• 11 JUN
  • Knight Snippet
  • 11/06/2021

Transcript

Good Morning Treasurers,
This is your host Priyancka Mahore, AVP of Knight Fintech and you are listening to Knight Snippets.
Here is all what you need to know before going into trade for 11-June-2021.

International Market:
- US Consumer prices for May increased at their fastest clip in nearly 13 years as inflation pressures continued to accelerate in the U.S. economy
- Consumer Price Index rose 5% y-o-y Vs. economists expectation of 4.7%
- In April,  CPI increased 4.2% Vs. 5.00% in May-2021
- Investors had already priced in inflation and US 10-year yields had rose from 0.55% to 1.75% in the past 9-months
- Now, the real question is: Will the inflation be as FED thinks "transitory in nature" or here to stay?
- Many of the corporates have started to pass-on the inflation to the end-consumers as the raw material costs have spiked like never before
- As far as the trading is concerned, BUY the rumors, SELL the NEWS is what has caught up with the bond market  
- Contrary to everyone's belief, with higher inflation, US 10-year closed 5 bps down at 1.45% and 30-year closed 2 bps down at 2.15% on Thursday
- Investors have now seen the inflation, and are waiting for the confirmation before the next leg of rally in yields
- On the other hand, ECB President Christine Lagarde :  
“Inflation has picked up over recent months, largely on account of base effects, transitory factors and an increase in energy prices.  
It is expected to rise further in the second half of the year, before declining as temporary factors fade out”
- So, both ECB and FED are playing the same transitory inflation story, which market needs to confirm. But, till then the yields will be in check

Crude Oil Market:
- Crude is trading at $72.35/bbl
- Crude short term range: $69-73

Currency Market:
- Dollar index (DXY) is at: 90.02
- DXY today's range: 89.86 - 90.21
- USDCNY or Chinese yuan is at 6.39
- USDINR with a high of 73.12, closed at 73.06
- USDINR range: 72.85 - 73.25

Watch Out:
US jobless claims today

Domestic Market:
India's inflation numbers will be out Monday after market hours
- Market participants expect a rise in May-2021, where inflation may come at 5.40% Vs. April-2021's 4.29%
- Nothing much to be derived from May-21's inflation numbers as in April-May-2020 (last year) due to nationwide lockdowns, the data collection was a challenge

Finally the much awaited G-SAP 1.0 third tranche information is out in the market.
As declared by RBI Govr, Rs. 10,000 Cr SDLs and Rs. 30,000 Cr G-Sec are part of this third tranche
- In G-Sec, the eligible securities are:

6.97 2026
6.79 2027
7.17 2028
7.59 2029
5.85 2030
6.64 2035
- Both, 10 & 15 years have been included in the list
- As 5.63 GS 2026 has not been included in the list, we may see some selling in 5.63 2026

 - 5.63 GS 2026 closed at 5.49% Vs 5.52% the previous trading day;  
- 5.85 GS 2030 closed at 6.02% Vs 6.01% the previous trading day;  

Note:
- Do expect a sell-off in 5.63 2026 from 5.49% yields till 5.53% as it it has not been added in the G-SAP 1.0 third tranche

Knight Research:
5.85 GS 2030 range: 6.00% - 6.05% range

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

See you on Monday with a new episode of Knight Snippets.

