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Daily Newsletter - 18th June 2024

Team Harmoney

Indian markets reopen today after a long weekend and are set to see strong gains in stocks after the US shares surged to another all-time high Monday. Several mega-cap shares in the US surged. Optimism over a resilient economy, improving corporate earnings and the potential start of rate cuts have pushed equities up about 15% this year. Easing inflation and AI fervor also did their bit to boost shares.

Top 3 Leads Today

  • Monsoon rains a fifth below normal so far, raising agricultural concerns.
  • FMCG companies increase prices to maintain margins due to high input costs.
  • China Property Drag Is Getting Worse; Factory Output Disappoints.

Indian Markets

  • Money Markets Minute: The market was closed on Monday in India for Eid-Ul-Adha. The call rate surged to 6.75% last week as advance tax outflow caused tightness.
  • Government Bond Brief: Yields fell last week after lower-than-expected US inflation for May fuelled September rate cut expectations. The 10-year had settled at 6.98%.
  • Corporate Bond Beat: Short-term bond yields had dropped by 3–4bps last week.
  • Forex Flash: The rupee fell against the dollar last week after oscillating in a narrow band.  The currency market was closed on Monday.
  • Stocks Spotlight:  The equity market was closed as well.  Last week, the stocks were up almost 1%.

International Markets

  • US Stocks:  The S&P 500 and Nasdaq indexes hit new highs on Monday due to a rise in technology companies' optimism about artificial intelligence. Apple shares continued its rally after the company announced new AI features that would help iPhone sales.
  • US Treasuries: The benchmark 10-year treasury yield increased by 6 basis points to 4.281% following the release of the New York Fed's Empire State Business Condition Index. The data, which measures manufacturing activity, declined for the seventh consecutive month for June on Monday. However, investors do believe that US growth may be higher than expected.  
  • Dollar: The dollar index, which measures the greenback against a basket of currencies dipped 0.19%. The dollar fell against the euro, amid political instability in Europe. Investors are worried about a eurozone fiscal crisis as the far right and leftist groups gain momentum before France's surprise legislative election.

Events This Week

June 18, Tuesday:

  • Six states to sell ₹95 billion via auction

June 19, Wednesday:

  • EIA to release US crude oil inventory report

June 20, Thursday:

  • Bank of England monetary policy decision

June 21, Friday:

  • RBI to auction ₹330 billion worth of government bonds

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