Domestic agri imports rise, US-China trade tensions rattle global equities & heavy FII outflows in May’19

04th May - 10th May

1. Sovereign gold bond investors sitting on 30% returns in four years

May 10, 2019

The First Series of Sovereign Gold Bonds(SGB) were issued in the year 2015 at a price of Rs. 2,684 per gm and the last were issued in February 2019 at a price of Rs. 3,326, with a net appreciation of 23.9%, with additional fixed guaranteed annual interest of 2.75% per year, which was later brought down to 2.5%. In total, SGB investors got 30% returns in four years.

Source: The Asian Age

2. Trade war between US and China may reduce oil demand

May 09, 2019

A trade war between the US and China, which are the largest oil consumers, will have a negative impact on oil demand. The two countries on a combined basis made up 34 percent of the global oil consumption during the first quarter of 2019. The trade war between US and China is also impacting Asian economies and may lead to a global slowdown.

Source: Bloomberg

3. Indian oil meal exports to be affected as US put sanctions on Iran

May 09, 2019

Iran is the third largest importer of Indian soy meal and traders are tense after the US announced another round of sanctions. India exported nearly 5,05,050 tonnes of Soy meal to Iran during FY’19 and 4,82,140 tonnes during FY’18. We expect stress on Soy meal prices and export revenues in the near term as India will be left with an excess of Soy meal in the absence of Iranian buyers if sanctions are implemented fully.

Source: Financial Express

4. US Crude oil inventory drops against market expectations

May 08, 2019

U.S. crude inventories fell 4 million barrels last week against a market expectation of a 1.2 million barrels build. According to an EIA report, crude oil inventories increased build of 9.9 million barrels a week earlier to this. Gasoline inventories dropped by 600,000 barrels for the last week, after a 900,000-barrel increase two weeks ago. Production in the week ending May 3 averaged 10.1 million bpd, versus 9.9 million bpd in the previous week.

Source: Reuters

5. China’s crude imports in April hit a record for the month

May 08, 2019

China’s crude imports in April hit a record for the month at 10.6 million barrels per day (bpd), customs data showed on Wednesday. China is the world’s biggest oil importer and its oil requirements are growing continuously.

Source: Reuters

6. FII outflows continued for the 6th session in May’19

May 10, 2019

Heavy outflow by FII’s is pushing the Indian rupee lower. Selling by FII’s continued in the last week also. Foreign Funds (FII's) sold shares worth Rs. 1,245.14 crores, while Domestic Institutional Investors (DII's) bought shares to the tune of Rs. 1,057.42 crores on 10th May, 2019. In May 2019, FII’s net sold shares worth Rs. 3,998.77 crores, while DII's were net buyers to the tune of Rs. 2,142.39 crores.

Source: Money control

7. Agricultural imports rising on drought like situation

May 09, 2019

Indian imports of agricultural commodities like cotton, maize and edible oil are on the rise this year. Lower yields in a drought-like situation, reduced duties and a price drop in markets abroad are the key reasons behind the projected increase in imports. According to industry experts, India is likely to import 27 lakh bales of cotton this year as against 15 lakh bales a year ago. The imports of palm oil are also projected to jump.

Source:Economic Times

8. Tariff war between US and China pushed global equities lower

May 10, 2019

Global markets have suffered a jolt last week after US President Donald Trump said that the US would raise tariffs on $200 billion of Chinese goods from 10 per cent to 25 per cent and implemented increased tariffs early Friday morning.

Source: Reuters