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    Climbing crude prices, cash crunch & other macro triggers for your day on D-Steet

    Synopsis

    Here's a look at the top macro triggers that may move market on Thursday.

    market3Agencies
    Breaking a nine-day gaining streak, the key Indian equity indices provisionally closed Wednesday's trade in the red on the back of heavy selling pressure in banks, consumer durables and auto stocks.
    Here’s a lowdown on top macro triggers that may move market on Thursday. This report was compiled from agency feeds.

    Saudi Wants Oil at $80-100 a Barrel
    Brent on Wednesday marked its highest level since November, 2014 at $73.93 per barrel. Industry sources say top oil exporter Saudi Arabia would be happy to see crude rise to $80 or even $100 a barrel, Riyadh will seek no changes to an OPEC supply-cutting deal even though the agreement's original target is within sight. The Organization of the Petroleum Exporting Countries, Russia and several other producers began to reduce supply in January 2017 in an attempt to erase a glut. They have extended the pact until December 2018 and meet in June to review policy. Saudi Arabia has emerged as OPEC's leading supporter of measures to boost prices.

    Cash Crunch & Aftermath
    India may need an additional Rs 70,000-1 lakh crore to meet the cash demand of a growing economy and it may take at least two weeks to print that much currency, according to estimates by leading economists. But the current cash shortage in some parts of the country may be overcome sooner as the Reserve Bank of India and banks geared up to plug gaps in cash-supply logistics. Economists suggest that the country needs at least Rs 19.4-20 lakh crore in public hands and ATMs.

    Makes Sense to Let Rupee Weaken a Bit: Ray Farris
    The Rupee is not in a free-fall ans it makes sense to let it weaken a bit, says Ray Farris, Managing Director and the Head of Fixed Income Research and Economics, Asia Pacific Division, at Credit Suisse. Talking to ET Now, Farris says rupee is down about 2.8% year to date. The real exchange rate is still at the upper end of its historical trading range. So, it is not a crisis by any means. It is far from the weakness like say 7% fall on the Turkish Lira or the 6% fall on the Russian Rouble so far this year. In fact, central bank can look at a weakness in the currency in a controlled fashion to adjust against the deterioration in trade balance.

    Gold Price Rally, But Demand Falls Due to Cash Crunch in India
    Demand for physical gold was lower-than-usual during Akshay Tritiya, when buying gold is considered auspicious in India as local prices peaked and a cash crunch curbed retail spending. In the local market, gold prices were nearly 10% higher during the current festival period compared with last year, with prices trading around 31,573 rupees per 10 grams, the highest since August 2016. This is also the highest price levels seen on record for April compared with the previous corresponding periods.The demand across major centres in Asia remained sluggish as benchmark prices hovered close to a two-and-half month high.

    Shiv Sena MP's Bank Asked to Restrict Withdrawals
    Reserve Bank of India has placed Mumbai-based City Co-operative Bank controlled by Shiv Sena MP Anandrao Adsul, under directions restricting withdrawals from the bank accounts to Rs 1000 in every account and banning the bank from granting loans, making investments, borrowing funds and accepting deposits effective from Tuesday evening. The bank has deposits of Rs 500 crore and has advances of Rs 300 crore. It had net NPAs of 8.84% in March 2016, up from 3.49% in March 2013. City Co-operative Bank is in talks with Saraswat Bank for a possible merger.

    US, China Lead World Debt Burden
    As world borrowing levels hit fresh records, the United States and China stand out among the biggest debtors, creating risks to the global economy, the International Monetary Fund said on Wednesday. Mounting government deficits and indebtedness leave countries vulnerable to shocks and hinder their ability to respond should their economies falter. China accounted for 43% of the increase since 2007, according to the fund's Fiscal Monitor report. Meanwhile, the sweeping US tax cuts enacted in December will push US deficit spending to $1 trillion, or 5% of GDP, over the next three years, and boost US debt to nearly 117% by 2023.

