9 February 2018
Daily Currency outlook • PRODUCT 1 Other Product offerings
C u r r e n cy
Recommendation in the report Currency pair
Contract
Action
Price
Target
Stoploss
Duration
US$INR
February futures
Buy
64.36-64.42
64.65
64.23
1-2 days
A ctio n
EURINR
S ell
EURJPY
Buy
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•
PRODUCT 2
ICICI Securities – Retail Equity Research
Mo n th ly C u r r e n cy an d T h e m atic r e p o r ts
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Research Analysts
Amit Gupta
[email protected] Gaurav Shah
[email protected]
Currency
Close
Pvs. Close
% Change
Rupee
64.26
64.29
-0.04
US$ index
90.23
90.26
-0.03
EuroUS$
1.2247
1.2264
-0.14
GBPUS$
1.3913
1.3881
0.23
US$JPY
108.74
109.33
-0.54
AUDUS$
0.7781
0.7823
-0.54
US$CHF
0.9362
0.9439
-0.82
• The rupee was little changed against the dollar, tracking broad greenback strength as the euro remained under pressure, offsetting dollar sales by corporates and foreign banks • The US ideally dollar is slightly lower major currencies as US should begin toagainst worry ECB, as iteven would equities have seen sharp selling in yesterday’s session. Weakness undermine inflation growth in the in Asian equities along with a rise in yields mayEurozone weigh on domestic equities as well, thus leading to rupee weakness. We expect the JPY to gain in such a scenario amid safe buying while the euro could remain under pressure
Global Equity Indices Indices
Close
Pvs. Close
% Change
Dow Jones
23860
24893
-4.15
Nasdaq
6306
6582
-4.19
FTSE
7171
7279
-1.49
DAX
12260
12590
-2.62
HangSang
29167
30451
-4.22
Nikkei
21176
21891
-3.26
SGX Nifty
10345
10561
-2.05
• Equity benchmarks posted strong gains on the back of positive global cues. Eventually, the Nifty settled at 10577, up 100 points or almost 1% • The broader market outperformed the benchmarks as the Nifty midcap and small cap gained 1.8% and 2.4%, respectively, resulting in strong market breadth with an A/D ratio of almost 5:1
*Asian equity indices at 8.00 am
February 9, 2018
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Spot Currency
CURRENCY OUTLOOK
Forex and global equities
Debt and FII activity Close
Pvs. Close
% Change
India 10-yr
7.47
7.53
-0.81
US 10-yr
2.82
2.84
-0.42
Eur 10-yr
0.76
0.75
2.28
UK 10-yr
1.62
1.55
4.26
JPY 10-yr
0.08
0.08
6.58
Commodities Close
Pvs. Close
% Change
Gold
1319
1318
0.03
Copper
308.2
308.8
-0.18
64.8
65.5
-1.07
Brent
FII Activity Equity
5898
6899
-1001
Debt
491
901
-410
February 9, 2018
• Government bonds jumped yesterday, as investors bet the central bank is unlikely to increase interest rates in the near future • We expect domestic yields to rise further as hardening global yields may see outflows from debt markets while risks of domestic inflation would also weigh on bond prices
• Gold failed to rally even as US equities witnessed sharp selling. Rising US yields make its expensive to hold non-interest paying asset, which is lowering gold’s appeal in the current scenario • Crude oil extended losses along with other risk assets tracking a rise in US yields. However, downsides would remain capped in the backdrop of Opec oil accord extension
• Foreign institutional investors (FII) were net sellers to the tune of | 1411 crore in the previous session • FIIs have invested almost | 3060 crore in domestic markets till date in February 2018
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Benchmark yield
INR futures and Outlook Currency futures on NSE Contracts
LTP
chng (%)
OI
Vol
February
64.40
-0.06
1181766
March
64.63
-0.05
Feb-Mar
-0.22
Mar-Apr
-0.24
chng (%) OI
Vol
1536141
2.69
27.98
350709
96723
4.37
28.95
-
-
1439418
-
93.70
-
-
81469
-
84.23
Pivot levels
• The near month dollar-rupee February contract on the NSE was at 64.40. The February contract open interest increased 2.69% from the previous day
•c
• We expect the US$INR to witness buying at lower levels. Utilise downsides in the pair to initiate long positions
Futures
Pivot
S1
S2
R1
R2
US$INR Feb futures contract (NSE)
View: Bullish on US$INR
US$INR (Feb)
64.42
64.73
64.12
64.56
64.71
Buy US$INR in the range of 64.36 - 64.42
Market Lot: US$1000
US$INR (Mar)
64.64
64.93
64.36
64.77
64.92
Target: 64.70/ 64.80
Stop Loss: 64.23
EURINR (Feb)
79.03
79.67
78.52
79.21
79.53
Support
Resistance
EURINR (Mar)
79.43
80.17
78.86
79.64
80.01
S1/ S2: 64.40 / 64.30
R1/R2:64.65 /64.75
GBPINR (Feb)
89.49
89.87
89.05
89.73
89.92
GBPINR (Mar)
89.87
90.22
89.44
90.11
90.29
JPYINR (Feb)
58.90
59.70
58.21
59.18
59.58
JPYINR (Mar)
59.10
59.60
58.65
59.31
59.55
February 9, 2018
ICICI Securities Ltd. | Retail Equity Research
ICICI Securities – Retail Equity Research
US$INR Strategy
4
US$INR Spot currency
ICICI Securities – Retail Equity Research
US$INR Spot
Strategy Update Date 8-Feb-18
February 9, 2018
C u r r e n cy p air US$INR
Str ate g y
Re c.
T ar g e t
SL
Buy future
64.32
64.65
64.10
ICICI Securities Ltd. | Retail Equity Research
(P/L )*
Com m ent Not initiated
5
Open Recommendations
Date
C u r r e n cy
Pr o d u ct
Str ate g y
Re co m m e n d atio n p r ice
T ar g e t
Sto p lo s s
T im e fr am e
6/30/2017
EURJPY
Currency thematic
Buy EURINR & S ell JPY INR
16.10
28.00
10.00
6-9 months
7/28/2017
Rupee
Currency thematic
S ell US $INR
64.35
62.00
66.30
6-9 months
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February 9, 2018
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Head – Research
[email protected]
ICICI Securities – Retail Equity Research
Pankaj Pandey
ICICIdirect.com Research Desk, ICICI Securities Limited, 1st Floor, Akruti Trade Centre, Road No 7, MIDC, Andheri (East) Mumbai – 400 093
[email protected]
February 9, 2018
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