After a Thursday’s correction, domestic stocks looked set for a gap-up start on Friday, as global sentiment improved after US stocks staged a recovery in overnight trade.
Here’s breaking down the pre-market actions.
STATE OF THE MARKETS
SGX Nifty signals gap-up start
Nifty futures on the Singapore Exchange traded 74 points, or 0.65 per cent higher at 11,373, in signs that Dalal Street was headed for a gao-up start on Friday.
Tech View: Nifty forms Doji candle
Nifty50 came under selling pressure on Thursday, tracking weak global cues. The index negated higher highs and lows , and eventually formed an indecisive ‘Doji’ candle on the daily chart, raising concerns among analysts whether the index saw a ‘false breakout’ on Tuesday.
Divi’s Labs, SBI Life enter Nifty50 elite club
Divi’s Labs, SBI Life Insurance, Zee Entertainment, Bharti Infratel: Divi’s Laboratories and SBI Life Insurance Co will replace Bharti Infratel and Zee Entertainment Enterprises in the Nifty-50 index from September 25, NSE said in a release late on Thursday.
Asian markets rise in early trade
Japan’s Nikkei 225 edged up 0.76 per cent or 174.76 points to 23,055.38 in early trade. Hong Kong’s Hang Sang rose 0.87 per cent, or 215.74 points, to 25,007.13. CHina’s Shanghai Composite gained 0.49 per cent, or 16.33 points, to 3,380.23.
Oil prices nudge higher
Oil prices rose in early trade on Friday, on track for a third straight week of gains, buoyed by major oil producers’ efforts to hold back output amid concerns about the economic recovery from the coronavirus pandemic. Brent crude futures rose 16 cents, or 0.4 per cent, to $44.07, heading for a weekly rise around 0.5 per cent. WTI crude prices rose 0.2% to $42.89 a barrel.
US stocks settled higher
Wall Street’s major averages pared earlier losses to end higher on Thursday, buoyed by strong gains in tech shares.The Dow Jones Industrial Average index climbed 46.85 points, or 0.17 per cent, to 27,739.73. The S&P500 index was up 10.66 points, or 0.32 per cent, to 3,385.51. The Nasdaq Composite index rose 118.49 points, or 1.06 per cent, to 11,264.95,
Q1 earnings today
Indiabulls Housing Finance, Rossari Biotech, Oil India, Punjab National Bank, Suprajit Engineering, Union Bank of India, Coffee Day Enterprises, Kolte Patil Developers are among companies that are slated to announce their June quarter earnings on Friday.
DIIs sell Rs 672 crore worth of stocks
Net-net, foreign portfolio investors (FPIs) were sellers of domestic stocks to the tune of Rs 268.46 crore, data available with NSE suggested. DIIs were net sellers to the tune of Rs 672 crore, data suggests.
Rupee: The Indian rupee slid 20 paise to settle at 75.02 to the US dollar on Thursday, tracking weaker Asian currencies amid concerns over global economic recovery due to rising coronavirus cases.
10-year bonds: India 10-year bond yield fell 0.13 per cent to 6 after trading in 5.99-6.01 range.
Call rates: The overnight call money rate weighted average stood at 3.42 per cent, according to RBI data. It moved in a range of 1.80-4.10 per cent.
DATA/EVENTS TO WATCH
- Earnings: OIL I PNB I Rossari I Union Bank I Kolte Patil I Indiabulls Housing Finance
- Japan July Inflation Rate (05.00 am)
- Japan Jibun Bank Services PMI Flash Aug (06.00 am)
- UK July Retail Sales MoM (11.00 am)
- RBI Forex Reserve as of Aug 14 (05.00 pm)
- US July Existing Home Sales (07.30 pm)
- UK-EU Brexit Talks
Inflation fears halted RBI rate cut… Fear of inflation dominated the monetary policy committee meeting of RBI on August 6. Members said supply disruption was pushing up prices even as consumption patterns changed in favour of food, which was increasing the risk of inflation becoming broad-based. In the meeting, the members had unanimously voted for a pause in monetary policy action and left the repo rate unchanged at 4%.
US, China differ over trade deal talks… The Trump administration on Thursday declined to acknowledge any plans to meet with China over the Phase 1 trade deal after the commerce ministry in Beijing said bilateral talks would be held “in the coming days” to evaluate the agreement’s progress.
Japan’s CPI unchanged in July… Japan’s core consumer price index, which includes oil products but excludes volatile fresh food prices, stood flat in July from a year earlier. It fell short of a median market forecast for a 0.1 per cent rise, following a flat reading in June.
EPFO sees rebound in subscriber additions… The EPFO saw a robust rebound in net new subscribers with addition of 655,000 subscribers in June as industries and services resumed operations after two months of lockdown. Barely 20,000 and 172,000 subscribers were added to the EPFO in April and May respectively, resulting in net additions of about 847,000 in the first quarter of this financial year.
Banks stare at major trading losses… Domestic banks are anticipating major trading losses, unless the regulator eases its cap on the amount of bonds banks hold in the held-to-maturity segment. That will encourage lenders buying government bonds in the weekly primary auctions, which remained partly unsold last Friday. A section of the market has already reached out to the central bank with the proposal
Pharma profit booster set to fizzle out… Ipca Laboratories, Glenmark and Zydus Cadila, companies making drugs that are being used in the treatment of the pandemic, have seen sales increase in lockstep with the rising number of confirmed Covid cases in the country. But analysts say they are going to see a profitability squeeze when more drugmakers begin to produce the prescribed antivirals and prophylactics.
RBI puts check on Mauritius cash for NBFCs… Investments coming from Mauritius are once again facing increased regulatory scrutiny — now from RBI. Over the past few weeks, the central bank has reportedly turned down several applications from NBFCs due to their connections with Mauritius, three executives privy to the development told ET
US approved record H-1B visas in Q3… The US has approved 95.5% of the total H-1B visa applications filed in the third quarter of the ongoing fiscal year, the highest ever since President Donald Trump took power. The data is for the quarter ended June 30, days after Trump suspended new non-immigrant visas, including the H-1B and L-1, through a Presidential Proclamation citing threats to American jobs.
Rly starts work on freight corridors… Indian Railways has begun initial work on four more dedicated freight corridors in the country, although the eastern and western freight corridors being currently implemented have been pushed back by six months due to Covid-19. The 1,483 km long western dedicated freight corridor between Uttar Pradesh and Mumbai and the 1,839 km eastern dedicated freight corridor between Punjab and West Bengal were set to be completed by December 2021.
SC worries on AGR recovery from bankrupt telcos… The Supreme Court expressed concern over how statutory AGR dues of bankrupt telecom companies would be recovered if their spectrum were transferred during the insolvency resolution process. The court asked the DoT on Thursday who would pay the AGR dues of ailing telcos Reliance Communications, Aircel and Videocon, which are resolution cases under the Insolvency and Bankruptcy Code.
Shareholders questions Tata Steel UK status… Several shareholders of Tata Steel on Thursday questioned the management on the future of its unprofitable UK unit after the Indian company expressed doubts over the British arm’s ability to continue as a going concern and meet liquidity requirements. They also enquired about the status of the UK govt’s bailout package for the British unit after international media reported that rescue talks between the two had failed.