SGX Nifty down 46 points; here’s what changed for market while you were sleeping

Domestic stocks looked set to take a breather start on Wednesday ahead of the outcome of the US Fed policy meeting scheduled for later in the day. Asian markets traded largely mixed after a flat closing for US stocks overnight. At home, stocks of Axis Bank, Maruti, Britannia would be in focus following their Q4 earnings.

Here’s breaking down the pre-market actions.

STATE OF THE MARKETS

SGX Nifty signals positive start

Nifty futures on the Singapore Exchange traded 46 points, or 0.31 per cent, lower at 14,704.50 in signs that Dalal Street was headed for a negative start on Wednesday.

Tech View: Nifty resistance at 14,750

Nifty50 on Tuesday breached its 20-day exponential moving average (EMA) on a closing basis. This was the third straight session when the index made a higher high-low formation. On the day scale, the index formed a bullish candle after forming two indecisive charts. Analysts said the daily momentum indicators have turned in favour of the bulls. They believe Nifty may test the 14,750 level in the coming days.

Asian markets mixed in early trade

Asian markets were trading mixed in Wednesday’s trade. Korea’s Kospi tanoed 0.90 per cent lower while China’s Shanghai Composite index shed 0.19 per cent. Japan’s Nikkei advanced 0.41 per cent to 29,111. Hong Kong’s Hang Seng added 0.29 per cent.

US stocks settled flat

US equities were mostly flat on Tuesday while tech shares dropped amid a flurry of quarterly earnings and ahead of the conclusion of the Federal Reserve’s two-day meeting. The benchmark Dow Jones Industrial Average closed essentially unchanged at 33,984.93, as did the broad-based S&P 500, which shed less than a point from Monday’s record to end at 4,186.72. The tech-rich Nasdaq Composite Index fell 0.3 per cent to 14,090.22.

Q4 earnings today

Bajaj Finserv, Biocon, Mastek, Tata Comm, UTI AMC and Bombay Dyeing are among the companies that are scheduled to announce their March quater earnings on Wednesday.

DIIs buy Rs 1,463 crore worth stocks

Net-net, foreign portfolio investors (FPIs) were sellers of domestic stocks to the tune of Rs 1,454.75 crore, data available with NSE suggested. DIIs were net buyers to the tune of Rs 1,463.44 crore, data suggests.

MONEY MARKETS

Rupee: The rupee appreciated by 7 paise to close at 74.66 against the US dollar on Tuesday on the back of positive domestic equities. At the interbank forex market, the local unit opened at 74.65 against the greenback and witnessed an intra-day high of 74.51 and a low of 74.73.

10-year bonds: India 10-year bond yield rose 0.28 per cent to 6.05 after trading in 6.04-6.06 range.

Call rates: The overnight call money rate weighted average stood at 3.20 per cent, according to RBI data. It moved in a range of 1.90-3.50 per cent.

DATA/EVENTS TO WATCH

  • Q4 Earnings: Bajaj Finserv | Biocon | Mastek | Tata Comm | UTI AMC | Bombay Dyeing
  • Australia Inflation Rate YoY Q1 (07:00 am)
  • US MBA Mortgage Applications 23/April (04:30 pm)
  • US Wholesale Inventories MoM Adv March (06:00 pm)
  • US Goods Trade Balance Adv March (06:00 pm)
  • US EIA Crude Oil Stocks Change 23/April (08:00 pm)
  • US Fed Interest Rate Decision (11:30 pm)
  • US President Biden Speech

MACROS

Fed policy outcome today… The Federal Reserve has committed to sustaining stimulus to the US economy until it has recovered from the Covid-19 pandemic, and is expected to remain firm in that stance when it concludes its policy meeting on Wednesday. But as the accelerating vaccination campaign offers hope life can return to normal following the disruptions caused by the pandemic, the Fed has to face down growing concerns that surging economic activity will ignite uncontrolled inflation.

India seeing steep drop in biz activity… India’s business activity suffered its steepest weekly fall in over a year in the seven days ended April 25 as many states imposed lockdowns to contain the resurgent pandemic, showed a tracker compiled by Japanese brokerage Nomura. However, the real economic impact is seen to be “small” compared with the first Covid wave as indicators such as the labour force participation rate among others have remained resilient, Nomura said in a report on Tuesday.

Govt mulls lockdown in 150 dists… A proposal has been drawn up for a lockdown, with exemptions for a set of defined essential services, in around 150 districts with Covid-19 positivity rate of over 15% as health systems in these areas are seen to be under stress due to the pandemic. The steps were recommended by the Union health ministry at a high-level meet Tuesday, but a final decision will be taken by the Centre in consultation with states. The proposal may be further refined, but the need to tackle the spread in high-caseload, high-positivity districts was underlined by the ministry.

Bad bank may get nod soon… The government is expected to soon clear the proposed ARC that will take over stressed debt, though the promised sovereign support for the bad bank is likely to come with some riders. The government will offer a sovereign guarantee to security receipts issued by the ARC only when the asset is bought under a certain haircut band.

Bank auditor norms tightened… RBI has tightened the norms for appointing auditors and has capped their numbers based on the asset size of the lenders with an aim to prevent wide variations in asset classification and misleading accounts statements. Banks shall take prior approval from the RBI on the appointment of auditors, but non-bank lenders can go ahead with just intimating the regulator.

NBFCs seek loan recast facility… Non-banking finance companies (NBFCs) have written to the RBI governor seeking a dispensation for restructuring loans by the shadow banks to small businesses and of loans availed by these lenders. NBFCs have also sought liquidity support as the industry has been hit hard by the second wave of the pandemic.

Sebi bans ratings sales pitch… The market regulator said on Tuesday no credit rating agency can assign a rating, including provisional decisions, to an issuer or client evaluating strategic decisions. The move comes after Oaktree, one of the bidders for stressed home financier DHFL, had mentioned in its resolution plan that it received an ‘AAA’ rating from credit rating agencies should it have won the bid.

India Inc readies to vaccinate staff… Companies are chalking out plans to get all employees vaccinated against Covid-19, as everyone aged 18 and above becomes eligible from Saturday. RIL last week announced its plans to roll out a vaccination programme for all employees and their family members above 18 years of age from May 1. RPG Group, Vedanta, Marico and Emami told ET that they are in talks with vaccine makers to directly source the injections for their staff. Some like ITC, Panasonic, Axis Bank and HDFC Bank have tied up with hospitals such as Apollo, Max Healthcare and Fortis.



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