Macro Economic Events

Indicator Last Expected AsOn Next
Inflation Rate MoM MAY   [GB] 0.60 0.30 14/06/21 16/06/21
Inflation Rate YoY MAY   [GB] 1.50 0.70 14/06/21 16/06/21
Jobless Claims 4 Week Average   [US] 428.0 458.5 07/06/21 10/06/21
Stock Investment by Foreigners   [JP] -181.3 -233.2 07/06/21 10/06/21
Balance Of Trade MAY   [SG] 5,755 5,414 14/06/21 17/06/21
Balance Of Trade APR   [GB] -935.0 -1,966.0 07/06/21 11/06/21
Core PPI MoM MAY   [US] 0.0000 122.0000 14/06/21 15/06/21
Foreign Bond Investment   [JP] 410.6 664.8 14/06/21 17/06/21
Foreign Bond Investment APR   [US] 118,900 -65,500 14/06/21 16/06/21
Balance Of Trade MAY   [JP] 255.3 662.2 14/06/21 16/06/21
Industrial Production YoY MAY   [CN] 9.80 14.10 14/06/21 16/06/21
EXPORT MAY   [IN] 32,210 30,630 14/06/21 15/06/21
Balance Of Trade MAY   [IN] -6,320 -15,100 14/06/21 15/06/21
FIXED ASSET INVESTMENT (YTD) YoY MAY   [CN] 19.9 25.6 14/06/21 16/06/21
Continuing Jobless Claims   [US] 3,771 3,602 07/06/21 10/06/21
Inflation Rate MoM MAY   [US] 0.80 0.60 07/06/21 10/06/21
Import Price YoY MAY   [KR] 109.2 109.8 07/06/21 11/06/21
WPI Manufacturing YoY MAY   [IN] 12.9 13.1 11/06/21 14/06/21
Stock Investment by Foreigners   [JP] -33.2 94.7 14/06/21 17/06/21
EXPORT YoY MAY   [JP] 7,181 7,378 14/06/21 16/06/21
FDI (YTD) YoY MAY   [CN] 753.0 590.4 11/06/21 14/06/21
Core PPI YoY MAY   [US] 122.8 122.0 14/06/21 15/06/21
Industrial Production YoY MAY   [CN] 9.80 14.10 14/06/21 16/06/21
Inflation Rate YoY MAY   [SA] 5.30 4.90 14/06/21 15/06/21
Interest Rate Decision   [BR] 4.25 3.50 14/06/21 17/06/21
WPI Manufacturing YoY MAY   [IN] 12.9 13.1 11/06/21 14/06/21
Foreign Bond Investment   [JP] -1,090 551 07/06/21 10/06/21
Core Inflation Rate YoY MAY   [US] 3.00 1.60 07/06/21 10/06/21
GDP MoM APR   [GB] 2.10 2.10 07/06/21 11/06/21
Unemployment Rate MAY   [AU] 5.10 5.50 14/06/21 17/06/21
PPI Input YoY MAY   [GB] 9.90 10.60 14/06/21 16/06/21
Industrial Production MoM APR   [JP] 2.90 1.70 11/06/21 14/06/21
Capacity Utilization MoM APR   [JP] 99.3 98.2 11/06/21 14/06/21
Retail Sales MoM MAY   [US] 0.0000 10.7000 14/06/21 15/06/21
Inflation Rate YoY MAY   [IN] 4.29 5.20 11/06/21 14/06/21
PPI Output MoM MAY   [GB] 111.6 111.1 14/06/21 16/06/21
Employment Change MAY   [AU] 115,200 -30,700 14/06/21 17/06/21
Housing Price Index QoQ Q1   [AU] 3.00 0.80 14/06/21 15/06/21
Core Inflation Rate MoM MAY   [US] 273.7 271.2 07/06/21 10/06/21
Core Inflation Rate YoY MAY   [GB] 1.30 1.10 14/06/21 16/06/21
Business Confidence JUN   [BR] 58.5 53.7 11/06/21 14/06/21
Import YoY MAY   [JP] 6,926 6,714 14/06/21 16/06/21
Initial Jobless Claims   [US] 412.0 375.0 14/06/21 17/06/21
Employment Change MAR   [GB] 84.0 -73.0 14/06/21 15/06/21
Housing Price Index YoY MAY   [CN] 4.90 4.80 14/06/21 17/06/21
PPI MoM May   [RU] 227.2 221.5 14/06/21 17/06/21
Unemployment Rate MAY   [CN] 5.10 5.30 14/06/21 16/06/21
Unemployment Rate APR   [GB] 4.80 4.90 14/06/21 15/06/21
Unemployment Rate Q1   [SG] 2.90 3.30 14/06/21 15/06/21
Outstanding Loan Growth YoY MAY   [CN] 12.3 12.6 04/06/21 10/06/21
Industrial Production YoY APR   [JP] 15.8 3.4 11/06/21 14/06/21
PPI Output YoY MAY   [GB] 3.90 2.30 14/06/21 16/06/21
WPI Inflation YoY MAY   [IN] 12.5 13.1 11/06/21 14/06/21
PPI MoM May   [RU] 227.2 221.5 14/06/21 17/06/21
Retail Sales YoY MAY   [US] 51.2 29.0 14/06/21 15/06/21
Housing Price Index YoY Q1   [AU] 3.00 0.80 14/06/21 15/06/21
GDP Growth Rate YoY Q1   [RU] -1.00 -1.80 14/06/21 15/06/21
Inflation Rate YoY MAY   [US] 4.20 2.60 07/06/21 10/06/21
Export Price YoY MAY   [KR] 104.0 101.8 07/06/21 11/06/21
IMPORT MAY   [IN] 38,530 39,598 14/06/21 15/06/21
Manufacturing Production YoY MAY   [US] 23.0 3.2 14/06/21 15/06/21
Industrial Production YoY MAY   [US] 16.5 1.0 14/06/21 15/06/21

