VRIGHT Exchange — Weekly Review & Preview (Week ending 13 Sep 2025)

Snapshot
Global markets ended the week on a risk-on note amid growing expectations of Fed rate cuts, while India’s equity indices rallied (Nifty > 25,100) even as retail inflation ticked up modestly.

SEBI moved to ease market access for foreign investors and tweak AIF/FPI rules.

Global Economy & Markets — Review
• US Inflation: Consumer prices rose more than expected in August, the largest monthly increase in seven months. Despite this, markets are pricing in potential rate cuts due to softening labor signals. Tech-heavy indices like Nasdaq saw record intraday closes.

Implication: Markets remain sensitive to mixed macro signals — inflation up but growth and labor softening. The Fed’s September decision will be pivotal.

• Market Flows & Sentiment: US equity funds saw net outflows while bond and money-market funds attracted inflows. Tech/AI names continue to support indices.

• Commodities: Crude oil traded in a range, with forecasts suggesting downward pressure into 4Q25 due to inventory builds.

Indian Economy & Markets — Review

• Equity Markets: Nifty closed above 25,100 and Sensex near 81,900, led by autos, metals, and select cyclical sectors. The rupee firmed modestly (~₹88.27/$). Market breadth showed rotation into cyclical/commodity stocks.

• Inflation (CPI): Retail inflation rose to 2.07% YoY in August (from 1.61% in July), still within RBI’s target band, keeping the door open for potential rate easing later.

• FIIs & Flows: Foreign portfolio investors remain net sellers in 2025, a structural headwind for market liquidity. Domestic flows and earnings/outlook will drive near-term direction.

• Regulatory Moves: SEBI eased foreign investor entry, lowered minimum public offering thresholds for very large IPOs, and introduced AIF/FPI compliance relaxations. These moves aim to widen investor access and improve issuance flexibility.

Key Regulatory & Policy Developments

• SEBI Board Decisions: Single-window facilitation for sovereign/overseas retail funds; minimum public sale for very large IPOs reduced from 5% to 2.5%; extended timelines for achieving minimum public float.

• AIF/FPI Updates: Simplified compliance frameworks for FPIs in government securities and AIF co-investment structures.

• RBI / MPC Context: Minutes of the August MPC highlighted tolerance for data-dependent easing but no immediate rate cuts. Upcoming data (IIP, CPI, GST collection) will guide policy moves.

Market Movers — Weekly Heatmap
• Bullish: US tech/AI optimism, Nasdaq records, supportive risk appetite amid rate-cut prospects.

• Bearish: FII selling in India, pockets of inflation in the US, and geopolitical uncertainties maintaining elevated risk premia.

Preview — Next Week Events & Data
1. FOMC Meeting (Sep 16–17, 2025): Fed decision and press conference, market expects a rate cut.

2. US Data: Labor and CPI follow-ups, initial jobless claims — any surprises will shift rate-cut probability and risk appetite.

3. India Data: IIP for August, industrial prints, and other monthly data — will signal growth trends ahead of RBI decisions.

4. SEBI Updates: Implementation notes/FAQs on new investor entry measures — clarifying operational impact on IPOs.

5. Corporate Earnings: Large-cap earnings and guidance (banks, IT, autos) will influence domestic leadership.

Implications & Suggested Readouts

• Equity Investors:

o Short-term: Favor quality cyclical exposures (autos, metals) that benefit from domestic growth signals. Maintain hedges for rate-cut volatility and geopolitical shocks.

o Mid-term: Monitor SEBI IPO changes — small-tranche exposure to very large listings after demand clarity.

• Corporate/IR Teams: Update IPO docs and investor outreach strategies to reflect minimum-float and foreign investor changes. Use targeted communications to newly enabled FPIs/sovereign funds.

• Policy & Research Desks: Track US Fed communications, India CPI/IIP prints, GST flows, and FPI trends as principal drivers of domestic market liquidity.

Quick-Action Watchlist
• Market Alert: Fed meeting live coverage and commentary (Sep 16–17).

• Data Alert: India IIP and CPI releases.

• Regulatory Alert: SEBI circular summary and implementation timeline for IPOs and FPI onboarding.

Investor Takeaways
• Global markets are weighing mixed macro signals, while India’s markets showed resilience on cyclical sector strength.

• Regulatory changes by SEBI are significant for foreign investor flows and upcoming IPOs.

• Key focus for next week: Fed decision, India IIP/CPI prints, corporate earnings, and SEBI implementation updates.

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