need2know: Monsoon and 6 other triggers for today's market

While slowdown in the Chinese economy has brought India much plaudits as the world’s fastest growing large economy, Reserve Bank Governor Raghuram Rajan says this is a case of the one-eyed man being the king in the land of the blind. Meanwhile, the Indian weather office’s upbeat monsoon forecast has sparked optimism among market participants. In a poll of leading fund managers, research heads and brokers conducted by ET, most said the Sensex would gain at least 13 per cent by December.

Here’s a look at six triggers that can impact the market which opens after a long weekend today:

Rural consumption beats slowdown: Household consumption of fast-moving consumer goods (FMCG) in rural areas grew at almost double the pace of urban areas in 2015, showing all wasn’t lost in the countryside in a year dominated by slowdown. In 2015, FMCG products’ household consumption in rural India grew at 5.4 per cent over the previous year, according to data shared by market research agency IMRB. During the same period, urban household FMCG consumption grew at only 2.9 per cent year-on-year. A recent ICRA report on the Index of Industrial Production (IIP), which is considered an indirect indicator of consumer demand, says the consumer non-durables segment has been weak over the past few months. It also suggests a favourable monsoon could reverse this trend.

RBI’s foreign reserves with overseas banks more than triple: The amount of foreign exchange reserves that the Reserve Bank of India keeps with overseas banks has more than tripled, signalling that it may be preparing to intervene more effectively in the currency market due to impending volatility because of global factors and the possible exodus of about $30 billion of non-resident Indian deposits. Total funds parked with the overseas branches of foreign banks rose to $13.9 billion in February from $3.5 billion in April last year, according to Reserve Bank of India data posted on its website.

India to boost investment in Iranian oil and gas sectors: India and oil-rich Iran on Sunday decided to significantly expand engagement in their overall ties, particularly in boosting Indian investment in joint ventures in oil and gas sectors in the Persian Gulf nation where foreign investors from major economic powers are rushing in to get early footholds after lifting of nuclear sanctions.

FDI inflows up 37 per cent to $39.32 bn in 2015: Foreign direct investment (FDI) into the country increased by 37 per cent to USD 39.32 billion during 2015. The foreign investment inflows stood at $28.78 billion in 2014, according to data by the Department of Industrial Policy and Promotion (DIPP). Computer hardware and software sector attracted the highest FDI, followed by services, trading business, automobile industry and chemicals. Singapore emerged as the biggest FDI source, followed by Mauritius, US, Netherlands and Japan.

Firms line up public offerings: Twenty-four companies with regulatory approval are waiting to launch their initial public offerings (IPOs). Among these, small finance bank licensee Ujjivan Financial Services Ltd and diagnostics firm Thyrocare Technologies Ltd plan to launch their IPOs in the week beginning 25 April. Six more companies are conducting roadshows for investors and are in advanced stages to launch issues this quarter.

PSBs may face further stress on asset quality, says Moody’s: Flagging “under-recognition” of bad loans by banks as a concern, ratings agency Moody’s said asset quality of the 11 rated PSU banks may face further stress as restructured loans may eventually turn into NPAs. “Banks still have meaningful under-recognition in loans to some large corporate groups, operating primarily in the steel and power sectors. In addition, we expect that around 40% of standard restructured loans would ultimately slip into non-performing loans (NPLs),” Moody’s Investors Service VP (Financial Institutions Group) Alka Anbarasu said.

And in the financial market last week

Rupee down: Snapping its 3-day winning spree against the American currency, the rupee closed 21 paise down to end at 66.64 on fag-end dollar demand from banks and importers despite a sharp rally in domestic equities.

Bonds slip: Government bonds ( G-Secs) slipped on selling pressure from banks and corporates and the call money rates remained lower due to lack of demand from borrowing banks amid adequate liquidity in the banking system. The 7.59 per cent government security maturing in 2026 fell to Rs 101.04 compared to Rs 101.17 previously, while its yield rose to 7.44 per cent from 7.42 per cent. The 7.88 per cent government security maturing in 2030 declined to Rs 101.1050 from Rs 101.49, while its yield moved up to 7.75 per cent from 7.70 per cent.

Call rates lower: Call money rates finished lower at 5.90 per cent from previous level of 6.35 per cent. It opened higher at 6.50 and moved in a wide range of 6.50 and 5.90 per cent. While, 5-days call money rates ended at 6.10 per cent before moving in a range of 6.60 and 5.75 per cent.