NEW DELHI: The trend in Singapore Nifty futures and gains seen in Asian markets early on Monday hinted at a positive start for Dalal Street. That said, consecutive indecisive candles on Nifty charts for five sessions suggest things can go either way by the end of the session.
Here’s breaking down the pre-market actions.
SGX Nifty signals positive startNifty futures on the Singapore Exchange traded 42 points, or 0.39 per cent higher at 10,820.50, in signs that Dalal Street was headed for a positive start on Monday.
Tech View: Nifty50 forms Spinning TopNifty50 stayed in a range in line with the trend seen in the past four sessions, highlighting indecisiveness among the traders all through the week. It was quite visible in the ‘Doji’ candle formation on the daily scale and a similar indecisive ‘Spinning Top’ on the weekly scale. These signs are not in favour of the bulls, analysts said.
Asian shares off to firm startAsian shares got off to a firm start on Monday as investors wagered US earnings season would see most companies beat forecasts given expectations had been lowered so far by coronavirus lockdowns. MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.15 per cent, having climbed sharply to a five-month peak last week on the back of surging Chinese stocks. Japan’s Nikkei gained 1.3 per cent and South Korea 0.9 per cent.
Oil slips as traders eye supply cutOil slipped in early Asian trade on Monday as traders eyed an OPEC technical meeting this week which is expected to recommend an easing in supply cuts that have been propping up crude prices. Brent crude fell 27 cents to $42.97 a barrel while US WTI crude was at $40.27 a barrel, down 28 cents.
US stocks ended mixedOn Friday, US stocks finished higher as a broad gain in financial shares bolstered the market. The Dow Jones Industrial Average jumped 369.21 points, or 1.44 per cent, to 26,075.30. The S&P 500 rose 32.99 points, or 1.05 per cent, to 3,185.04. The Nasdaq Composite index was up 69.69 points, or 0.66 per cent, to 10,617.44.
Rossari Biotech IPO kicks off todayThe IPO market is set to see its first mainboard IPO of financial year 2019-20 with Rossari Biotech hitting the market with its Rs 500 crore IPO on Monday. On Friday, the specialty company raised Rs 148.87 crore from anchor investors. At the higher end of the price band Rs 423-425, the specialty chemical company is seeking valuations of 19.9 times FY20’s EV/Ebitda and 33.1 times earnings per share on a FY20 basis.
FIIs sell Rs 1,031 cr worth of stocksNet-net, foreign portfolio investors (FPIs) were sellers of domestic stocks to the tune of Rs 1,031 crore, data available with NSE suggested. DIIs were net sellers to the tune of Rs 431.21 crore, data suggests.
Dollar slips, yuan up
The dollar fell in Monday’s Asian trade. The yen gained 0.1% against the greenback, while the offshore yuan rose by a similar measure. The euro gained 0.2% against the US currency
Gold prices edge higher
Gold prices edged higher on Monday, holding above the key $1,800-per-ounce level, as worries over surging coronavirus cases around the world kept the safe-haven metal underpinned. In India, prices of the yellow metal rose to Rs 45,177 from Rs 44,977 per 10 gm on Monday while silver climbed by nearly Rs 500 to Rs 50,975 per kg. On MCX, gold prices dropped 0.01% to Rs 48,872 on Friday, while silver edged higher to Rs 51,217
FPI bullish bets highest in a year
The extent of bullish bets held by foreign investors in the futures segment touched the highest level in over a year last week. The long-short ratio — a measure of bullish positions compared to bearish ones — on futures positions of FPIs touched 65.6% on Thursday before seeing a dip to 57% on Friday, said derivative analysts. When the ratio is high, it means sentiment is bullish and vice versa.
Rupee: The Indian rupee weakened by 21 paise to close at 75.20 against the US dollar on Friday amid foreign capital outflows and a firm greenback overseas. A weak trend at Asian equity markets following a spurt in COVID-19 cases also hit sentiment, forex traders said
10-year bonds: India 10-year bond yield fell 0.21 per cent to 5.76 after trading in 5.74-5.77 range.
Call rates: The overnight call money rate weighted average stood at 3.52 per cent, according to RBI data. It moved in a range of 1.80-4.05 per cent.
