Nifty today: SGX Nifty up 95 points; here’s what changed for market while you were sleeping
Here’s the breaking down of the pre-market actions:
STATE OF THE MARKETS
SGX Nifty signals positive start
Nifty futures on the Singapore Exchange traded 96.50 points, or 0.64 per cent, higher at 15,125.50 in signs that Dalal Street was headed for a positive start on Monday.
Tech View: Nifty sets sight at 15,220
Nifty50 breached the swing high of 15,273 on Friday only to come crashing down later. Nifty50 seems to be moving sideways and is drawing support from its 20-day exponential moving average that stands at 14,957, as it bounced back after testing the said average in four out of the last five sessions to Friday. A close below the 14,950 level can accelerate the selling pressure.
Asian markets rise in early trade
Asian markets were off to a solid start while US bond yields hovered near a 13-month peak on Monday as investors bet U.S. economic growth will accelerate after the passing of a massive stimulus package. US S&P500 futures rose 0.25 per cent in early Asian trade, trading just below a record high level touched last week, while Japan’s Nikkei ticked up 0.4 per cent. MSCI’s broadest index of Asia-Pacific shares outside Japan was little changed.
Brent crude floats near $70 mark
prices edged up on Monday, with Brent drifting near $70 a barrel, propped up by output cuts from major producers and optimism about global economic and fuel demand recovery in the second half of the year. Brent crude futures for May gained 23 cents, or 0.3 per cent, to $69.45 a barrel while US West Texas Intermediate crude for April was at $65.90 a barrel, up 29 cents, or 0.4 per cent.
US stocks settled mixed on Friday
The benchmark Dow Jones Industrial Average climbed 0.9 per cent to 32,778.64, setting another record, while broad-based S&P500 edged up 0.1 per cent to 3,943.34, adding four points to the all-time high set Thursday. The tech-rich Nasdaq Composite Index recovered from the lowest point of the day, closing down 0.6 percent at 13,319.87.
MTAR Tech to make market debut
MTAR Technologies on Monday made a solid market debut, as the scrip got listed at Rs xx on BSE, a xx per cent premium over its issue price of Rs 575. The IPO, which was sold from March 3 to March 5 in the Rs 574 to Rs 575 price band, had attracted a whopping 201 times subscription. The unlisted scrip was enjoying a grey market premium of Rs 485-490 last week.
Laxmi Organic IPO to open today
Laxmi Organic, a manufacturer of industrial chemicals, will kicked off its Rs 600 crore IPO on Monday. Like the past few public issues, analysts find the issue a bit aggressively priced, but thanks to recent strong listings, a huge demand in the grey market suggests a strong subscription ahead. The IPO would be sold in Rs 129-130 price band, and would comprise issuance of fresh equity shares aggregating Rs 300 crore and an offer for sale (OFS) of shares aggregating up to Rs 300 crore.
Craftsman Automation IPO kicks off today
The Rs 824 crore IPO by auto component maker Craftsman Automation will kick start on Monday. The issue would be sold in the Rs 1,488-1,490 range and investors can subscribe to the issue by betting for a lot of 10 shares or in multiples thereof. Retail investors can bid for a maximum of 13 lots. On Friday, the company raised a little over Rs 247 crore from 21 anchor investors.
FPIs sell Rs 943 crore worth stocks
Net-net, foreign portfolio investors (FPIs) were sellers of domestic stocks to the tune of Rs 942.60 crore, data available with NSE suggested. DIIs were net sellers to the tune of Rs 163.87 crore, data suggests.
MONEY MARKETS
Rupee: Extending its gaining streak for the third day in a row, the Indian rupee advanced by another 12 paise to close at 72.79 against the US dollar on Friday amid some easing of crude oil prices.
10-year bonds: India 10-year bond yield fell 0.24 per cent to 6.232 after trading in 6.22-6.25 range.
EVENTS/DATA TO WATCH
- India WPI Inflation YoY Feb (12:00 am)
- India Balance of Trade Final Feb (05.30 pm)
- India Exports Final Feb (05.30 pm)
- India Imports Final Feb (05.30 pm)
- China House Price Index YoY Feb (07:00 am)
- China Industrial Production YoY Jan-Feb (07.30 am)
- China Unemployment Rate Jan-Feb (07.30 am)
- Japan Tertiary Industry Index MoM Jan (10:00 am)
MACROS
FM says won’t shut all windows for crypto… Finance minister Nirmala Sitharaman has indicated that not all windows for cryptocurrencies will be shut and a Cabinet note was being readied to formulate the next steps on the issue. Her comments, made in an interview during an event organised by a television channel on Saturday, have come as a huge relief for the cryptocurrency industry, which has been worried about a possible ban on its activities through a proposed legislation. “I have said my view on this, saying the Supreme Court had commented on this cryptocurrency. Whilst we are very clear that the Reserve Bank may take a call on an official cryptocurrency or anything of that kind, but from our side we are very clear that we are not shutting all options off,” she said.
