Indian FX/Debt Factors to Look for on Feb 1

GLOBAL MARKETS ROUNDUP

    * Asian shares wiped earlier gains on Friday as a tepid Chinese manufacturing report dented sentiment, leaving investors

on tenterhooks ahead of U.S. nonfarm payroll data due at 1330 GMT. 

    * The yen plumbed fresh multi-year lows against its G3 peers on Friday, having posted its biggest monthly decline in 12 years


    					

            					

                					
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versus the euro as the market positioned for more aggressive easing from the Bank of Japan. 

    * Brent crude oil futures rose to three-month highs on Thursday, widening its premium over U.S. crude, concerns about

rising crude stockpiles in the U.S. Midwest prompted heavy trading based on the spread between the two benchmarks. 

    *  U.S. Treasuries were little changed in Asia on Friday, with all eyes on the jobs report due later in the day as

investors seek to gauge the speed of recovery in the U.S. job market, which holds the key to the U.S. monetary policy outlook.

 

       

    LOCAL MARKETS PREVIOUS CLOSE 

    * BSE index 19,894.98 (-0.55)

    * NSE index 6,034.75 (-0.35)

    * Rupee 53.2150/2250 per dollar (53.30/31)

    * 10-year bond yield 7.91 pct (7.89 pct) 

    * 5-year OIS rate 7.26 pct (7.25 pct) 

    * 1-year OIS rate 7.63 pct (7.62 pct) 

    * Call money 7.75/7.85 pct (7.75/7.85 pct)

    

    FACTORS TO WATCH

    * Manufacturing PMI for January to be released at 0500 GMT.

    * Montek Singh Ahluwalia, deputy chairman of the Planning Commission of India will be speaking at  a conference on

agriculture sector at 0930 GMT.

    

    OVERNIGHT NEWS

    * India's finance minister is putting welfare, defence and road projects on the chopping block in a last-ditch attempt to

hit a tough fiscal deficit target by March, risking short-term economic growth and angering cabinet colleagues. 

    * Indian banks' credit to industry grew at a slower pace in December, compared with the year-ago period, the Reserve Bank of

India (RBI) said on Thursday. 

    * The possibility of India losing its investment-grade credit rating has receded somewhat as a result of economic

reforms undertaken by the government since last September, an analyst with rating agency Standard & Poor's told Reuters on

Thursday. 

    * India's central bank tightened rules on Thursday governing how banks and other financial institutions provision for

restructured loans, based on the recommendations of a panel.

 

         

    MAJOR DEALS/ACQUISITIONS

    * India's ONGC Videsh Ltd (OVL), a unit of explorer Oil and Natural Gas Corp, will launch its first overseas bond

issue in February to raise about $900 million to fund an acquisition in Azerbaijan. 

    * Abu Dhabi's Etihad Airways is in talks with India's Jet Airways for a potential investment in the Indian

carrier, India's Civil Aviation Minister Ajit Singh said on Thursday, without giving any details of the possible deal.

 

   Jet expects to finalise a stake sale deal with Etihad "in a week or so", an executive at the carrier, who declined to be

named said. 

    * India's DLF Ltd said on Thursday it would sell part of its wind power assets with a capacity of 150 megawatts

to Bharat Light and Power Pvt Ltd for 2.82 billion rupees ($52.8 million) as part of its plans to reduce debt. 

      

    USD/INR NDFs (NY closing prices)    

    * For up-to-date prices, double click   

      Close      Open      High     Low      Volume   

    53.47-52    53.45     53.53    53.39      High

     

    FII INVESTMENTS-EQUITIES (Net dollars)                      

                        

    Jan. 31*                 $180.25 mln#

    Month-to-date**            $4.06 bln 

    Year-to-date**             $4.06 bln         

    * Provisional NSE data         

    ** Source: Data as per custodial filing as on Jan. 31 on

SEBI website.

    #(As per Reuters conversion, $1 = 53.20 rupees)     

             

    FII INVESTMENTS-DEBT (Net Dollars)  *  

                              Debt             

    Jan. 30               -$57.98 mln

    Month-to-date         $551.08 mln

    Year-to-date          $551.10 mln                    

    * Source: Data as per custodial filing as on Jan. 31 on SEBI website.

        

    GOVERNMENT SECURITIES TRADING (Net buy/sell, in rupees)

                                Jan. 31

    Foreign Banks                       -7.45 bln

    Public Sector Banks                  7.42 bln

    Private Sector Banks                -3.70 bln

    Mutual Funds                         5.74 bln 

    Others                               3.17 bln

    Primary Dealers                     -5.19 bln

    Source: Clearing Corp of India Ltd

    

    ISSUANCES

Instrument          Amount              Date

Dated bonds       120 bln rupees       Feb. 1

    

    LIQUIDITY

    * The RBI said on Thursday it accepted all 41 bids for 1.04 trillion rupees at its one-day repo auction, through which it

injects cash into the banking system. It said it also accepted the sole bid for 50 million rupees at its reverse repo auction,

through which it absorbs cash from the system. 

    * Indian banks' refinancing with RBI falls to 201.99 billion rupees. 

    * Indian banks' cash balances with RBI steady at 3.12 trillion rupees.