RBI COUNTER
* DAILY LAF TENDERS: One set of 1-day reverse repo (at 7.00%) and 1-day repo (at 8.00%). Bids for repo tender may be submitted between 0930 IST and 1030 IST, and reverse repo between 1900 IST and 1930 IST.

MARKETS
Call : Seen opening above RBI's repo rate as demand for funds is likely to remain strong. 1-day call: 8.00-8.60% vs 9.00% Wednesday.
Bonds : May open steady in absence of fresh triggers. Mild profit sales may weigh on prices. 10-year bond yield: 7.84-7.88% vs 7.85% Wednesday.
Rupee : Seen steady to tad up. Asian, US, most European markets shut so trade volumes to be low. Range: 62.8500-63.2000/$1 vs 63.0300/$1 Wednesday.
Stocks: Seen rangebound amid lack of major triggers. Nifty range: 8200-8350, Wednesday-end: 8282.70, up 34.45 points.

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RBI COUNTER

* DAILY LAF TENDERS: One set of 1-day reverse repo (at 7.00%) and 1-day repo (at 8.00%). Bids for repo tender may be submitted between 0930 IST and 1030 IST, and reverse repo between 1900 IST and 1930 IST.

* T-BILL AUCTION: RBI to hold auctions of 80 bln rupees of 91-day T-bills, and 50 bln rupees of 182-day T-bills.

MARKETS

Call  : Seen opening firm around 8.50% as demand for funds is likely to remain strong from banks. One-day call: 8.50% vs 8.20-8.35% Tuesday.

Bonds : To take cues from oil prices, US treasuries. Mild profit sales may weigh. 10-year bond yield: 7.84-7.88% vs 7.87% Tuesday.

Rupee : Seen steady to tad down Wed. To track Asian units, NDF. To trade in thin band amid low volume. Range: 63.30-63.60/$1 vs 63.38/$1 Tuesday.

Stocks: Seen rangebound amid lack of major triggers. Nifty range: 8230-8300, Tuesday-end: 8248.25, up 1.95 points.

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RBI COUNTER
* DAILY LAF TENDERS: One set of 1-day reverse repo (at 7.00%) and 1-day repo (at 8.00%). Bids for repo tender may be submitted between 0930 IST and 1030 IST, and reverse repo between 1900 IST and 1930 IST.
* TERM REPO TENDER: One set of 14-day variable rate term repo for 155 bln rupees. Bids may be submitted between 1100 and 1130 IST.

MARKETS
Call  : May open 20-30 bps above repo rate on demand from banks to meet funding needs. 1-day call: 8.20-8.30% vs 8.20-8.25% Monday.
Bonds : May take opening cues from oil prices, US treasury yields. Seen in narrow range intraday. 10-yr bond yield: 7.90-7.98% vs 7.93% Monday.
Rupee : Seen steady on lack of major cues. Month-end importer dollar buys to weigh. Asian units, NDF eyed. Range: 63.55-63.75/$1 vs 63.66/$1 Monday.
Stocks: Indices seen range bound; government reforms eyed Nifty range: 8200-8300, Monday-end 8246.30, up 45.60 points.

RBI's REPO RATE ON DEMAND

 
RBI COUNTER
* DAILY LAF TENDERS: One set of 1-day reverse repo (at 7.00%) and 1-day repo (at 8.00%). Bids for repo tender may be submitted between 0930 IST and 1030 IST, and reverse repo between 1900 IST and 1930 IST.

MARKETS
Call  : Seen opening tad above RBI's repo rate on demand from banks to meet reserve needs. 1-day call: 8.00-8.15% vs 7.35-7.60% 2-day Saturday.
Bonds : May take cues from crude oil price, US treasuries. 10-year bond yield: 7.94-8.00% vs 7.97% Friday.
Rupee : May open down as dollar firm vs euro. Sell orders by exporters may check sharp fall. Range: 63.45-63.70/$1 vs 63.57/$1 Friday.
Stocks: Seen consolidating; bias bearish; auto cos in focus; Nifty range: 8145 - 8250, Friday-end 8200.70, up 26.60 points.

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RBI COUNTER & MARKETS NEWS

 

RBI COUNTER

* DAILY LAF TENDERS: One set of 3-day reverse repo (at 7.00%) and 3-day repo (at 8.00%). Bids for repo tender may be submitted between 0930 IST and 1030 IST, and for reverse repo between 1900 IST and 1930 IST.

