Nifty today: SGX Nifty up 90 points; here’s what changed for market while you were sleeping
STATE OF THE MARKETS
SGX Nifty signals a positive start
Nifty futures on the Singapore Exchange traded 88.5 points, or 0.56 per cent, higher at 15,986.50, signaling that Dalal Street was headed for a positive start on Monday.
- Tech View: Nifty50 snapped a four-day losing streak on Friday and formed a trend reversal ‘Hammer’ candle on the daily chart. Analysts see recovery ahead.
- India VIX: The fear gauge eased 6 per cent to 12.09 level on Friday over its close at 12.84 on Thursday.
Asian markets mixed in early trade
Asian stocks opened mixed on Monday with investors seeking new cues after a solid US jobs report lifted Wall Street shares to record highs last week. MSCI’s broadest index of Asia-Pacific shares outside Japan was up by 0.21 per cent.
- Japan’s Nikkei shed 0.51%
- Korea’s Kospi climbed 0.40%
- Australia’s ASX 200 gained 0.27%
- China’s Shanghai Composite rose 0.11%
- Hong Kong’s Hang Seng declined 0.18%
US shares ended higher on Friday
Wall Street scaled new highs on Friday, with the S&P500 index closing up for a seventh straight day, after jobs data for June showed robust hiring yet persistent weakness in the labor market that will keep the Federal Reserve from raising interest rates any time soon. US stock markets will remain closed on Monday on the account of Independence Day.
- Dow Jones gained 0.44% to 34,786.35
- S&P 500 advanced 0.75% to 4,352.34
- Nasdaq climbed 0.81% to 14,639.33
Dollar takes a breather
The dollar took a breather on Monday after recent gains ran into a speed bump when details of last week’s US jobs report soothed jitters about the timing of US interest rate hikes. Minutes from that June meeting are due to be published on Wednesday and might have more details on policymakers’ thinking.
- Dollar index inched down to 92.33
- Euro steady at $1.1859
- Pound edged to 1.3825
- Yen gained to 111.15 per dollar
- Yuan stands at 6.46 against the greenback
FPIs sell shares worth Rs 983 cr
Net-net, foreign portfolio investors (FPIs) turned sellers of domestic stocks to the tune of Rs 982.8 crore, data available with NSE suggested. DIIs, turned buyers to the tune of Rs 930.39 crore, data suggests.
India Pesticides listing
The agrochemical player India Pesticides will make its debut on Monday. The 800 crores issue of the company was open for subscription between 23-25 July. The issue was 29 times, thanks to a high demand of the stock between QIBs and HNIs.
MONEY MARKETS
Rupee: The rupee declined by 19 paise to close at a 14-week low of 74.74 against the US currency on Friday as a firm dollar and expectations of further spike in crude oil prices weighed on investor sentiment.
10-year bond: India 10-year bond yield jumped 0.43 per cent to 6.06 after trading in 6.05 – 6.08 range.
Call rates: The overnight call money rate weighted average stood at 3.12 per cent, according to RBI data. It moved in a range of 1.90-3.40 per cent.
DATA/EVENTS TO WATCH
- India Markit Services PMI June (10:30 am)
- India Markit Composite PMI June (10:30 am)
- China Caixin Services PMI June (07:15 am)
- China Caixin Composite PMI June (07:15 am)
- Euro Area Markit Services PMI Final June (01:30 pm)
- UK New Car Sales YoY June (01:30 pm)
- ECB President Lagarde Speech (02:30 pm)
MACROS
Saudi-UAE Opec standoff worsens
Saudi Arabia and the UAE cranked up the tension in their Opec standoff as the rare diplomatic spat between long-time allies leaves the global economy guessing how much oil it will get next month. The bitter clash has forced OPEC+ to halt talks twice already, with the next meeting scheduled for Monday, putting markets in limbo as oil continues its inflationary surge above $75 a barrel.
Govt to seek iBankers’ bid for LIC IPO
The government is likely to invite bids from merchant bankers this month for managing LIC disinvestment as it moves ahead with plans to launch the IPO by January, an official said. The Department of Investment and Public Asset Management had in January appointed actuarial firm Milliman Advisors LLP India to assess the embedded value of LIC ahead of the IPO, which is touted to be the biggest public issue in Indian corporate history.
India’s share in global m-cap up
Relatively attractive earnings prospects amid the reopening of global trade and waning pressure on corporate performance as the second wave of the pandemic flattens out have lifted India’s share of the world market capitalisation. India accounted for 2.60% of the world market capitalisation in June 2021, compared with the long-term average of 2.45%. The share had dropped to 2.05% in May 2020 when the first wave of coronavirus jolted global equity markets. Since then, it has been rising.
RBI determined to keep rates low
RBI has either cancelled weekly auctions of G-Secs or had them devolved on bond houses to the tune of a record Rs 116,008 crore in this financial year, demonstrating its determined efforts to keep funding rates under check. This could well pave the way for the government to borrow record high sums this year as North Block gears up to spur growth after two Covid waves. In the primary auctions, bond dealers started quoting yields much higher than secondary market levels, resulting in weekly bond sales of dated sovereign paper stumbling. The central bank is also said to have signalled to bidders that they need to stick close to market prices.
FMCG market expands 40% in June
India’s FMCG market expanded nearly 40% in June from a month earlier, overcompensating for a sharp decline in May when the segment fell by a third, helped by several states easing restrictions, marketers and industry watchers said. “Since April, there has been a gradual sales increase every month and June saw robust demand and recovery,” said Krishnarao Buddha, senior category head at leading biscuits maker Parle Products.
New rules for direct selling firms
Direct selling companies such as Amway, Oriflame, Tupperware and similar entities in India will now have to comply with regulatory norms. The consumer affairs ministry has issued draft rules for their mandatory registration and has also proposed mechanisms to protect the direct sellers or agents and make the companies accountable to their consumers. This is for the first time such draft rules have been framed, which specify that these entities will be barred from charging any entry or registration fee from agents.
CV sales projected to grow in 2nd half
Sales of commercial vehicles – a barometer of economic activity – are expected to post robust growth in the second half of 2021 driven by replacement demand and a pickup in construction activity amid easing of local lockdowns, industry officials said. Heavy duty trucks of 18.5 tonne and more capacity are expected to drive the sales revival, they said
Bank credit to industry drops
The industrial sector’s share in total bank credit fell sharply between 2014 and 2021, RBI data showed, as corporates continued to deleverage their books and scout for cheaper sources of funding. With banks pushing loans in the retail segment, total bank credit to the industrial sector dropped by nearly 14% during the period. However, the share of the housing segment and individual loans increased, data showed.
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