by admin | May 25, 2021 | Uncategorized
Mumbai : After two consecutive sessions of losses, the two key indices of the Indian equity markets — NSE Nifty50 and BSE Sensex — made marginal gains on Tuesday, as positive global cues along with “some value buying” buoyed investors’ sentiments.
According to market observers, positive Asian and European markets as well as “an initial spurt of value buying” enhanced the risk-taking appetite of investors.
Healthy buying was witnessed in pharma, media and banking companies stocks.
The 30-scrip Sensitive Index (Sensex) closed higher by 33 points or 0.11 per cent.
Similarly, the wider 51-scrip Nifty of the National Stock Exchange (NSE) rose by 11.20 points or 0.11 per cent at 9,765.55 points.
The BSE Sensex, which opened at 31,393.93 points, closed at 31,291.85 points, up by 33 points or 0.11 per cent from Monday’s close at 31,258.85 points.
The Sensex touched a high of 31,484.28 points and a low of 31,241.50 points during the intra-day trade.
The BSE Sensex and NSE Nifty had opened higher on Tuesday against their respective previous sessions’ close.
However, broad market indices — the BSE mid-cap and BSE small-cap — underperformed the main indices.
“Markets ended with marginal gains on Tuesday after trading in a tight range during the day,” Deepak Jasani, Head of Retail Research, HDFC Securities, told IANS.
“Gains in European and Asian bourses helped the main indices to settle with marginal gains. Major Asian markets have ended on a positive note, barring the Nikkei index. European indices like FTSE 100, DAX and CAC 40 traded higher.”
On the currency front, the Indian rupee strengthened by four paise to 64.10 to a US dollar from its Monday’s close.
In investments, provisional data with the exchanges showed that foreign institutional investors (FIIs) sold scrip worth Rs 828.69 crore, whereas domestic institutional investors (DIIs) purchased stocks worth Rs 435.05 crore.
“Major losers were NTPC, Hero MotoCorp and Bajaj Auto as they post losses between 1.2 per cent and 2.2 per cent. Dr Reddy’s, Lupin and Sun Pharma were the top gainers as their stocks rose by 3.30 per cent, 1.93 per cent, and 1.64 per cent, respectively,” Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS.
Major Sensex gainers on Tuesday were: Dr Reddy’s Lab, up 2.67 per cent at Rs 1,984.85; Lupin, up 2.32 per cent at Rs 944.25; Sun Pharma, up 2.24 per cent at Rs 470.85; ONGC, up 1.11 per cent at Rs 159.30; and Axis Bank, up 1.01 per cent at Rs 499.15.
Major Sensex losers were: NTPC, down 2.56 per cent at Rs 167.45; Hero MotoCorp, down 2.07 per cent at Rs 3,885.30; Bajaj Auto, down 1.09 per cent at Rs 2,740.50; Tata Consultancy Services (TCS), down 1.01 per cent at Rs 2,496.05; and Larsen and Toubro (L&T), down 0.64 per cent at Rs 1,119.25.
—IANS
by admin | May 25, 2021 | Corporate, Corporate finance, Finance, News
Mumbai:(IANS) Weak global cues dented investor sentiments at the Indian equity markets, leading to a barometer index closing flat on Monday.
The S&P BSE Sensex, which opened at 26,107.98 points, provisionally closed at 26,194.67 points (at 3.30 p.m.) — down 24.24 points or 0.09 percent from the previous day’s close at 26,218.91 points.
The Sensex touched a high of 26,233.46 points and a low of 25,972.54 points in the intra-day trade.
The barometer 30-scrip sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE) had gained 255 points or 0.98 percent at 26,218.91 points (on Friday, September 18).
A flat trajectory was also observed at the wider 50-scrip Nifty of the National Stock Exchange (NSE). It fell marginally by 4.80 points or 0.06 percent at 7,977.10 points.
Market observers pointed out that weak global cues emanating out of the Asian markets impacted investor sentiments.
“Due to the absence of any fresh domestic triggers, the markets were solely focused on the international trends. The subdued Asian markets and the lower closing of the US markets on Friday impacted investors’ sentiments here,” Anand James, co-head, technical research desk with Geojit BNP Paribas Financial Services, told IANS.
Other market watchers said the global growth concerns couple with a possible US interest rate hike in the later part of 2015 also played negatively on investors sentiments
“The uncertainty related to the US Fed rate hike continues to worry investors coupled with growth concerns,” Vaibhav Agrawal, vice president, research, Angel Broking, told IANS.
“We expect the pressure to continue ahead of the F&O (futures and options) expiry this week.”
