need2know: Six market-moving macro triggers to watch today

Prime Minister Narendra Modi on Wednesday confirmed that next year’s Union budget will be presented around 1 February.

He implicitly disclosed the dates, while exhorting the state governments to advance their budget schedule, too, so that they are aligned with the Union budget.


Here's a look at six macro triggers for the market today

Government okays plan to exit sick PSUs: The government on Thursday approved an ambitious plan to sell loss-making state-owned companies, subsidiaries and select manufacturing plants to strategic buyers, setting the stage for the return of privatisation after more than a decade. The companies approved for strategic sale or privatisation include Scooters India, Pawan Hans, Hindustan Newsprint and units of Cement Corporation of India. A decision to sell four steel plants of NMDC and Steel Authority of India and merge three state-owned companies with their public sector counterparts was also taken.

Centre approves 2% hike in DA: Ahead of Diwali, the Centre on Thursday approved 2% dearness allowance and relief benefitting about 50.68 lakh employees and 54.24 lakh pensioners. The decision to provide 2% DA on basic pay was taken by the Union Cabinet and will be effective from July 1, 2016.

IT spend of banking, securities firms to hit $7.8 bn: IT spending by banking and securities firms in India is estimated to touch $7.8 billion in 2017, an 8.6% jump from 2016, technology research firm Gartner said on Thursday. IT services and software will both be the fastest growing segments at 12.6% in 2017, as firms in the banking and securities industry invest more in applications and business processes, specifically in business process outsourcing," the report said.

Stock limit on sugar extended by 6 months: The Union Cabinet on Wednesday approved extending the stock limit on sugar by six months till April 2017, a government release said. This will enable the state governments to ensure sugar availability and control prices. In April, the government had fixed a stock limit of 500 tonne and turnover limit of 30 days for sugar traders in the country--other than those in West Bengal.

India may cut tariff concessions on Chinese goods: India is expected to push for a new approach to tariff cuts at the 16-country trade bloc to prevent China from flooding its market with cheap goods. The commerce department is working on ways to give minimum tariff concessions to Chinese goods and delay the concessions by a long number of years even as it allows imports from other member countries at lower duties.

UMPPs may be insulated from swings in fuel cost: New ultra mega power projects (UMPPs) based on imported coal may be insulated from uncertainties in fuel costs, with the power ministry deciding to factor in indexed imported coal prices into tariff for such plants. The ministry has agreed to use an index of prices of imported coal from Indonesia, South Africa and other coal exporting countries for calculation of electricity tariff from such plants, a government official said.

...and in financial markets yesterday

Rupee down: The rupee lay low for the second session as it weakened 10 paise to 66.93 against the dollar on Thursday as the latter rose overseas amid a lower opening in domestic stocks.

Bonds slip: Government bonds (G-Secs) slipped on selling pressure from banks and corporates. The 7.59% G-Secs maturing in 2026 slid to Rs 104.71 from Rs 104.8275 previously, while its yield went-up to 6.89% from 6.87%. The 7.61% G-Secs maturing in 2030 fell to Rs 105.2675 from Rs 105.43, while its yield edged up to 7.00% from 6.98%.The 7.88% G-Secs maturing in 2030 dipped to Rs 107.2050 from Rs 107.33, while its yield inched up to 7.04% from 7.03%. The 7.59% G-Secs maturing in 2029, the 7.68% G-Secs maturing in 2023 and the 6.97% G-Secs maturing in 2026 also quoted lower at Rs 104.67, Rs 104.61 and Rs 101.27 respectively.

Call rates up: The overnight call money rates finished higher at 6.25% from Wednesday's level 5.95%. It resumed higher at 6.35% and moved in a range 6.35% and 6.10%.

Liquidity: the Reserve Bank of India (RBI), under the Liquidity Adjustment Facility (LAF), purchased securities worth Rs 3745 crore in a 7-bids at the overnight repo auction at a fixed rate of 6.25% as on today, while its sold securities worth Rs 9638 crore from 34-bids at the overnight reverse repo auction at a fixed rate of 5.75% as on October 26.