* TERM REPO: One set of 14-day variable rate term repo for 185 bln rupees. Bids may be submitted between 1100 and 1130 IST.

* GILT AUCTIONS: RBI to auction 20 bln rupees of 8.08%, 2022 bond, 60 bln rupees of 8.15%, 2026 bond, 30 bln rupees of 9.20%, 2030 bond, and 30 bln rupees of 8.30%, 2040 bond.

MARKETS

Call  : Seen opening 30-40 bps above RBI's repo rate on demand from banks to meet reserve needs. 3-day call: 8.30-8.40% vs 7.95-8.00% 2-day Wed.

Bonds : Steady as participants likely to stay off big buys before auction. Value buying may support. 10-yr bond yield: 7.91-7.98% vs 7.96% Wed.

Rupee : Seen weak as dollar to remain firm against major units. Dollar sales to check fall. Range: 63.40-63.80/$1 vs 63.51/$1 Wed.

Stocks: Seen opening marginally up, but may remain in thin range. Nifty range: 8150-8280, Wednesday-end 8174.10, down 92.90 points.

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DATA ALERT

> US MBA MORTGAGE APPLICATIONS SURVEY for week ended Dec 19. 1730 IST

> US UNEMPLOYMENT INSURANCE CLAIMS REPORT for wk ended Dec 20. 1900 IST

> US DJ-BTMU BUSINESS BAROMETER for wk ended Dec 13. 2030 IST

> US EIA PETROLEUM STATUS REPORT for wk ended Dec 19. 2100 IST

> US EIA NATURAL GAS STORAGE REPORT for wk ended Dec 19. 2230 IST

RBI COUNTER

* DAILY LAF TENDERS: One set of 2-day reverse repo (at 7.00%) and 2-day repo (at 8.00%). Bids for repo tender may be submitted between 0930 IST and 1030 IST, and for reverse repo between 1900 IST and 1930 IST.

* T-BILL AUCTION: RBI to hold auctions of 80 bln rupees of 91-day T-bills, and 50 bln rupees of 364-day T-bills.

MARKETS

Call  : Seen opening 20-30 bps above RBI's repo rate on demand from banks to meet reserve needs. 2-day call: 8.20-8.30% vs 8.00% 1-day Tuesday.

Bonds : To take cues from oil prices, US treasuries. Players may stay off big bets before holiday Thu. 10-year bond yield: 7.91-7.96% vs 7.92% Tue.

Rupee : To open weak as dollar may strengthen on strong US GDP data. To track Asian units and NDF. Range: 63.2000-63.5500/$1 vs 63.2800/$1 Tue.

Stocks: To remain choppy amid rollovers due to F&O expiry. Nifty range: 8200-8350, Tuesday-end: 8267.00, down 57.00 points.

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Stocks with uptick in rollover activity on the D-2

JSW Steel (JSTL IN): On the D-2, rollovers stand at 61% as against 12% on the D-3.The open interest is currently at ~5.98 mn shares. Long aggression was seen during the day a roll levels moved from ~70bps (profit to short rollers) to ~80bps towards the end.

HDFC Bank (HDFCB IN): Rollovers picked up to ~54% as compared to 28% on D-3.The counter holds an OI of ~42.4mn shares. The stock has been in the news on account of its proposed fund raising plans. Long roll aggression was evident as roll levels were ~100-105bps (profit to short roller).

Reliance Industries (RIL IN): Rollovers picked up to ~45% as compared to 21% on D-3. The counter holds an OI of ~37mn shares. Roll levels (profit to short roller) were ~85-90bps during the day.

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STOCKS

 

STOCKS

    ASIA: Shares of financial companies were the largest gainers. Daiwa Securities Group soared 4% and Sumitomo Mitsui Financial Group was up 3.5%.

    --Nikkei 225: 17485.59 today, up 275.54 points or 1.60% vs Thursday.

    --S&P ASX 200: 5302.50 today, up 91.72 points or 1.76% vs Thursday.

    EUROPE: Shares of Seadrill Ltd, Afren PLC and Aker Solutions ASA rose by 10.6%,8.7% and 9.2% respectively.

    --EURO STOXX: 3051.99 Thursday, up 02.00 points or 0.07% vs Wednesday

    --FTSE 100: 6336.48 Thursday, up 4.65 points or 0.07% vs Wednesday

    US: Further, the fall in the number of Americans filing for first-time unemployment benefits by 6,000 to 289,000 in the week ended Dec 13 boosted sentiment. Stocks of technology and pharmaceutical companies were the lead gainers.