    India's Most Trusted Banks?
    In an ironical twist, the TRA Brand Trust Report 2018 reported that ICICI Bank was the most trusted private bank in India. The report, however clarified, the survey was carried out during November-January and did not take into account the recent reports of irregularities at ICICI Bank. The public sector major Punjab National Bank, which witnessed a multi-crore fraud in February, ranked sixth among the public sector banks (PSB) and was 297th in the overall ranking. One saving grace, State Bank of India was named the most trusted bank (both public and private sector) in the country.

    Odisha Creates Land Bank for Industries
    Mineral-rich Odisha, aspiring to become a manufacturing hub in India with downstream metal industries, has "learnt from the Posco experience" and prepared a GIS-based land bank of 121,000 acres for various industries, reports IANS. According to Industries Department Principal Secretary Sanjeev Chopra, 121,000 acres of land bank has already been identified in two categories. Category A is readily available with Odisha Industrial Infrastructure Development Corporation (IDCO) and the category B land is also reserved for industries.

    CORPORATE CORRIDOR

    Fifth Suitor for Fortis: Radiant Lifecare, an emerging Mumbai-based hospital chain that is backed by buyout firm KKR, is set to submit its bid for Fortis Healthcare, the cash-strapped hospital network that is in the middle of a fiercely contested bidding war. While the finer contours of the offer is not known, top industry officials noted that Radiant’s bid will give fair competition to the existing suitors.

    Maruti Leadership: The country’s largest car maker Maruti Suzuki India attained leadership position in utility vehicles sales in the domestic market in 2017-18, with over 27.5% market share. Riding on the success of models like Vitara Brezza, Ertiga and S-Cross, Maruti Suzuki’s sale of utility vehicles reached 253,759 units in 2017-18, growing 29.6% over previous year sales of 195,741 units.

    Lanco Infra, ABG & Alok Ind Face Liquidation? Top officials at leading banks fear that the insolvency resolution process at three companies with dues of about ?1 lakh crore is likely to fail, leading inevitably to liquidation.Lenders are unwilling to accept offers for Lanco Infratech, ABG Shipyard and Alok Industries that involve substantial haircuts over concerns that such deals will lead to investigations and harassment later on and because the bids are close to the liquidation value anyway, reports ET.

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    Top Quote
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    FUNDAMENTALS

    Rupee Slips: The rupee slipped by 2 paise on Wednesday to settle at a fresh seven-month low of 65.66 against the US currency due to sustained dollar demand and forex outflows, extending its fall for a third day amid surging crude prices.

    Bonds Down: Government bonds (G-Secs) slipped on selling pressure from banks and corporates. The 7.17% 10-year benchmark bond maturing in 2028 slipped to Rs 97.49 from Rs 97.81 previously, while its yield gained to 7.54% from 7.49%. The 6.68% G-Secs maturing in 2031 declined to Rs 90.95 from Rs 91.3975, while its yield rose to 7.78% from 7.72%. The 6.79% G-Secs maturing in 2027 went down to Rs 94.1375 from Rs 94.33, while its yield moved up to 7.70% from 7.67%. The 8.15% G-Secs maturing in 2022, the 8.79% G-Secs maturing in 2021 and the 7.94% G-Secs maturing in 2021 were also quoted lower to Rs 102.3850, Rs 104.5075 and Rs 101.95 respectively.

    Call Rates Up: The overnight call money rates finished higher to 5.90% from it's Tuesday's closing level of 5.80%. Its resumed higher to 6.00% and moved in a range of 6.00% and 5.75%.

    Liquidity: The Reserve Bank of India, under the Liquidity Adjustment Facility, purchased securities worth Rs 3,635 crore in 5-bids at the overnight repo operations at a fixed rate of 6.00% as on today, while its sold securities worth Rs 8,859 crore in 37-bids at the overnight reverse repo auction at a fixed rate of 5.75% as on April 17.



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    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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