STATE OF THE MARKETS
SGX Nifty signals a negative start
Nifty futures on Singapore Exchange traded 33.5 points, or 0.20 per cent, lower at 16,346, signaling that Dalal Street was headed for a negative start on Friday.
- Tech View: Nifty50 on Thursday broke above the 16,350 level and formed a bullish candle on the daily scale, suggesting more gains ahead.
- India VIX: The fear gauge eased 3 per cent to 12.37 level on Thursday over its close at 12.71 on Wednesday
Asian stocks traded lower in early trade
Asian stocks opened in the red on Friday as investors weighed gains on Wall Street with worries over rising coronavirus infections in Japan and other countries. MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.62 per cent.
- Japan’s Nikkei slipped 0.03%
- Korea’s Kospi tanked 1.42%
- Australia’s ASX 200 gained 0.52%
- China’s Shanghai shed 0.26%
- Hong Kong’s Hang Seng fell 0.56%
US stocks settle higher
Wall Street stocks finished at fresh records again Thursday after a choppy session as investors weigh data showing an uptick in wholesale prices. The data added to expectations the Federal Reserve will shift course and pull back on its stimulus efforts, starting with a slowdown in the pace of bond buying.
- Dow Jones inched up 0.04% to 35,499.85
- S&P 500 gained 0.30% to 4,460.83
- Nasdaq climbed 0.35% to 14,816.26
Dollar nears four-month high
The dollar held firm on Friday, staying near its highest level in four months against a basket of currencies as investors looked for more hints from the Federal Reserve on its plans to reduce monetary stimulus.
- Dollar index inched up to 92.991
- Euro eased down to $1.1732
- Pound declined to $1.3815
- Yen slipped to 110.42 per dollar
- Yuan steady at 6.4771 against the greenback
Oil price fall for the second day
Oil prices fell for a second day on Friday after the IEA warned that demand growth for crude and its products had slowed sharply as surging cases of COVID-19 worldwide have forced governments to revive restrictions on movement. Brent crude was down 31 cents, or 0.4%, at $71.00 a barrel U.S. crude was off by 33 cents, or 0.5%, at $68.76 a barrel.
DIIs buy shares worth Rs 308 crore
Net-net, foreign portfolio investors (FPIs) turned sellers of domestic stocks to the tune of Rs 212.11 crore, data available with NSE suggested. DIIs were buyers to the tune of 307.75 crore, data suggests.
Q1 earnings today
Oil and Natural Gas Corporation, Grasim Industries, Apollo Hospitals, Indraprastha Gas, Hindustan Aeronautics, Petronet LNG, Indian Railway Finance Corporation, General Insurance Corporation of India, Godrej Industries, Sun TV Network, Bayer Cropsciences, and NHPC are among the companies that will announce quarterly earnings today.
MONEY MARKETS
Rupee: The rupee appreciated by 19 paise to close at 74.25 against the US dollar on Thursday as heavy buying in domestic equities and weakness in the greenback bolstered investor sentiment.
10-year bond: India 10-year bond yield declined 0.16 per cent to 6.23 after trading in 6.22 – 6.24 range.
Call rates: The overnight call money rate weighted average stood at 3.22 per cent, according to RBI data. It moved in a range of 1.90-3.40 per cent.
DATA/EVENTS TO WATCH
- Q1 Earnings: ONGC | Grasim | Apollo Hospitals | IGL
- IN Deposit Growth YoY (5 pm)
- IN Foreign Exchange Reserves (5 pm)
- IN Bank Loan Growth YoY (5 pm)
- EA Balance of Trade JUN (2:30 pm)
- US Export Prices (6 pm)
- US Import Prices (6 pm)
- US Michigan Consumer Sentiment Prel AUG (7:30 pm)
- US Michigan 5 Year Inflation Expectations (7:30 pm)
MACROS
July inflation at 3-month low
Industrial production rose 13.6% in June from a year ago while retail inflation eased to a threemonth low of 5.6% in July, separate data releases on Thursday showed, offering twin gains for the economy that looks to be picking up pace. Sequentially, industrial growth was 5.7% over May though it still hasn’t recovered to pre-pandemic levels. Economists said slowing inflation will calm concerns after having spiked recently and allow the Reserve Bank of India (RBI) to keep growth a priority. The July inflation number will help quell anxiety about when rates need to be raised, said Aditi Nayar, chief economist, ICRA.
Vi to shut shop if AGR ‘errors’ not corrected
Vodafone Idea (Vi) said it is a “travesty of justice” and “inconceivable” that the Supreme Court (SC) has not allowed “errors” in adjusted gross revenue (AGR) calculations to be corrected, a ruling which will cost the cash-strapped telco around ₹25,000 crore and force it to “go under”. In its petition filed on Tuesday to review the July 23 order of the court not allowing correction of alleged errors in the telecom department’s AGR calculations, the struggling telco said it had no intentions to “wriggle out” from paying its AGR dues as mandated by the court.
Sebi sets up panel to bring in T+1 settlement
The Securities and Exchange Board of India ( Sebi) has revived its contentious plan to roll out a faster trade settlement system for domestic listed stocks. The capital markets regulator last week set up a panel comprising officials from exchanges, clearing corporations and depositories to iron out concerns that could impede a smooth shift in the country’s trade settlement mechanism to T+1 — an abbreviation for Trade plus one day —from the existing T+2. A quicker settlement has the potential to increase trade turnover and liquidity.
FMCG survives second Covid wave
The impact of the second wave of Covid-19 on the country’s fast-moving consumer goods (FMCG) market was negligible with sales slipping only 2% sequentially in the April-June quarter, data from market tracker Nielsen shows. In fact, the FMCG market grew 36.9% year on year during the quarter, according to Nielsen data, as companies were better prepared to deal with lockdowns and movement restrictions during the second wave than the first wave.
Growth remains priority for both govt, RBI: FM
Finance minister Nirmala Sitharaman said the economy hasn’t recovered to the extent that the central bank can begin tightening liquidity in the system. Both the government and RBI will continue to prioritise growth, she said. The government was ready to do everything to revive and support the economy, she said, urging India Inc to take more risks. “They (RBI) have not given any indication about wanting to suck out the liquidity that is available there,” she told the Confederation of Indian Industry (CII) annual session on Thursday.
PV sales jump 45% in July
Sales of passenger vehicles rose 45% to 264,442 units last month, albeit on a low base, driven by pent-up demand as more states eased curbs imposed to check the spread of the second wave of the pandemic. As per data available with industry body Society of Indian Automobile Manufacturers (SIAM), as many as 182,779 passenger vehicles were sold in the local market in the year-ago period. The sales numbers for passenger vehicles last month would be even higher at 294,627 units if the wholesale volumes of Tata Motors were included.
