1000 6.60% - 6.63% 20/10/20 15:10 6.62% 1000 Yield 15/10/20 20/10/20 21/10/20
5.09% GS 2022 2 Y 3000 - 23/10/20 13:45 101.69 3000 Price 19/10/20 23/10/20 26/10/20
91 DTB 21/01/2021 91 D 9000 3.20% - 3..22% 21/10/20 15:01 3.2115% 9000 Yield 16/10/20 21/10/20 22/10/20
364 DTB 21/10/2021 364 D 4000 3.45% - 3..48% 21/10/20 14:59 3.4595% 4000 Yield 16/10/20 21/10/20 22/10/20
6.62% JHSDL 2030 10 Y 1000 6.60% - 6.63% 20/10/20 15:30 6.62% 1400 Yield 15/10/20 20/10/20 21/10/20
182 DTB 22/04/2021 182 D 3000 3.36% - 3..38% 21/10/20 14:57 3.3501% 3000 Yield 16/10/20 21/10/20 22/10/20
6.56% MHSDL 2030 10 Y 1000 6.60% - 6.63% 20/10/20 15:29 6..56% 1500 Yield 15/10/20 20/10/20 21/10/20
6.56% ASSDL 2030 10 Y 500 6.60% - 6.63% 20/10/20 15:01 6.56% 500 Yield 15/10/20 20/10/20 21/10/20
6.54% UPSDL 2030 10 Y 2000 6.60% - 6.63% 20/10/20 15:06 6.54% 2000 Yield 15/10/20 20/10/20 21/10/20
6.87% APSDL 2035 15 Y 1000 - 20/10/20 15:08 6.87% 1000 Yield 15/10/20 20/10/20 21/10/20
5.22% GS 2025 5 Y 8000 99.69 - 99.71 23/10/20 13:39 99.70 8000 Price 12/10/20 16/10/20 19/10/20
6.47% MHSDL 2028 8 Y 1000 6.52% - 6.53% 20/10/20 15:03 6.47% 1500 Yield 15/10/20 20/10/20 21/10/20
5.24% ASSDL 2024 4 Y 500 5.25% - 5.30% 20/10/20 15:00 5.24% 500 Yield 15/10/20 20/10/20 21/10/20
6.51% KASDL 2030 10 Y 1000 6.60% - 6.63% 20/10/20 15:34 6.51% 1000 Yield 15/10/20 20/10/20 21/10/20
4.54% TNSDL 2023 3 Y 1000 - 20/10/20 15:07 99.46 1000 Price 15/10/20 20/10/20 21/10/20
6.19% GS 2034 14 Y 12000 99.02-99.05 23/10/20 13:40 99.05 14000 Price 12/10/20 16/10/20 19/10/20
6.80% GS 2060 40 Y 7000 6.77% - 6.79% 23/10/20 13:46 6.78% 7000 Price 19/10/20 23/10/20 26/10/20
5.77% GS 2030 10 Y 9000 99.00 - 99.05 23/10/20 13:47 99.03 9000 Price 19/10/20 23/10/20 26/10/20
6.89% MPSDL 2040 20 Y 1000 6.88% - 6.90% 20/10/20 15:02 6.89% 1000 Yield 15/10/20 20/10/20 21/10/20

Credit Research: Exposures and Next IP Dates

Reliance Jio Infocomm Ltd.

Non Convertible Debenture

SBI Cards & Payments Services Ltd.

Debenture

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