Globally, Equity markets continued to fall as Corona Virus spreads its global footprint. Dow Jones tumbled more than 3% to 27,081 levels and FTSE fell nearly 2% to 7,017 levels. On other hand, PBoc has set Yuan stronger reference rate at 7.0126 against 7.0232. Euro has been key beneficiaries of recent risk-off swings as it has been a funding currency. The EUR/USD pair climbed to a two week high levels of 1.0865 levels. It is noteworthy that economic data in Euro-Zone has been tepid and Corona Virus has been spread in Italy and Germany. Thus, EUR/INR can be sold at near 78.10 with stop above 78.52 for a target of 77.20 levels.
On domestic front, RBI has announced next round of LTROs as it will auction INR 50,000 Cr for three years at 5.15%. It is noteworthy that 3 year LTRO received a better response than 1 year LTRO. Moreover, flow of liquidity in 1 year is smoother than 3 year period. Consequently, domestic 10 year G-Sec yield fell to 6.34%. The gains in domestic bond markets were further supported by cheaper oil and global yields. On currency front, USDINR pair is trading 10 paisa lower than yesterday at 71.75 levels. USDINR pair has resistance at 71.90 levels and support at 71.57-71.60 levels. Range for day seen as 71.57-71.90
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