USD/INR Trading forecasts and signals

AUD/USD: the Australian regulator continues to tighten monetary policyInvestors decided to close long-term deals before the RBA (Reserve Bank of Australia) summit, during which, according to preliminary expectations, officials decided to raise the interest rate by 0.50%, reaching the target level of 1.85%. Commenting on their decision, representatives of the department noted the need to continue tough measures to combat inflation in the future. The Central Bank's expectations allow for a further increase in consumer prices by the end of 2022, updating the 7.5% mark, and next year consumer inflation may be reduced to 4.0%, which will allow in 2024 to return to the required indicator of 2.0-3.0%. The board members also noted strong data on the labor market, which is under pressure from the slowdown in economic growth, which is why the regulator allows a moderate increase in unemployment in 2024 to 4.0%, instead of the current level of 3.5% - the minimum for the last 50 years. Officials did not give an assessment of further actions to tighten monetary policy, only referring to the fact that actions will be taken according to the current situation in the economy.Resistance levels: 0.7000, 0.7050, 0.7100, 0.7150.Support levels: 0.6950, 0.6900, 0.6849, 0.6800.USD/CAD: bulls gained an advantage in the pairThe US currency is moving in an upward trend within the "bullish" momentum formed the day before. The USD/CAD instrument reached the level of 1.2860 with the prospect of further strengthening, updating the maximum on July 28.Market participants focused their attention around statistics on consumer price growth, the rapid strengthening in Q2 of which leaves no doubt that the Central Bank of Canada will go for further tightening of monetary policy already at the meeting on September 7. A month earlier, the regulator had already raised the rate by 1 point, which helped the indicator to approach the 2.5% mark, showing the most significant correction of the last 20 years. According to the results of a study published by the Angus Reid Institute, about 53% of Canadians positively assessed the regulator's strategy to combat inflation, and 75% of respondents note that they will have to refrain from large purchases next year due to the rising cost of goods.Resistance levels: 1.2900, 1.2950, 1.3000, 1.3050.Support levels: 1.2850, 1.2800, 1.2750, 1.2700.Gold PricesThe quotes of the banking metal are trading with a slight increase, within the framework of consolidation at the local maximum of July 5. The instrument reached 1770.00 with the prospect of further strengthening, which will be limited at the upper limits of resistance by the announced publication of the report for July on the US employment market. Preliminary estimates allow for a strong decline in new vacancies opened as a result of the strengthening of the economy – up to 250 thousand from the previous 372 thousand vacancies. The average wage per hour for July may also sink to 4.9% from 5.1%. But the indicator of the number of unemployed will maintain zero dynamics at the level of the previous 3.6% mark. In the event that labor market statistics show results exceeding forecasts, the US Federal Reserve will have a more extensive range of tools for changing monetary policy at the autumn meetings. At the moment, it is predicted that the rate will change at the next meeting in the range of 0.50%-0.25%.Support levels: 1717.0, 1681.0.Resistance levels: 1752.0, 1808.0.Oil Market OverviewDuring the trading session of the Asia-Pacific countries, Brent black gold shows a slight decrease within the bearish momentum, being at the level of 98.60, having updated the local maximum of July 25.Large investors are waiting for the meeting of the OPEC cartel, announced on Wednesday at 12:00 (GMT+2), at which the giants of the producers of raw materials will have the opportunity to make a correction in production volumes. At the present time, the cartel participants are not bound by any agreements to change the level of production, because all the agreements reached earlier have already expired. According to economists, the organization will try to avoid the imbalance in the world market, especially taking into account the instability of the world economy and the lack of stable growth indicators.Resistance levels: 100.00, 102.57, 106.00, 109.00.Support levels: 96.50, 93.34, 91.00, ...

