• 06 MAY
  • Knight Snippet
  • 06/05/2021

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 06-May-2021.

International Market:
- US 10-year Treasury Inflation-Protected Securities (TIPS) topped 2.47%, its highest level since April 2013 indicating the markets sees inflation averaging closer to 2.5% a year for the next decade
- For five-year TIPS, the breakeven inflation rate hit 2.69%, its highest since April 2011
- Even after TIPS hitting multi-year highs, Federal Reserve officials downplayed the risk of a big and sustained rise in inflation
- With FED's comfort and no panic situation and awaiting Friday's employment numbers, US 10-year closed another 2 bps lower at 1.59% and 30-year also closed 2 bps lower at 2.25% on Wednesday
- After the recent sell-off in the equity markets, markets were calm.
- Globally yields were inching lower . German 10-year after touching a high of -0.16% is now trading at -0.23%. But, in Germany also the yield curve will steepen

Crude Oil Market:
- Crude is trading at $68.65/bbl
- Crude short term range: $67-70
- Knight Research: We are now upgrading our target for Dec-end to $80/bbl from $70 on the back of robust economic recovery and vaccination success

Currency Market:
- Dollar index (DXY) is at: 91.27
- DXY today's range: 91.04 - 91.46
- As we had said, DXY is directionless and may get clues from Friday's employment numbers  
- USDCNY or Chinese yuan is at 6.48
- USDINR with a low of 73.80, closed at 73.91
- On an intra-day basis, USDINR did touch 74.04 for brief period
- USDINR range: 73.62 - 74.00

Domestic Market:
- RBI Governor Shaktikanta Das yesterday announced a second tranche of the G-SAP worth Rs. 35,000 Cr to be conducted on May 20
- The first tranche was a success as per Govr and it had a bid-cover ratio of 4.1
- The announcement of Rs. 35,000 Cr again lifted the sentiments across the participants

5.63 GS 2026 closed at 5.56% Vs 5.59% the previous trading day;
5.85 GS 2030 closed at 5.98% Vs 6.01% the previous trading day;  

Traders believe that, 5.85 GS 2030 is unlikely to sustain below 6.00% for long
- There is a scheduled operation twist today and Knight Research will be available with expected cut-offs

Knight Success:
- We had informed you all on the very same podcast yesterday that Shaktikanta Das is addressing in the morning and there may be 2-3 bps opportunity and we were able to capture it
- Now, today everything depends on OT cut-offs and we are not so aggressive. We want you to cut your positions before the cut-offs as we fear the market will reach beyond 6.00% again today
- Broadly, the market range for 5.85 GS 2030 will be 5.95% - 6.03%

That's it for today.  You were listening to Knight Snippets with Parthesh Shah from Knight Fintech.

See you tomorrow with a new episode of Knight Snippets.

Macro Economic Events

Indicator Last Expected AsOn Next
Retail Sales YoY MAR   [SG] -6.10 5.20 30/04/21 05/05/21
Industrial Production MoM MAR   [GB] -1.80 1.00 10/05/21 12/05/21
Household Spending MoM MAR   [JP] 2.40 2.40 10/05/21 11/05/21
Inflation Rate YoY APR   [BR] 5.20 6.10 10/05/21 11/05/21
Manufacturing Production YoY MAR   [GB] -5.00 -4.20 10/05/21 12/05/21
Markit composite PMI APR   [BR] 49.6 45.1 30/04/21 05/05/21
Industrial Production YoY MAR   [GB] -4.30 -3.50 10/05/21 12/05/21
Initial Jobless Claims   [US] 566.0 553.0 01/05/21 06/05/21
Business Investment QoQ Q1   [GB] 13.2 5.9 10/05/21 12/05/21
Goods Trade Balance MAR   [GB] -12,592 -16,442 10/05/21 12/05/21
Markit composite PMI APR   [RU] 52.6 54.6 01/05/21 06/05/21
Retail Sales MoM MAR   [AU] -0.80 1.30 07/05/21 10/05/21
Markit Services PMI APR   [IN] 55.3 54.6 30/04/21 05/05/21
Retail Sales MoM MAR   [SG] -1.70 -1.60 30/04/21 05/05/21
Vehicle Sales YoY APR   [CN] 1,454,806 2,525,691 10/05/21 11/05/21
Markit Manufacturing PMI APR   [TH] 47.8 48.8 30/04/21 05/05/21
Industrial Production YoY MAR   [BR] 2.30 0.40 30/04/21 05/05/21
Foreign Exchange Reserves   [RU] 586,266 573,322 01/05/21 06/05/21
Monetary Policy Report   [GB] 0.1000 0.1000 01/05/21 06/05/21
Manufacturing Production YoY MAR   [IN] 0.0000 0.0000 10/05/21 12/05/21
GDP Growth Rate QoQ Q1   [GB] 16.9 1.3 10/05/21 12/05/21
Business Investment YoY Q1   [GB] 13.2 5.9 10/05/21 12/05/21
Balance Of Trade MAR   [GB] -3,370 -7,123 10/05/21 12/05/21
MPC Meetings Minutes   [GB] 0.1000 0.1000 01/05/21 06/05/21
Household Spending YoY MAR   [JP] -6.60 -6.10 10/05/21 11/05/21
Inflation Rate MoM APR   [BR] 0.86 0.93 10/05/21 11/05/21
Foreign Exchange Reserves   [KR] 446,130 447,560 01/05/21 06/05/21
Inflation Rate MoM APR   [CN] -0.50 0.60 10/05/21 11/05/21
Markit Services PMI APR   [RU] 55.8 55.2 01/05/21 06/05/21
GDP YoY MAR   [GB] -8.50 -7.80 10/05/21 12/05/21
Foreign Exchange Reserves APR   [JP] 1,379,400 1,368,500 10/05/21 12/05/21
Unemployment Rate APR   [KR] 3.90 4.00 10/05/21 11/05/21
Industrial Production MoM MAR   [BR] 0.40 -0.70 30/04/21 05/05/21
PPI YoY APR   [CN] 4.40 1.70 10/05/21 11/05/21
Jobless Claims 4 Week Average   [US] 655.8 611.8 01/05/21 06/05/21
Interest Rate Decision   [BR] 2.75 3.50 01/05/21 06/05/21
Inflation Rate YoY Apr   [CN] 0.40 -0.20 10/05/21 11/05/21
Markit Services PMI APR   [BR] 47.1 44.1 30/04/21 05/05/21
Inflation Rate YoY Apr   [IN] 0.0000 0.0000 10/05/21 12/05/21
GDP Growth Rate YoY Q1   [GB] -8.50 -7.30 10/05/21 12/05/21
Manufacturing Production MoM MAR   [GB] 1.30 1.50 10/05/21 12/05/21