Focus on AT1 bonds may hit bank fund raising… Lingering uncertainty over the valuation of perpetual bonds could hit fundraising at public-sector lenders such as Punjab National Bank, Bank of India and Bank of Maharashtra, which plan to garner funds by selling debt instruments. While the Centre has ‘requested’ the capital-markets watchdog to review its order on the treatment of such debt, regulatory silence is making investors nervous and causing yields to harden. “An amicable resolution should be found without any further disruptions,” said Mahendra Jajoo, chief investment officer – fixed income, Mirae Asset Investment Managers. “The finance ministry’s request to Sebi to withdraw a part of the new rules has helped the market settle down.”
Six PSBs out of privatisation plan… Niti Aayog has kept public sector banks (PSBs) that were part of the last round of consolidation and State Bank India out of the privatisation plan. These banks are Punjab National Bank, Union Bank, Canara Bank, Indian Bank, Bank of Baroda and SBI that were part of an earlier round of consolidation. The government will soon take a call on the two banks and one general insurer that will be taken up for privatisation in the next fiscal year.
Credit growth picking up… Bank credit growth is accelerating with aggregate loans disbursed in the past five months to February rising by 51%. An analysis of RBI’s credit data shows that banks lent ₹5 lakh crore between the end-September and February of the current fiscal, compared with ₹3.3 lakh crore in the same period of FY20. As of February 26, overall credit growth was higher at 6.6% than 6.1% a year ago. But loan growth in September 2020 was lower at 5.1% compared to 8.8% in the year-ago period, indicating that the unlock phase has spurred credit demand.
India Inc seeks better rules for Ind Directors… Indian industry has sought streamlining of the liability of independent directors (IDs), provisions of safe-harbour clauses and exclusion from vicarious criminal liability for IDs in the Companies Act. Increasing liability has led to increasing resignations of IDs and affected the availability of talented IDs for board-level positions, the Confederation of Indian Industry (CII) said in a statement on Sunday.
India now fourth largest forex holder… India overtook Russia to become the nation with the fourth-largest foreign exchange reserve despite a drop in its international investments in dollar terms. While India’s forex holdings fell by $4.3 billion to $580.3 billion as of March 5, Russia’s drop was even sharper, resulting in its numbers coming down to $580.1 billion according to data from Bloomberg. According to data released by the RBI on Friday, after rising by $689 million during the last week of February to a record $584.5 billion, the central bank’s foreign holdings fell in the first week of March.
36 MF schemes hold AT1 bond above limit… Banks that depend on additional tier-1 (AT1) bonds to meet their capital needs may not be out of the woods yet. This, despite a finance ministry memo “requesting” Sebi to hold back part of its directive on these bonds’ valuations. According to Crisil Fund Research, as many as 36 mutual fund (MF) schemes have more than the Sebi-prescribed 10% investment in these bonds. Last week, the markets regulator came out with a set of directives that would have the effect of reducing appetite for AT1 bonds among MFs. These bonds, although debt instruments, have lossabsorption features that result in their being treated as quasi-equity. The write-off of these bonds issued by Yes Bank and Lakshmi Vilas Bank, following the RBI action to protect depositors, had highlighted the risk that investors face in them.
RBI still seeking crypto ban… RBI is sticking to its stand over cryptocurrencies and has conveyed to the government its decision to seek a ban on such instruments, having already expressed its serious concerns. While asserting that the technology of blockchain should be encouraged, the central bank has questioned the purpose of cryptocurrencies to be labelled as a currency. It has said that a currency is a sovereign right and cannot be assigned to any individual entity. The issue of these instruments being legal is also yet to be settled.
DHFL moved money in circles… TDH Reality LLP, a little known Kanpur-based company with a capital of just about Rs 1 lakh, is, according to papers filed with the court, acted as an intermediary that ended up having the rights over the insurance arm of the DHFL, the first nonbanking finance company to face insolvency and bankruptcy proceedings. The link between TDH and DHFL’s insurance business follows a complex trail of transactions that show that DHFL had funded entities that in turn had financed the acquisition when DHFL divested its stake in the insurer resulting in allegations of round tripping of funds. Thus, DHFL did not gain from the transfer of the insurance business. TDH has told the court that the insurance arm cannot be sold again as it already has a claim over it.
Rajan warns against drastic money policy change… As the economy slowly comes out of the pandemic blues, former RBI governor Raghuram Rajan on Sunday cautioned that “drastic changes” in India’s monetary policy framework can upset the bond market as the current system has helped in containing inflation and promoting growth. Rajan said that the government’s target to make India a $5-trillion economy by 2024-25 was “more aspirational, rather than a carefully computed one even before the pandemic”.
