10 things you need to know before the opening bell on July 1

SUMMARY

Indian benchmark indices are likely to edge higher on Monday following gains in global markets after positive development in US-China trade negotiations. Asian shares advanced after the US and China agreed to restart trade talks and hold new tariffs. At 7.30 AM, the SGX Nifty futures traded 9.5 points, or 0.08 percent, higher at 11,847.50, pointing to a positive start for the Sensex and the Nifty 50.

By CNBC-TV18Jul 1, 2019 7:40:50 AM IST (Updated)

1. Global markets: Stocks rallied and bonds retreated in Asia on Monday as a thaw in the Sino-US trade dispute tempered risks to the global economy, leading investors to pare wagers on aggressive policy easing by the major central banks. Japan's Nikkei jumped 1.62 percent and Topix also gained 1.5 percent. South Korea's Kospi added 0.57 percent. Meanwhile, US markets also surged on Friday ahead of a meeting on trade between Trump and Xi Jinping. The Dow Jones Industrial Average advanced 73.38 points, or 0.28 percent, to 26,599.96, the S&P 500 gained 16.84 points, or 0.58 percent, to 2,941.76 and the Nasdaq Composite added 38.49 points, or 0.8 percent, to close at 8,006.24.

2. Markets At Close On Friday: Market fell on Friday for the second straight day were frontline indices ended near day's low ahead of the highly anticipated meeting between the US President Donald Trump and Chinese President Xi Jinping at G20 Summit over the weekend. The BSE Sensex closed 192 points (0.5 percent) lower at 39,395, while the broader NSE Nifty50 ended lost 53 points (0.45 percent) to 11,789.The rupee closed at Rs 69.02 against the US dollar, 0.07 percent lower on Friday. The dollar index, which measures the U.S. currency against six of its peers, was at 96.3470, up 0.23 percent. Meanwhile, foreign institutional investors (FIIs) sold shares worth Rs 514 crore on a net basis in the cash market, while domestic institutional investors (DIIs) bought shares worth Rs 182 crore.

3. Crude Oil: Oil prices rose more than $1 a barrel on Monday after Russia agreed with Saudi Arabia to extend supply cuts for another six to nine months ahead of an OPEC meeting this week. Front-month Brent crude futures for September touched an intraday high of $66.14 a barrel and were up 89 cents, or 1.4 percent, at $65.63 a barrel by 1117 GMT. US crude futures for August rose 88 cents, or 1.5 percent, to $59.35 a barrel after earlier hitting a peak of $60.10, the highest in over five weeks.

4. US And China At G-20 Meeting: U.S. President Donald Trump said he and his Chinese counterpart Xi Jinping agreed on Saturday that the United States would refrain from raising levies on Chinese imports for now while China would buy more U.S. agricultural products. Both countries agreed to restart trade talks after Trump offered concessions including no new tariffs and an easing of restrictions on tech company Huawei in order to reduce tensions with Beijing.

5. GST Rollout: Kicking off celebration to mark two years of the GST implementation, the finance ministry will on Monday come up with further reforms in the indirect tax system with introduction of new return system, rationalisation of cash ledger system and a single refund-disbursing mechanism, among others. The ministry said it will introduce the new return system on a trial basis from July 1 and on mandatory basis from October 1. (stock image)

6. FPI Capital Infusion: Foreign investors infused a net amount of Rs 10,384 crore into the Indian capital markets in June and remained net buyers for the fifth month in a row on expectations of continued economic reforms. Foreign portfolio investors (FPI) invested a net of Rs 2,272.74 crore in equities and Rs 8,111.80 crore in the debt segment, taking the total net investment to Rs 10,384.54 crore in June, according to the depositories' data.

7. PSU General Insurers: The government may need to shell out close to Rs 13,000 crore to improve the financial health of public sector general insurers before initiating their consolidation, sources said. The government is exploring various consolidation options, including merger of state-owned general insurance companies with New India Assurance, with a view to create synergy and unlock value. The Department of Investment and Public Asset Management (DIPAM), under the Ministry of Finance, is also looking at other options including stake sale in three state-owned insurance firms -- National Insurance Company, Oriental Insurance Company and United India Insurance Company, sources told PTI.

8. Reserve Bank Of India On Banks': The RBI on Friday relaxed the leverage ratio (LR) for banks to help them boost their lending activities. The leverage ratio stands reduced to 4 percent for Domestic Systemically Important Banks (DSIBs) and 3.5 percent for other banks effective from the quarter commencing October 1, 2019, the central bank said in a notification. "Both the capital measure and the exposure measure along with Leverage Ratio are to be disclosed on a quarter-end basis. However, banks must meet the minimum Leverage Ratio requirement at all times," RBI said.

9. Fiscal Deficit: The government's fiscal deficit touched 52 percent of the budget estimate for the full year in the first two months of 2019-20. In absolute terms, the fiscal deficit or gap between expenditure and revenue, was Rs 3,66,157 crore, as per the data released by the Controller General of Accounts (CGA). The fiscal deficit was 55.3 percent of 2018-19 budget estimate in the year-ago period. In the Interim Budget passed in February, the government had estimated the fiscal deficit at Rs 7.03 lakh crore for 2019-20.

10. Viral Acharya On Low Inflation: Outgoing deputy governor of the Reserve Bank of India Viral Acharya credited flexible inflation targeting, low crude prices and efficient food

supply management for successful taming of headline inflation in recent years on Saturday. The RBI shifted to flexible inflation targeting with a headline target of 4 percent(+/- 2 per cent) when the Monetary Policy Committee (MPC) was instituted in 2016.