    --DJIA: 17778.15 Thursday, up 421.28 points or 2.43% vs Wednesday

    --S&P 500: 2061.23 Thursday, up 48.34 points or 2.40% vs Wednesday

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INDICATORS ,TENDER & MARKETS

INDICATORS (previous session)

* India Nov trade deficit $16.86 bln vs $9.57 bln year ago.

* Petrol, diesel prices cut by 2 rupees per ltr each.

* Govt source says states mostly agreed on contentious GST issues.

* Source says govt to table GST bill in current Parliament session.

 
RBI COUNTER * DAILY LAF TENDERS: One set of 1-day reverse repo (at 7.00%) and 1-day repo (at 8.00%). Bids for repo tender may be submitted between 0930 IST and 1030 IST, and reverse repo between 1900 IST and 1930 IST.

* TERM REPO TENDER: One set of 14-day variable rate term repo for 155 bln rupees. Bids may be submitted between 1100 and 1130 IST.

MARKETS

Call  : May open 15-20 bps above repo rate on demand for funds to meet advance tax outflows. 1-day call: 8.15-8.20% vs 8.00% Monday.

Bonds : May open steady on lack of fresh cues. Traders likely to stay off big bets ahead of US FOMC meet. 10-yr bond yield: 7.81-7.88% vs 7.83% Mon.

Rupee : Seen down as Nov trade deficit widens. Dollar sales by PSU banks likely for RBI to limit fall. Range: 62.80-63.30/$1 vs 62.94/$1 Monday.

Stocks: Seen rangebound with a negative bias ahead of US FOMC meet outcome. Nifty range: 8150-8280, Monday-end: 8219.60, down 4.50 points.

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RBI COUNTER & MARKETS.

RBI COUNTER
* DAILY LAF TENDERS: One set of 1-day reverse repo (at 7.00%) and 1-day repo (at 8.00%). Bids for repo tender may be submitted between 0930 IST and 1030 IST, and reverse repo between 1900 IST and 1930 IST.

MARKETS
Call  : May open 10-15 bps above RBI repo rate on demand from banks to meet reserve needs. 1-day call: 8.10-8.15% vs 7.85-8.00% 3-day Friday.
Bonds : May open steady as Nov CPI as expected. Weekend oil price, US yield to lend cues. 10-yr bond yield: 7.78-7.83% vs 7.83% Friday.
Rupee : May open steady to tad up on positive CPI data. Asian units, NDF eyed. Range: 62.2000-62.4000/$1 vs 62.2900/$1 Friday.
Stocks: Seen opening weak on disappointing IIP data. Oil and gas cos in focus. Nifty range: 8170-8390, Friday-end: 8224.10, down 68.80 points.

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DAILY LAF / TERM REPO TENDER

RBI COUNTER
* DAILY LAF TENDERS: One set of 3-day reverse repo (at 7.00%) and 3-day repo (at 8.00%). Bids for repo tender may be submitted between 0930 IST and 1030 IST, and for reverse repo between 1900 IST and 1930 IST.
* TERM REPO TENDER: One set of 14-day variable rate term repo for 185 bln rupees. Bids may be submitted between 1100 and 1130 IST.

MARKETS
Call  : To open 5-10 bps above repo rate on demand from banks to meet reserve needs early in session. 3-day call: 8.05-8.10 vs 7.85-7.90% 1-day Thu
Bonds : To take cues from oil prices, US treasury yields. Expected lower Nov CPI to lend positive bias. 10-year bond yield: 7.85-7.90% vs 7.87% Thu.
Rupee : To open dn as dlr's rise vs euro may spur bks' dlr buys. Exporters' dollar sales may cap fall. Range: 62.20-62.60/$1 vs 62.3300/$1 Thu.
Stocks: May open slightly up; trade rangebound ahead of IIP, CPI data. Nifty range: 8250-8380, Thursday-end: 8292.90, down 62.75 points.

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MARKETS UPDATE

MARKETS
Call  : Seen opening 5-10 bps above repo rate on likely demand from banks to meet reserve needs. 1-day call: 7.80-8.20% vs 8.15-8.25% Tue.
Bonds:  To take opening cues from crude oil prices and US Treasury yields. May trade in positive bias in absence of gilt auction this week. 10-year bond yield: 7.88-7.93% vs 7.90% Tuesday
Rupee : To open up as euro's rise vs dlr may prompt banks to sell dollars. Cos' dlr buys to check rise. Range: 61.75-62.00/$1 vs 61.8800/$1 Tue.
Stocks: Set to fall further tracking weak global equities. Nifty range: 8250-8380, Tuesday-end: 8340.70, down 97.55 points.

