STATE OF THE MARKETS
SGX Nifty signals a negative start
Nifty futures on the Singapore Exchange traded 77 points, or 0.51 per cent, lower at 15,083, signaling that Dalal Street was headed for a negative start on Wednesday.
Tech View: Nifty50 eyes 15,300 level
Nifty50 on Tuesday broke above a key resistance of 15,100 level on a closing basis. The index formed a small bullish candle on the daily chart. It was the second straight session when the index made a higher high-low formation. Even as the index traded above the moving averages, analysts see a good possibility of it touching the 15,300 level and even all-time highs.
Asian markets look weak
Asian stocks tracked overnight US declines on Wednesday as concern about faster inflation shadowed the economic recovery from the pandemic.
- Japan’s Topix index retreated 0.9%
- Australia’s S&P/ASX 200 index fell 1.6%
- Markets are closed in Hong Kong and South Korea for holidays.
Wall Street slipped overnight
US stocks slipped overnight, as investors retreated from shares of companies closely tied to the economy.
- Dow Jones Industrial Average fell 267.13 points, or 0.8%;
- S&P 500 slid 35.46 points, or 0.9%,
- Nasdaq declined 75.41 points, or 0.6%.
Dollar gets sinking feeling
The dollar dipped for the fourth session and slipped near the lowest level this year.
- The yen was at 108.95 per dollar
- The offshore yuan traded at 6.4249 per dollar
- The Bloomberg Dollar Spot Index was steady after falling 0.3%
- The euro was at $1.2225
Gold begins to shine
In international markets, gold traded at $1,868.60 an ounce on Wednesday. Domestic gold and silver prices moved on a mixed note on Tuesday.
- gold futures for June 4 delivery slipped 0.27 per cent (or Rs 133) to Rs 48,341 per 10 gm
- MCX silver for July 5 delivery rose 0.64 per cent (or Rs 466) to Rs 73,790 a kg
SUUTI to sell shares in Axis Bank via OFS
The Specified Undertaking of the Unit Trust of India (SUUTI) has offered to sell nearly 2 per cent stake in Axis Bank through offer for sale (OFS). SUUTI may sell up to 5.8 crore shares at the floor price of Rs 680 per share, and this will help the government raise up to Rs 3,949.34 crore.
Q4 earnings today
Indian Oil Corporation,
, IRFC, JK Tyres & Industries, Heritage Foods, Tanla Platforms, Prism Johnson, Mas Financial Services, TCI Express, Indo Rama Synthetics, Man Infra, Gravitas India and SML Isuzu are among companies that will announce their March quarter results today.
FPIs buy Rs 618 crore worth shares
Net-net, foreign portfolio investors (FPIs) turned buyers of domestic stocks to the tune of Rs 618.49 crore, data available with NSE suggested. DIIs, turned buyers to the tune of Rs 449.52 crore, data suggests.
MONEY MARKETS
Rupee: The rupee rose by 17 paise to close at a seven-week high of 73.05 against the US dollar on Tuesday, extending its gaining streak to the third straight session on positive domestic equities and weakening of the American currency in the overseas markets.
10-year bonds: India 10-year bond yield edged up 0.07 per cent to 5.98 after trading in 5.97 -5.98 range.
Call rates: The overnight call money rate weighted average stood at 3.15 per cent, according to RBI data. It moved in a range of 1.90-3.45 per cent.
DATA/EVENTS TO WATCH
Q4 Earnings: Indiabulls Housing | IOC | JK Tyre
Japan Industrial Production MoM Final March (10:00 am)
EU New Car Registrations YoY April (11:30 am)
UK Inflation Rate YoY April (11:30 am)
ECB Financial Stability Review (01:30 pm)
Euro Area Core Inflation Rate YoY Final April (02:30 pm)
US FOMC Minutes (11:30 pm)
MACROS
RBI steps up bond buying
RBI has stepped up sovereign bond purchases in the past two weeks to help lower borrowing costs, signalling its commitment to go beyond announced plans as growth revival temporarily trumps inflation management at Mint Road. The central bank net purchased Rs 34,175 crore of sovereign papers between April 22 and May 4 from the secondary market to ensure lower borrowing costs amid concerns that the second Covid wave would derail the nascent economic recovery.
WPI spike to show up in CPI too
The sharp spike in the wholesale price index in April is likely to spill over to retail inflation with a lag, but a normal monsoon and lower food inflation may moderate the impact, economists said. Retail inflation is expected to remain in the 5-5.5% range in the near term but could pick up toward the end of the financial year, they said. The meteorological department has forecast a normal monsoon this year.
China bans crypto transactions
China has banned financial institutions and payment companies from providing services related to cryptocurrency transactions, and warned investors against speculative crypto trading. Under the ban, such institutions, including banks and online payments channels, must not offer clients any service involving cryptocurrency, such as registration, trading, clearing and settlement, three industry bodies said in a joint statement on Tuesday.
Mitsui arm sues govt over retro tax
The government is facing a fresh international challenge to the policy of retrospective tax amendments adopted by it. Now Earlyguard, a British subsidiary of Japanese conglomerate Mitsui & Co, has commenced arbitration under the India-UK Bilateral Investment Treaty after income tax authorities raised a Rs 2,400 crore demand related to a transaction that took place in 2007.
MF investors turn to flexicap funds
Investors are preferring flexi-cap mutual fund schemes to multi-cap offerings in a volatile market, Amfi data suggests. In the past two months, flexi-cap schemes generated an inflow of Rs 1,646 crore while multicap schemes had an outflow of Rs 349 crore. This shift in fund flows has occurred after the regulator Sebi’s deadline of January 31, 2021 to rename and change the investment strategy of multicap schemes.