Among the Asian markets, Japan’s Nikkei dropped by 1.96 percent, Hong Kong’s Hang Seng fell by 0.75 percent. However, Shanghai Composite Index closed higher by 1.91 percent.
Sector-wise, banking, capital goods and automobile managed to stay afloat. However, fast moving consumer goods (FMCG), consumer durables and oil and gas stocks declined.
The S&P BSE banking index augmented by 167.57 points, capital goods index rose by 71.73 points and automobile index increased by 40.95 points.
The S&P BSE FMCG index receded by 61.56 points, consumer durables declined by 33.65 points and oil and gas index was lower by 27.66 points.
by admin | May 25, 2021 | Investing
Mumbai, Aug 24 (IANS) Strong economic fundamentals have the potential to hasten the recovery in Indian equity markets after Monday’s massive decline, said analysts.
Devendra Nevgi, chief executive of ZyFin Advisors, predicted that the strong fundamentals will help India standout from its peers and hasten the recovery in stock and currency markets.
“The Indian economy’s fundamentals are very strong, be it growth, be it lower current account deficit, slowdown in inflation, pickup in consumer sentiment and hopes of a rate cut. These factors will contain the fall and hasten recovery in India faster than other markets,” Nevgi told IANS.
“The low global commodity prices and attractive valuations after the massive correction should lead the investors back.”
Notwithstanding the strong fundamentals in the Indian economy, the huge losses in the day’s trade will push policy makers to urgently restart stalled reforms especially movement on the goods and services tax (GST) said Dipen Shah, head of private client group research with Kotak Securities.
“It should be a priority for the government to restart the reforms process now. The world economy is stalling and the US rate hike decision is coming up in September, this is also an opportune time for the Reserve Bank to have a re-look at the policy rates,” Shah said.
At the same time, foreign funds outflow from India to the US in the hindsight of the upcoming rate hike decision was expected said Vaibhav Agarwal, vice president and research head at Angel Broking.
“The US Fed is expected to take a call on raising the US rate hike in over a decade. This is a major catalyst for the movement of the foreign funds from India and other EMs back to the US,” Agarwal told IANS.
“However, lower commodity prices and strong fundamentals plus a push towards infrastructure creation will propel the economy. This will certainly catch the attention of the global capital markets once the turmoil has subsided.”
On the bright side, the massive correction is expected to make valuations attractive for not only foreign investors but domestic ones too.
Gaurav Jain, director with Hem Securities, pointed out that buying might take place if the Nifty crosses the 8,040 level in Tuesday’s trade.
Spooked by a crash in Chinese bourses and unmindful of the assertions by policy makers that the turbulence was transient and the country’s economy remained strong, the sensitive index (Sensex) of the Bombay Stock Exchange (BSE) lost as much as 1,624.51 points, or 5.94 percent — which was the steepest in terms of points.
In this turmoil, the Indian rupee also fell to its lowest in two years at 66.74 to a dollar.
The Sensex’s massive fall on Monday surpassed its previous highest closing loss of 1,408.35 points on Jan 21, 2008.
In terms of percentage, the loss of nearly 6 percent on Monday was around a half of the steepest fall of 11.13 percent in the Sensex, which was logged on May 17, 2004, data available with the Mumbai bourse showed.
The wider, 50-scrip Nifty of the National Stock Exchange (NSE) followed a similar trend to close 491 points, or 5.92 percent, down at 7,809 points. In both bourses as much as Rs.7 lakh crore ($100 billion) was wiped out in terms of marketcap.
“International investors are pulling back funds from emerging markets especially China. There is a slowdown there. The clear and present danger now is the slowdown impacting the US and European based companies,” Anand James, co-head, technical research, Geojit BNP Paribas, told IANS.
by admin | May 25, 2021 | Corporate, Corporate finance
Mumbai:(IANS) A massive sell-off in the Indian equity markets pushed the Indian rupee to a 23-month low of Rs.66.79 to a dollar during intra-day trade on the foreign exchange markets.
The rupee closed at the Rs.66.79-mark on the day when a barometer index of the Indian equity markets plunged by 1,624.51 points, or 5.94 percent — its steepest fall in terms of points.
“Rupee is following the equities fall. The sell-off in the global equities has impacted the rupee badly. If the sell-off continues, we might see rupee plunging further,” Hiren Sharma, senior vice president, currency advisory at Anand Rathi Financial Services, told IANS.
The major catalyst for the rupee’s fall has been the devaluation of yuan, intended to boost Chinese exports.
