Currencies Daily Report

Friday| October 5, 2012

Content
Overview US Dollar Euro GBP JPY Economic Indicators
Overview:

Research Team
Fundamental Team Nalini Rao - Sr. Research Analyst Nalini.rao@angelbroking.com (022) 2921 2000 Extn. 6135 Anish Vyas - Research Associate anish.vyas@angelbroking.com (022) 2921 2000 Extn. 6104

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Currencies Daily Report

Friday| October 5, 2012

Highlights
US Unemployment Claims increased to 367000 in the w/e September. European Minimum Bid Rate remained unchanged at 0.75 percent. UKs Halifax House Price Index (HPI) was at -0.4 percent in September. UK Official Bank Rate also remained unchanged at 0.5 percent. Indian government clears FDI in Insurance and Pension sectors, clears FCRA bill.

Market Highlights (% change)

Last NIFTY SENSEX DJIA S&P FTSE KOSPI BOVESPA NIKKEI Nymex Crude (Nov12) - $/bbl Comex Gold (Dec12) - $/oz Comex Silver(Dec12) $/oz LME Copper (3 month) -$/tonne CRB Index (Industrial) G-Sec -10 yr @7.8% - Yield
5787.6 19058.2 13575.36 1461.4 15511.3 1992.7 58458.0 8824.6 91.71 1794.10 3504.10 8315.00 479.06

as on October 4, 2012 Prev. day

1.0 1.0 0.6 0.7 -0.2 #N/A -0.3 0.9 4.1 0.9 1.2 0.3 0.0

WoW
2.4 2.6 0.7 1.0 0.4 0.2 -3.0 -0.1 -0.2 0.9 1.3 1.3 0.9

MoM
10.5 9.9 2.1 4.0 -1.7 5.9 0.2 1.7 -4.0 5.4 7.4 7.9 1.0

YoY
21.8 20.7 24.1 30.0 4.8 19.6 14.6 5.3 15.1 9.4 15.6 20.2 -6.5

Asian markets are trading in green taking cues from the affirmative statement by the European Central Bank (ECB) President Mario Draghi that the bank is ready to buy bonds once the necessary conditions are met and as investors awaited jobs data from the US economy. The statement by the ECB President eased concerns of the Euro zone regions. US unemployment claims increased by 4,000 to 367,000 in the week ended Sept. 29 as compared to 363000 in the prior week. U.S. factories orders fell 5.2 percent as compared to a rise of 2.8 percent in the month of July. But the fall was lesser than forecasted. (Forecast -6%).

US Dollar Index
US Dollar Index declined 0.8 percent due to upbeat global market sentiments due to positive statement by the ECB that the bank is ready to buy bonds with necessary conditions easing concerns over the debt crisis. This led to rise in the risk appetite and thereby decline in the demand for the low yielding currency that is US Dollar Index (DX). US equities gained on the back of positive economic jobs and services sector data from the nation came better than expected which led to rise in the risk appetite amongst market participants. The Index touched a low of 79.36 and closed at 79.44 in yesterdays session.

99.98

0.0

0.1

0.1

5.2

Source: Reuters

US Dollar (% change)
Last Dollar Index US $ / INR (Spot) US $ / INR Oct12 Futures (NSE) US $ / INR Oct12 Futures (MCX-SX)
79.44 51.74 51.95 51.95

as on October 4, 2012 Prev. day

-0.8 0.9 -0.97 -0.96

WoW
-0.2 2.2 -2.47 -2.49

MoM
-2.0 7.0 -6.92 -6.92

YoY
0.1 -4.6 4.77 4.81

Dollar/INR
The Indian Rupee appreciated by 0.8 percent in the yesterdays trading session. The currency appreciated on the back of government approval for 49 percent Foreign Direct Investment (FDI) in Insurance sector and pension sector along with weakness in the DX. Additionally, rise in risk appetite in the global markets also supported an upside in the currency. Further selling of dollars from exporters and foreign banks also acted as a positive factor for the Indian Rupee. The currency touched an intra-day high of 51.66 and closed at 51.74 on Thursday. For the current month FII inflows totalled at Rs. 2,406.40 crores till 4th October 2012. While year to date basis, net capital inflows stood at Rs. 84,737.10 crores till 4th October 2012. Outlook From the intra-day perspective, we expect Rupee to appreciate due to approval of FDI in insurance and pension sector, clearance of Forward market Commission Regulation Act bill and amendments to the Companies bill, 2011. Further, firmness in the Asian markets along with weakness in the DX will also support appreciation of the rupee.

