STATE OF THE MARKETS
SGX Nifty signals a flat start
Nifty futures on the Singapore Exchange traded 12 points, or 0.07 per cent, higher at 17,137.50, signaling that Dalal Street was headed for a muted start on Wednesday.
- Tech View: Nifty50 on Tuesday took out the 17,100 level in style but analysts said the index could take a breather near 17,000 level after seven days of relentless buying.
- India VIX: The fear gauge jumped over 9 per cent to 14.52 level on Tuesday over its close at 13.32 on Monday.
Asian stocks mostly lower in early trade
Asian markets opened mostly lower Wednesday following falls on Wall Street overnight as investors shifted their focus to US employment data. Barring Japan, mostly Asian markets were trading in the red. MSCI’s broadest index of Asia-Pacific shares outside Japan was down by 0.39 per cent.
- Japan’s Nikkei jumped 0.83%
- Korea’s Kospi declined 0.20%
- Australia’s ASX 200 shed 0.60%
- China’s Shanghai slipped 0.03%
- Hong Kong’s Hang Seng fell 0.32%
US stocks ended lower after choppy trade
Wall Street finished marginally lower on Tuesday, although the slightly subdued ending to August failed to detract from a strong monthly performance by its three main indexes, in what is traditionally regarded as a quiet period for equities.
- Dow Jones shed 0.11% to 35,360.73
- S&P 500 declined 0.13% to 4,522.68
- Nasdaq retreated 0.04% to 15,259.24
Dollar nears three weeks low
The dollar traded near its lowest point in nearly three weeks versus major peers on Wednesday, with investors focused on a key US jobs report due on Friday for clues on when the Federal Reserve might begin paring stimulus.
- Dollar index steady at 92.751
- Euro gained to $1.18015
- Pound edged up to $1.3756
- Yen slipped to 110.18 per dollar
- Yuan gained to 6.4626 against the greenback
FPIs buy shares worth Rs 3881 crore
Net-net, foreign portfolio investors (FPIs) turned buyers of domestic stocks to the tune of Rs 3881.16 crore, data available with NSE suggested. DIIs, turned sellers to the tune of 1872.4 crore, data suggests.
Two IPOs to open today
The Rs 1,895.04 crore IPO by diagnostics chain Vijaya Diagnostic Centre will be sold in Rs 522-531 price band while the Rs 570 crore IPO by speciality chemical maker Ami Organics will be sold in Rs 603-610 band. Both the issues will close on Friday, September 3.
MONEY MARKETS
Rupee: The rupee strengthened further by 29 paise to close at a nearly 12-week high of 73.00 against the US dollar on Tuesday, marking its fourth straight session of gain following a firm trend in domestic equities and foreign fund inflows.
10-year bond: India 10-year bond yield eased 0.16 per cent to 6.22 after trading in 6.21 – 6.23 range.
Call rates: The overnight call money rate weighted average stood at 3.21 per cent on Tuesday, according to RBI data. It moved in a range of 1.95-3.40 per cent.
DATA/EVENTS TO WATCH
- IN Markit Manufacturing PMI AUG (10:30 am)
- US Markit Manufacturing PMI Final AUG (7:15 am)
- US Construction Spending MoM JUL (7:30 am)
- EA Unemployment Rate JUL (2:30 pm)
- EA Markit Manufacturing PMI Final AUG (1:30 pm)
- GB Markit/CIPS Manufacturing PMI Final AUG (2 pm)
- GB Nationwide Housing Prices AUG (11:30 am)
- CN Caixin Manufacturing PMI AUG (7:15 am)
- AU GDP Growth Rate QoQ Q2 (7 am)
- AU GDP Capital Expenditure QoQ Q2 (7 am)
MACROS
Q1 GDP grows 20.1% on low base effect
India’s economy expanded at its fastest ever in the June quarter, helped by the low base of the year-earlier record contraction and a strong rebound in manufacturing and construction, data released on Tuesday showed.
Fiscal deficit at 9-year low
Fiscal deficit narrowed to a nine-year low of 21.3% of annual budget estimate as of July end at Rs 3.21 lakh crore, helped by a rise in revenues and decline in non-interest revenue expenditure, official data showed on Tuesday.
13 million plus jabs given in a day
India administered a record 13.1 million Covid vaccines on Tuesday with Bihar alone inoculating over 2.3 million. This is the second instance of daily jabs crossing 10 million in August.
India’s valuation premium at decade-high
The valuation premium of Indian equities compared with emerging market counterparts has risen to a decade high. According to Bloomberg data, the MSCI India index, a measure used by global fund managers to gauge the performance of Indian equities denominated in dollar terms, trades at 80% premium to the MSCI EM index, which represents the emerging market (EM) equities.
Supply chains under stress
Discounts and consumer promotion offers on cars, smartphones, televisions, laptops and refrigerators will be among the lowest ever in the upcoming festive season. Manufacturers expect demand to outstrip supply as they scramble to improve inventory levels amid component shortages and skyrocketing freight rates. Executives of several leading brands said discounts have moderated since July-August and were low even during the Independence Day sales.
Maruti likely to make 60% fewer cars this month
The country’s largest carmaker Maruti Suzuki on Tuesday said production across the company’s facilities in Haryana and at contract manufacturing unit Suzuki Motor Gujarat (SMG) is likely to be 40% of normal levels in September due to chip shortage. Owing to a supply constraint of electronic components due to the shortage of semiconductors, the company expects an adverse impact on vehicle production in September, the company told the bourses.