China’s central bank devalued yuan by two percent on August 11. This was the biggest devaluation of the Chinese currency since 1994.
The currency fell again by another two percent on August 12 panicking the world economy.
The measure to devalue the yuan is also seen as an attempt to arrest the implosion in the Chinese markets– whose benchmark index fell by over 8 percent on Monday, prompting fears of another round of yuan devaluation.
The yuan has fallen by 4.6 percent till now since August 11.
The world markets are fearful of the fact that the $10 trillion dollar Chinese economy has the ability to dump unlimited amounts of goods and services, thereby cornering the entire international exports customers base.
“The next move in the rupee will depend on the global situation and the Reserve Bank of India (RBI). A major part of the global cues will emanate out of China, as the Chinese government will take steps to arrest the fall in their markets,” Anindya Banerjee, senior manager for currency derivatives with Kotak Securities, told IANS.
by admin | May 25, 2021 | Business, Economy, News
Rupees five hundred
By Rohit Vaid
Mumbai:(IANS) A crashing rupee, disappointing results and diminishing rate cut hopes coupled with profit bookings on concerns over commodities prices, consumer sentiments and China drowned the Indian equity markets last week.
Bearish sentiments ruined investor sentiments– plunging the barometer 30-scrip sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE) by over 700 points or around 2.50 percent.
The Sensex ended last week at 27,366.07 points from 28,067.31 points closing on August 14. The benchmark index fell around 170 points or 0.59 percent during the previous weekly trade (August 14).
“The currency market slide has been the major theme last week in India, overshadowing several positive announcements favouring banking sector, as well as the overall economy,” Anand James, co-head, technical research, Geojit BNP Paribas, told IANS.
As per James, the continuous slide in rupee value which resulted in Friday’s close of Rs.65.83, a new 2-year low and breaching of the Rs.66 to a dollar mark in futures markets unnerved investors.
On the bright side James pointed that: “The slide in currencies and equity markets has not yet reached a panic state.”
The major catalyst for the rupee’s slide has been the devaluation of yuan, intended to boost Chinese exports.
China’s central bank had devalued the yuan by two percent on August 11. This was the biggest devaluation of Chinese currency since 1994. The currency fell again by another two percent on August 12 panicking the world economy.
The move strengthened the dollar value, which has negatively impacted major world currencies including the Indian rupee. The yuan has fallen by 4.6 percent till now since August 11.
Devendra Nevgi, chief executive of ZyFin Advisors, told IANS that if the Chinese markets continue to lose steam then further yuan devaluation can take place.
“The Chinese government, brokerage firms and mutual funds aren’t able to arrest the fall in their markets. Though unrelated, the stock market crash can transform into further yuan devaluation to perk up the economy,” Nevgi cautioned.
Some estimates point out that the continuous slide in the exchanges of the Chinese economy has wiped off 40-45 percent of the entire stock value in the last three months.
Rahul Dholam, senior analyst with Angel Broking, said that yuan devaluation at a time of global slowdown, commodities price crash and the likelihood of the US Fed raising interest rates has set a scenario for the start of currency wars.
“The Indian benchmark indices fell this week led by global concerns over the slowdown in the Chinese economy, fall in oil, other commodity prices and fears of a currency war led by the yuan devaluation,” Dholam elaborated to IANS.
The Indian markets were also shaken by the weak Caixin (China manufacturing purchasing managers’ index) for August. Caixin is a barometer of factory output in the $10 trillion dollar Chinese economy.
Vineeta Mahnot, equity research analyst with Hem Securities, highlighted that the sell off by foreign portfolio investors (FPIs) on subdued earnings, stalled reforms, investment derailment and downward spiral in capital goods manufacturing brought the markets down.
“Sharp sell offs were triggered on worries over subdued corporate earnings, sell off by FPIs and profit booking dampened the sentiments,” Mahnot added.
Other worries for investors have stemmed from the fact that the Reserve Bank of India (RBI) has shown its reluctance to cut interest rates even after current data showed inflation being under control.
“Extended slide in oil prices has cast doubts on the chances of US Fed’s rate hike. This gives RBI a rope for pushing rates lower. However, the central bank is likely to wait till Federal Open Market Committee (FOMC),” James added.
According to James, the stalling of the reforms process — especially the deadlock over the GST (goods and services tax) bill — has demoralised investors and cast a shadow over the government’s push for better economic policies and ease of doing business in India.
Another dampener in last week’s trade was global credit ratings agency Moody’s decision to lower India’s growth forecast for this year by 50 basis points to seven percent.
(Rohit Vaid can be contacted at rohit.v@ians.in)