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
6.64% GS 2035 15 Y 10000 100.44 - 100.48 07/05/21 15:15 100.47 10000 Price 03/05/21 07/05/21 10/05/21
6.94% APSDL 2037 16 Y 1000 6.82% - 6.90% 11/05/21 15:17 6.94% 1000 Yield 06/05/21 11/05/21 12/05/21
5.63% GS 2026 5 Y 11000 100.38 - 100.42 07/05/21 15:15 100.36 11000 Price 03/05/21 07/05/21 10/05/21
6.88% MHSDL 2033 12 Y 1500 6.88% 11/05/21 15:16 6.88% 1500 Yield 06/05/21 11/05/21 12/05/21
364 DTB 04/05/2022 364 D 6000 3.69% - 3.72% 05/05/21 16:09 3.7199% 6000 Yield 30/04/21 05/05/21 06/05/21
6.79% HRSDL 2031 10 Y 1000 6.80% 11/05/21 15:13 6.79% 1000 Yield 06/05/21 11/05/21 12/05/21
91 DTB 12/08/2021 91 D 15000 3.34% - 3.37% 21/05/21 16:55 3.3692% 15000 Yield 07/05/21 12/05/21 13/05/21
6.90% MZSDL 2033 12 Y 150 6.82% - 6.90% 11/05/21 15:18 6.90% 150 Yield 06/05/21 11/05/21 12/05/21
182 DTB 11/11/2021 182 D 15000 3.51% - 3.53% 21/05/21 16:56 3.5701% 15000 Yield 07/05/21 12/05/21 13/05/21
6.83% WBSDL 2031 10 Y 2000 6.78% - 6.80% 11/05/21 15:23 6.83% 2000 Yield 06/05/21 11/05/21 12/05/21
6.49% TNSDL 2050 30 Y 1500 6.82% - 6.90% 11/05/21 15:26 6.9297% 1500 Yield 06/05/21 11/05/21 12/05/21
91 DTB 04/08/2021 91 D 15000 3.33% - 3.34% 05/05/21 16:07 3.3346% 15000 Yield 30/04/21 05/05/21 06/05/21
6.67% GS 2050 30 Y 7000 6.82% - 6.84% 07/05/21 15:17 6.8203% 7000 Yield 03/05/21 07/05/21 10/05/21
6.63% TNSDL 2055 35 Y 1500 - 11/05/21 15:14 6.9301% 1500 Yield 06/05/21 11/05/21 12/05/21
6.94% APSDL 2038 17 Y 1000 6.82% - 6.90% 11/05/21 15:22 6.94% 1000 Yield 06/05/21 11/05/21 12/05/21
6.84% MHSDL 2032 11 Y 1500 6.82% 11/05/21 15:20 6.84% 1500 Yield 06/05/21 11/05/21 12/05/21
182 DTB 03/11/2021 182 D 15000 3.53% - 3.55% 05/05/21 16:11 3.5499% 15000 Yield 30/04/21 05/05/21 06/05/21
6.77% RJSDL 2031 10 Y 500 6.78% 11/05/21 15:25 6.77% 500 Yield 06/05/21 11/05/21 12/05/21
364 DTB 12/05/2022 364 D 6000 3.70% - 3.72% 21/05/21 16:56 3.72% 6000 Yield 07/05/21 12/05/21 13/05/21
6.13% RJSDL 2026 5 Y 500 6.27% - 6.30% 11/05/21 15:24 6.13% 500 Yield 06/05/21 11/05/21 12/05/21

Credit Research: Exposures and Next IP Dates

Housing Development Finance Corpn. Ltd.

Zero Coupon Bonds

News Bites

To stay updated with us click here for news bites.

Daily Research Report

Click here for Daily Research Reports.