Markets

SGX Nifty up 110 points; here’s what changed for market while you were sleeping

Global cues are mixed to negative on Monday morning, but Nifty futures trading in Singapore hinted at a gap-up start for domestic stocks. Whether such gains will sustain remains to be seen, as the index has been witnessing selloff at higher levels these days. Here’s breaking down the pre-market actions.

STATE OF THE MARKETS
SGX Nifty signals a gap-up start
Nifty futures on the Singapore Exchange traded 107.5 points, or 0.96 per cent, higher at 11,285.50, in signs that Dalal Street was headed for a positive start on Monday.

Tech View: Nifty forms Bearish Engulfing pattern
After facing resistance in the 11,300-11,350 zone for the last four sessions, NSE benchmark Nifty50 finally gave up on Friday. During the process, the index formed a big bearish candle, or large bearish engulfing kind of candle, on the daily chart after making repetitive indecisive candles in the past few sessions. Analysts on Dalal Street believe the upside may remain capped in the coming sessions.

Asian shares pause near highs
Asian shares dozed near recent highs in quiet trade on Monday as investors waited to see if the recent sell-off in longer-dated U.S. Treasuries would extend, and maybe take some pressure off the beleaguered dollar. MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.02 per cent lower at 562, but still eyeing the January top of 574.52. Japan’s Nikkei225 dipped 0.4 per cent after touching a six-month peak on Friday.

Oil prices rise in early trade
Oil prices climbed higher on Monday, lifted by China’s plans to ship in large volumes of US crude in August and September, outweighing concerns over a slowdown in demand recovery after the COVID-19 pandemic and an uptick in supplies. Brent crude rose 21 cents, or 0.5 per cent, to $ 45.01 a barrel while US WTI crude was up 27 cents, or 0.6 per cent, to $ 42.28 a barrel.

US stocks settled mixed on Friday
Wall Street’s major averages closed mixed after data showed US retail sales in July increased less than expected. On Friday, the Dow Jones Industrial Average rose 34.30 points, or 0.12 per cent, to 27,931.02. The S&P500 index declined 0.58 points, or 0.02 per cent, to 3,372.85. The Nasdaq Composite index fell 23.20 points, or 0.21 per cent, to 11,019.30.

Q1 results today
Can Fin Homes, Petronet LNG, Lux Industries, HFCL, Scooters India, Suven Pharma, Sical Logistics and Orient Paper are among companies which are scheduled to report their quarterly results today.

DIIs sell Rs 797 cr worth of stocks
Net-net, foreign portfolio investors (FPIs) were buyers of domestic stocks to the tune of Rs 46 crore, data available with NSE suggested. DIIs were net sellers to the tune of Rs 797 crore, data suggests.

MONEY MARKETS
Rupee: The rupee on Friday slid 6 paise to end at 74.90 against the US dollar as data showing slow economic recovery and higher inflation dampened forex market sentiment.

10-year bonds: India 10-year bond yield rose 1.19 per cent to 5.96 after trading in 5.93-5.99 range.

Call rates: The overnight call money rate weighted average stood at 3.44 per cent, according to RBI data. It moved in a range of 1.80-4.10 per cent.

MACROS
Japan economy shrinks at record pace… Japan’s economy shrank at an annual rate of 27.8 per cent in April-June, the worst contraction on record, as the COVID-19 pandemic slammed consumption and trade, according to government data released Monday. The Cabinet Office reported that Japan’s preliminary seasonally adjusted real gross domestic product, or GDP, the sum of a nation’s goods and services, fell 7.8 per cent quarter on quarter.

PBOC injects $ 100 billion of MLF loans… China’s central bank on Monday rolled over maturing medium-term loans while keeping borrowing costs unchanged for the fourth straight month. The People’s Bank of China (PBOC) said in a statement it was keeping the rate on 700 billion yuan ($ 100.74 billion) worth of one-year medium-term lending facility (MLF) loans to financial institutions steady at 2.95 per cent from previous operations.

SC AGR hearing today… Telecom companies such as Bharti Airtel, Vodafone Idea, Reliance Communications will be in focus as the next Supreme Court hearing of the adjusted gross revenues (AGR) case for telcos is scheduled for Monday. SC, in its hearing on August 14 directed telcos under insolvency to submit details of spectrum sharing agreements that they have entered into.

RBI weighs slowing dollar buying… RBI’s central board meeting last week weighed if it should keep amassing forex reserves or start buying more gold. Some of the board members said the recent build-up of reserves has created adequate cover and the cost of buying more dollars may outweigh the gains from an overflowing reserves chest. A few board members felt there was probably a need to diversify the allocation of reserves more in favour of gold

Banks may offer some home loan rejig… Lenders, including State Bank of India (SBI), are working on restructuring options for home loans where the overall tenure of the loan does not extend by more than two years, even after relaxing the repayment schedule. The options include allowing EMI deferment for a few months in cases where the borrower has suffered total loss of income or allowing step-up EMIs, with a lower payout for a couple of years to make up for a reduction in salary or loss of income due to the pandemic.

General insurers log solid growth… The general insurance industry has posted 18 per cent year-on-year growth at Rs 17,011 crore in July, compared with the year-ago period. The industry has seen premiums of Rs 56,340 crore till July — a recovery to pre-Covid levels. This growth has been driven by fire, crop and health insurance.

E-comm firms forecast mega festive sales… India’s two biggest ecommerce marketplaces, Amazon and Walmart-owned Flipkart, expect this year’s festival-season business in smartphones, television sets, refrigerators, washing machines and apparel to nearly double for some categories and increase at least 40% in others, top industry executives told ET. The platforms have accordingly asked sellers to place large orders with the respective brands.

Diesel sales drop by one-fifth in Aug… Diesel sales dropped by a fifth in the first half of August compared with a month ago, indicating that extended regional lockdowns, sluggish economic recovery and high prices are blocking full revival of fuel demand. Demand for diesel slipped 19% while that for petrol gained 2% during August first half compared with the same period in July, according to the provisional sales data of state-run oil companies

NCR realty fails to look up… The National Capital Region (NCR)’s real estate has lost its sheen — the region now contributes just 9% of sales to overall cities’ tally, selling a tenth of its peak numbers while other cities including Mumbai, Bengaluru and Pune are now two-three times bigger, surging both in terms of sales as well as investor return, according to a study by Knight Frank that analysed data of first half of 10 years of top eight cities.

Trade balance in deficit again, but rupee safe… India’s trade balance may have slipped back into deficit, but it may not get out of hand and hurt the rupee as it did in the past. Analysts expect the current account to be in surplus in the current fiscal year due to factors such as low crude oil prices as well as tepid demand for gold.

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