Source: Reuters

Technical Chart USD/INR

Source: Telequote

Technical Outlook
US Dollar/INR Oct12 (NSE/MCX-SX)

valid for October 5, 2012 Trend Down Support 51.8/51.6 Resistance 52.25/52.5

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Currencies Daily Report

Friday| October 5, 2012

Euro/INR
Euro gained 0.9 percent taking cues from positive statement by the ECB President Mario Draghi that the bank is ready to buy bonds once the necessary conditions which eased concerns over the lingering debt crisis along with weakness in the DX. The currency touched a high of 1.3031 and closed at 1.3017 in yesterdays session. European Minimum Bid Rate remained unchanged at 0.75 percent in the month of October. Outlook In today session, we expect Euro to trade with upward bias on the back of firm global market sentiments and along with weakness in the DX. However, unfavorable economic data from the region is expected to cap sharp appreciation in the currency. Technical Outlook
Trend Euro/INR Oct12 (NSE/MCX-SX) Down 67.05/66.85 67.55/67.8 valid for October 5, 2012 Support Resistance

Euro (% change)
Last Euro /$ (Spot) Euro / INR (Spot) Euro / INR Oct12 Futures (NSE) Euro / INR Oct12 Futures (MCX-SX)
1.3017 67.37 67.19

as on October 4, 2012 Prev. day

0.9 0.1 -0.78

WoW
0.8 1.4 -1.87

MoM
3.1 4.2 -4.36

YoY
-2.5 -2.3 2.73

67.2

-0.74

-1.86

-4.33

2.77

Source: Reuters

Technical Chart Euro

GBP/INR
Source: Telequote

The Pound appreciated by 0.7 percent yesterday taking cues from positive global market sentiments and as the Bank of England left its Asset Purchase and official bank rate unchanged. Additionally, weakness in the DX also supported an upside in the currency. However, unfavorable economic data from the nation restricted sharp appreciation in the currency. It touched an intra-day high of 1.621 and closed at 1.619 on Thursday. UKs Halifax House Price Index (HPI) was at -0.4 percent in September as against a decline of 0.5 percent a month ago. Asset Purchase Facility remained unchanged at 375 billion Pounds in the month of October. Official Bank Rate also remained unchanged at 0.5 percent in the current month. Outlook In the intra-day, we expect Pound to appreciate on the back of upbeat global market sentiments along with weakness in the DX. Technical Outlook
Trend GBP/INR Oct 12 (NSE/MCX-SX) Down valid for October 5, 2012 Support 83.48/83.25 Resistance 84.05/84.4

GBP (% change)
Last $ / GBP (Spot) GBP / INR (Spot) GBP / INR Oct12 Futures (NSE) GBP / INR Oct12 Futures (MCX-SX)
1.619 83.80 83.65

as on October 4, 2012

Prev. day
0.7 0.2 -0.93

WoW
-0.3 2.5 -3.01

MoM
1.6 5.5 -5.54

YoY
4.7 -9.8 9.69

83.67

-0.86

-2.99

-5.50

9.75

Source: Reuters

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Currencies Daily Report

Friday| October 5, 2012

JPY/INR
JPY (% change) The Japanese Yen ended on a flat note in yesterdays trading session anticipating stimulus measures from the policy makers along with rise in risk appetite amongst market participants. This in turn decreased the demand for the low yielding currency. The currency touched a low of 78.71 closed at 78.47 on Thursday. Outlook In todays session, we expect Yen to depreciate on the back of rise in the risk appetite in the global markets which might lead to decline in the demand for the low yielding currency. Technical Outlook
Trend JPY/INR Oct 12 (NSE/MCX-SX) Down valid for October 5, 2012 Support 65.81/65.50 Resistance 66.40/66.80 Last JPY / $ (Spot) JPY / INR (Spot) JPY 100 / INR Oct12 Futures (NSE) JPY 100 / INR Oct12 Futures (MCX-SX)
78.47 0.6592 66.04

as on October 4, 2012 Prev day

0.0 0.9 -1.48

WoW
1.1 3.3 -3.67

MoM
-0.5 6.6 -7.20

YoY
2.2 -2.6 2.11

66.05

-1.45

-3.70

-7.18

2.14

Source: Reuters

Technical Chart JPY

Source: Telequote

Economic Indicators to be released on October 5, 2012

Indicator Bank Holiday Monetary Policy Statement Overnight Call Rate BOJ Press Conference German Factory Orders m/m Non-Farm Employment Change Unemployment Rate Average Hourly Earnings m/m Country China Japan Japan Japan Euro US US US Time (IST) All Day Tentative Tentative Tentative 3:30pm 6:00pm 6:00pm 6:00pm Actual Forecast <0.10% -0.4% 115K 8.2% 0.2% Previous <0.10% 0.5% 96K 8.1% 0.0% Impact High High High Medium High High Medium

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