India is one of the fastest growing countries in the world by many indicators, primarily by the dynamics of the parameters of the economy and population. In terms of GDP, India is already the 6th economy in the world at the moment and continues to develop, both due to internal sources of growth and by attracting external investment due to an attractive working environment. All this is accordingly extrapolated to the stock market, which shows impressive results even in the conditions of a global correction.So far, investing in the Indian stock market for an ordinary investor can be considered exotic, but the same thing happened recently with Hong Kong stocks. In this article, we will take a closer look at the stock market of India, study its parameters and structure. Since the stock market is an integral part of the economy of any country, first of all we will study the parameters of the economic development of the region.Economy of IndiaIndia is a country with an emerging economy, therefore, it is characterized by faster growth. Moreover, India's economy shows a stable outstrip of the global average GDP growth, and is currently the fastest growing in the world with an estimated growth of 6.5% in 2022.India's GDPIf we look at the dynamics of India's GDP in comparison with the indicators of some countries, we immediately notice a clear upward trend without significant fluctuations, which cannot be said about most other countries. Thus, the average annual growth rate of India's GDP since 2004 (CAGR) is 9.2%, while in the UK this value is only 1.6%, in Germany - 2.4%. This once again proves the faster growth of emerging economies, in particular, India, which has almost caught up with the UK – the forecast for the GDP of India and the UK for 2022 is $3.3 trillion and $3.4 trillion. accordingly.Currently, India is in 6th place in terms of GDP after the USA, China, Japan, Germany and the UK, but if the achieved growth rates of the region's economy are maintained, India can easily reach 3rd place in the future, overtaking Japan, Germany and the UK.Let's also look at India's GDP growth compared to other countries. This time, let's take strong economies for comparison. In India as a whole, outstripping growth is visible, the exception is the COVID-19.Read more: The world's leading Stock Exchanges and features of their functioningGDP at purchasing power parityAnother key indicator of the economy is GDP at purchasing power parity (PPP), that is, GDP adjusted for the price level in a particular country. This is a more objective and realistic indicator. GDP PPP takes into account the price level in the relevant country and allows you to determine the increase in real volumes of goods and services. There are very interesting data here: China already occupies a leading position, which it will only consolidate in the future (in terms of GDP at current prices, the first place is for the United States), and India is in 4th place and has the greatest potential with the ability to overtake the United States by 2040. If we base on the forecasts of GDP PPP of the international consulting agency Pricewaterhouse Coopers, then by the growth of this indicator over 18 years, India can outpace China by more than 2 times and the United States by more than 3.India shows really impressive results achieved due to the synergy of several factors:A competent economic policy aimed at diverse development and elimination of weak points of the economy.Development of important industries and especially agricultural (2nd place in terms of volume in the world and 17% of GDP). Industry and especially pharmaceuticals, including biotechnologies, are developing with renewed vigor. In this direction, India has become one of the industry leaders in a short period of time.Population is probably the main factor. About 1.4 billion people live in India. people (the population of United States – 301.7 million), many of whom have access to a good education, speak English, and 40-45% of the population are young people under 25. India is also now a leader in outsourcing thanks to cheap labor and competent specialists.If we look at the indicator of foreign trade turnover, we will see a multiple increase in exports of goods from India: since 2000, it has grown 9 times, the key sales markets are the European Union and the United States with shares of 17% and 16%, respectively. Interestingly, only 4% is exported to China. In India, with the development of new industries, production is actively growing, which leads to an increase in exports and greater independence of the region from the global economy, which we already see in the absence of a drop in GDP in crisis years. But for now, the country is still dependent on energy imports.The huge population of India is not only an advantage, but also brings some problems. Thus, there is a large number of poor people in the country, and this is a problem that the government is actively fighting: according to various data, the share of the poor population in India has decreased from 40-50% in 2005-2007 to 10-15% at the moment.India is the second country by population, while by area it is the seventh. Another consequence of the excess population is food shortages and unemployment. But here, too, the state is looking for various ways to solve the problem, trying to avoid