DATA/EVENTS TO WATCH
Q1 Earnings: 5Paisa
India June Inflation Print (05.30 pm)
ECB Panetta Speech (03.00 pm)
US Consumer Inflation Expectations June (08.30 pm)
BoE Gov Bailey Speech (09.00 pm)
China June FDI (YoY) (11.30 pm)
June CPI numbers today… CPI inflation numbers for June will be released on Monday. Barclays said there could be a detailed headline CPI number for June, which it expects at 5.4 per cent, a slight increase month-on-month. “If the government does release a full headline inflation print for June, we think it may also be able to provide statistical interpolations for April and May as well,” Barclays said.
Economy to contract 4.5% in FY21… The Indian economy is likely to see a deep contraction of 4.5% in this financial year, according to the July edition of the Ficci Economic Outlook Survey released on Sunday. The survey pegged the median growth forecast for the first quarter of FY21 at -14.2% and said the contraction should bottom out by the end of the second quarter. The survey found the median expectation of fiscal deficit at 6.9% of GDP against a target of 3.5%.
Banks set to report sharp margin squeeze… A sharp fall in lending rates due to aggressive benchmark rate cuts by RBI and faster deposit growth during the lockdown could lead to a 10-15 basis point contraction in bank margins, impacting profitability in the first quarter ended June 2020. One basis point is 0.01percentage point. Loan growth is likely to be slower as the quarter was entirely washed out due to the nationwide lockdown.
India Inc busy hiring CXOs … The last three months have been tumultuous for businesses, but leadership hiring has remained relatively unaffected. Industry estimates reveal that more than 200 executives have been placed in the last three months, a period which witnessed industries virtually shutting factories in the early part, with demand coming down to zero. Given the anecdotal evidence of large companies announcing appointments of CXOs/CEOs, substantiated with what executive search firms have told TOI, leadership hiring hasn’t stopped at all.
RIL wants Future lenders to take hair cut… RIL is in talks with lenders to Kishore Biyani’s Future Group for a haircut on loans and easier terms of repayment, said three people aware of the development. RIL is said to be looking to buy the retail venture. The negotiations involve a haircut of nearly 30% on outstanding loans of more than Rs 6,000 crore and refinancing part of the borrowings for a further period of 5-7 years, said one of the persons.
TCS gung ho on FY21 hiring plans… TCS plans to keep its India campus hiring this year at about the same level as last year at 40,000, despite the sharp drop in revenue in the quarter ended June on account of the Covid-19 fallout. It also plans to double its US campus hires to nearly 2,000 this financial year, as part of an effort to reduce dependence on H-1B and L-1 work visas, which are becoming increasingly difficult to get.
Sebi perplexed by retail surge… Sebi is ‘perplexed’ by the record high retail participation in Indian equities since the lockdown, said chairman Ajay Tyagi. In an interview — his first since he took charge as Sebi chief in March 2017 — the reticent former bureaucrat, whose term as the ninth chairman of the capital markets regulator ends next month, expressed concern over the sharp surge in retail activity in the stock market at a time when many have lost jobs or suffered salary cuts. Tyagi said Sebi is not in favour of allowing companies to combine their first and second-quarter results despite the economic disruptions on account of the Covid-19 pandemic.
New levy haunts MNCs… Thousands of intergroup transactions, involving MNCs and their overseas subsidiaries or parent entities, are set to attract an additional 2% tax if these have happened online — either through emails or any internal systems. This means any online transaction — from auto imported to India through an ERP system to a project work where Indian employees are adding value through an email — could attract a 2% equalisation levy, tax experts said. MNCs would be required to pay up as India has not postponed or shelved the levy.
Delhi bungalows on distress sale… More than two dozen houses in the heart of the national capital – New Delhi’s most exclusive address – are in the market as stressed owners and investors seek to raise funds and rebalance their real estate portfolios in the wake of Covid-19. Bungalows with price tags ranging from Rs 75 crore to Rs 160 crore have been listed on platforms such as Sotheby’s and local brokers, said realtors. The more expensive homes – valued at up to Rs 600 crore – are expected to make their way to the list soon. These prime properties are located in the posh areas such as Lutyens Bungalow Zone, Hailey Road, Jor Bagh and Golf Links.