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
91 DTB 16/09/2021 91 DTB 15000 3.42% - 3.44% 16/06/21 14:58 3.4692% 15000 Yield 11/06/21 16/06/21 17/06/21
6.81% KLSDL 2031 10 Y 1000 6.82% - 6.84% 15/06/21 15:21 6.81% 1000 Yield 10/06/21 15/06/21 16/06/21
6.83% MHSDL 2032 11 Y 1000 6.85% - 6.88% 15/06/21 15:19 6.83% 1500 Yield 10/06/21 15/06/21 16/06/21
5.63% GS 2026 5 Y 11000 99.87 - 99.92 18/06/21 19:35 100.11 8221 Price 14/06/21 18/06/21 21/06/21
6.76% GS 2061 40 Y 9000 6.96% - 6.97% 11/06/21 16:47 6.9625% 9000 Yield 07/06/21 11/06/21 14/06/21
6.96% TNSDL 2056 35 Y 1000 7.05% - 7.10% 15/06/21 15:23 7.0289% 1000 Yield 10/06/21 15/06/21 16/06/21
7.03% TSSDL 2051 30 Y 3000 7.05% - 7.10% 15/06/21 15:26 7.03% 3000 Yield 10/06/21 15/06/21 16/06/21
5.85% GS 2030 10 Y 14000 98.74 - 98.77 11/06/21 16:51 98.97 9975 Price 07/06/21 11/06/21 14/06/21
6.80% MHSDL 2031 10 Y 1000 6.82% - 6.84% 15/06/21 15:24 6.80% 1500 Yield 10/06/21 15/06/21 16/06/21
6.84% RJSDL 2031 10 Y 750 6.82% - 6.84% 15/06/21 15:18 6.84% 750 Yield 10/06/21 15/06/21 16/06/21
6.67% GS 2050 30 Y 7000 7.03% - 7.05% 18/06/21 19:33 7.0254% 7000 Yield 14/06/21 18/06/21 21/06/21
4.26% GS 2023 2 Y 3000 4.18% 11/06/21 16:54 4.1929 3750 Yield 07/06/21 11/06/21 14/06/21
6.64% GS 2035 15 Y 10000 99.58 - 99.63 18/06/21 19:34 99.60 12500 Price 14/06/21 18/06/21 21/06/21
6.81% PNSDL 2031 10 Y 1500 6.82% - 6.84% 15/06/21 15:16 6.8209% 1500 Yield 10/06/21 15/06/21 16/06/21
182 DTB 16/12/2021 182 D 15000 3.66% - 3.68% 16/06/21 14:59 3.6969% 15000 Yield 11/06/21 16/06/21 17/06/21
6.92% HRSDL 2036 15 Y 1000 6.90% - 6.92% 15/06/21 15:08 6.92% 1000 Yield 10/06/21 15/06/21 16/06/21
6.78% GASDL 2031 10 Y 100 6.82% - 6.84% 15/06/21 15:10 6.78% 100 Yield 10/06/21 15/06/21 16/06/21
5.65% TNSDL 2025 4 Y 1000 5.50% - 5.52% 15/06/21 15:15 5.65% 1000 Yield 10/06/21 15/06/21 16/06/21
364 DTB 16/06/2022 364 D 6000 3.74% - 3.76% 16/06/21 15:00 3.8526% 6000 Yield 11/06/21 16/06/21 17/06/21
6.05% RJSDL 2026 5 Y 750 6.12% - 6.14% 15/06/21 15:07 6.05% 750 Yield 10/06/21 15/06/21 16/06/21
6.75% GJSDL 2031 10 Y 1000 6.82% - 6.84% 15/06/21 15:06 6.75% 1000 Yield 10/06/21 15/06/21 16/06/21

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