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STATE DEVELOPMENT LOAN AUCTION

RBI COUNTER

* DAILY LAF TENDERS: One set of 1-day reverse repo (at 7.00%) and 1-day repo (at 8.00%). Bids for repo tender may be submitted between 0930 IST and 1030 IST, and for reverse repo between 1900 IST and 1930 IST.

* TERM REPO: One set of 14-day variable rate term repo for 150 bln rupees. Bids may be submitted between 1100 and 1130 IST.

* STATE DEVELOPMENT LOAN AUCTION: RBI to hold auction of 81.80 bln rupees worth of bonds issued by 10 states--Arunachal Pradesh, Bihar, Maharashtra, Meghalaya, Rajasthan, Tamil Nadu, Telangana, West Bengal, Punjab and Uttar Pradesh.

MARKETS

Call  : Seen opening 5-10 bps above repo rate on likely demand from banks to meet reserve needs. 1-day call: 8.05-8.10% vs 8.00-8.05% Mon.

Bonds : May open steady in absence of fresh cues. To track movement in crude oil prices, US Treasury yld. 10-yr bond yld: 7.88-7.94% vs 8.16% Mon.

Rupee : May open lower as Jul-Sep CAD data may weigh on sentiment. Cos' dlr sales to limit fall. Range: 61.8000-62.1000/$1 vs 61.8350/$1 Mon.

Stocks: Set to open marginally down tracking weakness in global equities. Nifty range: 8350-8480, Monday-end: 8438.25, down 100.05 points.

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MARKET UPDATE

RBI COUNTER
* DAILY LAF TENDERS: One set of 1-day reverse repo (at 7.00%) and 1-day repo (at 8.00%). Bids for repo tender may be submitted between 0930 IST and 1030 IST, and reverse repo between 1900 IST and 1930 IST.

MARKETS
Call: Seen opening tad over the repo rate as banks may borrow for indirect tax outflow. May ease intraday. 1-day Call: 7.95-8.15% vs 8.25% 2-day Sat.
Bonds : To take cues from US jobs data on Mon. Hope of fall in Nov CPI may support prices. 10-yr bond yld: 7.90-7.95% vs 7.93% Fri.
Rupee : To take cues from US non-farm payrolls report Mon. Local shares to lend cues. Range: 61.70-62.20/$1 vs 61.77 Fri.
Stocks: Seen opening flat to marginally up. To remain rangebound. Nifty range: 8480-8580, Friday-end: 8538.30, down 26.10 points.

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Highlights of RBI's 5th Bi-Monthly Monetary Policy Statement for 2014-15

MAIN HIGHLIGHTS
* Keeps repo rate unchanged at 8%
* Keeps CRR unchanged at 4% *
*To continue to provide liquidity via term repos
* Continue with overnight repos at 0.25% of bank-wise NDTL
* Continue with 7-, 14-day repos of up to 0.75% NDTL
* Reverse repo remains unchanged at 7%
* MSF, bank rate remains unch at 9%
* To continue with daily one day repo, reverse repos
* Any change in current monetary policy stance "premature"
* Monetary policy stance can change early next year
* Policy stance can change outside policy review cycle
* Policy stance change at current juncture premature
* Monetary conditions, rather than long-term yld view, key to OMO
* RBI to detail 6th bi-monthly monetary policy statement Feb 3
* In talks with govt on new monetary policy framework
* Stronger the information, sooner the policy accommodation
* Conducted OMOs based on assessment of monetary conditions
* Conducted OMO sales worth 401 bln rupees so far Oct-Dec
INFLATION 
* RBI revises central forecast for CPI inflation to 6% for Mar 2015
* Stance change can be outside review cycle
* Nov inflation expected to show further softening
* Inflation is expected to retain some momentum over 12 mos
* Risks to Jan 2016 6% CPI aim evenly balanced
* Expect Dec CPI inflation to rise above current level
* Expect Dec CPI inflation to rise above current level
* "Durability of upturn" in inflation key uncertainty
* March 2015 CPI inflation forecast cut to 6%
* Change in policy stance likely next year if inflation eases
* Headline inflation has been receding steadily
* Favourable base effect will likely dissipate after Nov
* Dec inflation may well rise above current levels
* Uncertainty about evolution of base effect in inflation