Pramit Brahmbhatt is CEO of Veracity Group
The Rupee continued to trade weak on weekly basis, it posted its third weekly decline in four weeks. In the last four weeks, the Rupee has depreciated by over three per cent. Taking cues from the growing tensions in Iraq, last week he market witnessed selling in the equity markets from both Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs). FIIs sold shares of worth Rs 421 crores and DIIs were net sellers to the tune of Rs 410 crores during last week which weakened the indices for the second consecutive week. Taking cues from this rupee depreciated further. The trading range for the Spot USD/INR pair is expected to be within 59.80 to 60.80.
It is recommended to be cautious and Buy USD/INR (Futures) on dips with appropriate stop loss as overall the Rupee is expected to depreciate further. Pivot Point for the Pair is at 60.11 and below is the Support and Resistance levels.
Last week we saw that the tensions in Iraq created global concern, as conflict within the country had shut down the country's biggest refinery adding to the worries of exports from the key oil producer. OPEC supplies almost 40 per cent of the global oil demand, so any tension in OPEC countries leads to a global concern. India imports 80 percent of its oil requirements so any increase in oil prices will automatically give rise to inflation which is already the biggest hurdle in the growth of India. Last week WTI Crude closed at $ 106.83 which is just below its previous week’s close.
Gold continued to trade positively due to the turmoil in Iraq. Gold has posted its third weekly gain in a row. It has gained over five percent in last three weeks. Gold prices overlooked some of the better than expected U.S economic data and ended at a three month high on a closing basis. Earlier tension in Ukraine supported the yellow metal and now the chaos in Iraq is helping gold to maintain its safe haven status. Gold is heading towards to post its monthly gain and ended the week at $ 1314.