the path of China, where the opposite situation has now arisen due to excessive birth control.But often impressive economic results can be crossed out by high inflation.Inflation in IndiaThe average in 2022 was 7%, which in current conditions is not a very high value, but higher than the target value of the Reserve Bank of India (RBI) at 2-6%. For comparison, the current inflation in the US is 8.3%, in the eurozone 9.1%.Read more: How the stock price is formed on the stock exchange: basic principlesStock Exchanges in IndiaThere are quite a few small exchanges in India, but the main and largest of them are 2:National Stock Exchange of India Limited (NSE) is the National Stock Exchange of India. It was founded in 1998 and is currently the largest financial market in India and the 4th trading platform in the world in terms of stock trading volume. The total capitalization is about $3,259 trillion, and securities of 2012 companies are placed on it. The exchange is the main trading platform for companies preparing for listing, and is highly technologically advanced (modern equipment with automated trading, settlement processes, etc.).The main index of the exchange is Nifty 50 with the ticker NIFTY - it includes the largest representatives of the Indian stock market.Bombay Stock Exchange (BSE) is the Bombay Stock Exchange. Founded in 1875 as an Association of Local Shareholders and based in Mumbai. It is one of the largest exchanges in the world with 5,000 companies listed on it and a total capitalization of $3,584 trillion.BSE is the first stock exchange in Asia, it was she who launched the development of the equity capital market in India. The main index is the S&P BSE Sensex (ticker SENSEX), which includes the 30 largest and most actively traded BSE shares. It was formed in 1986 and is the oldest stock index in India.In general, both exchanges are similar to each other, as they work on the same trading mechanism, settlement process and trading hours (from 9:55 to 15:30 Indian time). There is a similarity in the list of traded instruments - almost all major issuers of India are listed on both exchanges.Also, exchanges have a common industry structure. At the same time, unlike the US market, the structure is multilevel – with more detailed details:The macroeconomic sector is the business activity of a company at the macro level.Sector is a more specific sector of the company.Industry – the industry classification of the company.The main industry is a classification at the micro level, indicating the main activity of the company.Interestingly, there are no market makers on the exchanges, and trading is carried out through an open electronic book of limit orders, which makes the market more transparent, but less liquid.Due to the fact that all large companies are listed on both exchanges, the main indices of trading platforms are very strongly correlated with each other.Let's start with the industry structure of the entire stock market of India.  The absolute leadership with a share of 24% is occupied by finance. The rest of the industries are more evenly distributed and do not exceed 10% share, which indicates a good diversification of the market.Read more: What is an IPO: how the company goes on the stock exchangeSectors of the Indian Stock MarketLet's take a closer look at the main index of the Bombay Stock Exchange Sensex, which includes the top 30 companies in India.The average P/E is 34.7 (Nifty has 33.9), which is quite a large value and indicates a revaluation of the Indian market. In general, the Indian stock market has been overvalued for a long time due to the growth of the economy as a whole. Let's look at the top 5 most expensive companies (in terms of capitalization). Their list is the same for the indices of the main trading platforms of India. CompanyIndustryCapitalization, billion $P/EReliance IndOil and gas production201.525.4Tata ConsultInformation Technology138.929.8HDFC BankBanking107.020.7ICICI BankBanking77.921.8Hindu UnileverConsumer Goods 66.8Taking into account the fact that 24% of the market capitalization is occupied by the finance industry, it is logical to see 2 of its representatives in the TOP 5 by capitalization at once - 2 banks. If you look at the structure of the entire index, the financial sector companies are also larger than the rest.It is interesting to compare the profitability of the Indian market in comparison with the main American index (S&P500) and another developing country – Brazil (Bovespa index).Comparison of the profitability of the Indian market in comparison with the S&P500If we take the data after the 2008 crisis, the Indian market is significantly ahead of both the United States and Brazil.Read more: P/E Ratio: what it is needed for and how it is calculatedConclusionThe stock market of India is primarily a story about growth. India's economy is showing the brightest growth among other emerging economies. This growth is expressed by the positive dynamics of financial indicators of companies and forms a corresponding trend in stock market quotations. In 2022, when most markets are under pressure, India continues to show outstripping growth, as a result of which the average P/E of stocks has risen to 34. Of course, this increases the risks of a possible correction, which are already overstated in a developing ...