Illustration: Uttam Ghosh/Rediff.com After a brief respite at the year's start, FPIs have dumped shares worth more than $5.7 billion (Rs 42,596 crore), taking the cumulative net outflows since October to $10.5 billion (Rs 78,466 crore), and adding to the volatility on the bourses. The figure would have been a lot worse had it not been for net purchases to the tune of $5.7 billion in the primary market from October to date.
A strong and stable dollar is both in the American interest and in the interest of the global economy, US Federal Reserve Board chairman Ben Bernanke said on Wednesday.
'Rate cut should reiterate RBI's commitment in providing confidence to consumers and small business.'
The rupee's gains came even as most emerging Asian currencies eased as the yuan fell beyond 6.20 to the dollar for the first time since April last year amid market speculation that the central bank will keep the currency weak as economic growth slows.
Equity market sentiment this week will be guided by global trends in the absence of any major domestic triggers, while bourses may also see some volatility amid expiry of derivatives contracts, analysts said. Fears of sooner-than-expected tapering in monetary stimulus by the US Federal Reserve, rising cases of the Delta variant of the coronavirus coupled with China's regulatory crackdown triggered selling in global markets in the previous week.
'At current valuations, we believe large-caps offer better downside support.' 'Hence, we are suggesting a small tilt towards them.'
The suspected drug peddler, Dattaprasad Gaonkar, was detained from Anjuna after the accused duo "confessed" in their statement that they had procured drugs from him.
Economists warn of the impact that a Fed rate rise could have on emerging economies.
Markets are assuming that by the second half of 2021, the world will be approaching some type of normalcy, points out Akash Prakash.
The comment was in response to a June 19 Reuters story citing sources with knowledge of the matter as saying that India planned to clear some oil payments to Iran through the United Arab Emirates central bank.
As COVID-19 infections spike in the country resulting in restrictions in various states and impacting the fragile recovery, many economists are expecting RBI to delay the policy normalisation move, which is expected in the February review. The country has reported a single-day rise of 58,097 new Covid-19 cases as of Wednesday morning--the highest in around 199 days -- of which 2,135 are Omicron cases and later in the day, the first confirmed Omicron-related death has also been reported. Maharashtra recorded the maximum number of 653 Omicron cases followed by Delhi at 464, Kerala 185, Rajasthan 174, Gujarat 154 and Tamil Nadu 121 cases, taking the total tally of cases to 3,50,18,358.
Probably 35 bps. There could be even an encore in February 2023 to take the policy rate to 6.5% before the financial year ends, predicts Tamal Bandyopadhyay.
PowerGrid was the top gainer in the Sensex pack, rising around 4 per cent, followed by NTPC, Tata Steel, Bharti Airtel, Sun Pharma and Bajaj Finserv. On the other hand, IndusInd Bank, Asian Paints, Infosys, Bajaj Auto and Maruti fell up to 2.59 per cent.
The Sensex and Nifty spiralled lower for the fourth session on the trot on Wednesday as investors remained on edge ahead of US inflation data, which will give clues on the Federal Reserve's policy tightening trajectory. Unabated selling by foreign institutional investors and a jump in crude prices also weighed on sentiment, traders said. Despite a firm start, the 30-share BSE Sensex failed to carry forward the momentum and ended at 54,088.39, lower by 276.46 points or 0.51 per cent. During the day, it tumbled 845.55 points to 53,519.30.
After turning net buyers last month, foreign investors have become aggressive shoppers of Indian equities and have invested Rs 22,452 crore in the first two weeks of August amid softening inflation concerns. This was way higher than a net investment of nearly Rs 5,000 crore by Foreign Portfolio Investors (FPIs) in the entire month of July, data with depositories showed. FPIs had turned net buyers for the first time in July, after nine straight months of massive net outflows, which started in October last year.
The S&P BSE Sensex slipped 305 points to end at 25,400 and the Nifty50 dropped 87 points at 7,783.
The US Federal Reserve on Tuesday cut interests rates by 0.75 points from 3 per cent to 2.25 per cent. The cut initially disappointed markets which had risen sharply on hopes of a 1 percentage point cut. The decision was taken by eight votes to two. First quarter earnings at the two Wall Street firms fell less than analysts had expected, easing concerns about the state of the investment banking sector.
The sharp correction in equity markets has taken a toll on mid-and-small cap stocks that have underperformed their large-cap peers. Thus far in calendar year 2022 (CY22), the mid-and-small cap indexes on the BSE have slipped over 8 per cent and 7 per cent respectively, as compared to a fall of around 6 per cent in the S&P BSE Sensex. While investors dumped mid-and small-cap stocks as the markets remained choppy over the past few weeks, analysts still expect these two segments to see good investor interest from a medium-to-long term perspective.
Equity benchmark Sensex on Monday crashed about 1,546 points to sink below the 58,000-level due to across-the-board selloff tracking sluggish global markets. Besides, persistent foreign capital outflows continued to affect the market sentiment, traders said. Benchmark indices started the session on a weaker note and the selling intensified during afternoon trade, with almost all sectoral indices ending in the red. The 30-share BSE Sensex ended 1,545.67 points or 2.62 per cent lower at 57,491.51.
Some profit taking towards the end saw the Sensex pare gains and finally settle at 17,594 - up 5.2% (864 points) - third best single-day gain ever. Thus, the index today broke its seven-day losing streak wherein the index had shed 19% (4,097 points). The NSE Nifty gained 304 points to close at 5,203.
Macro-economic data from China and minutes of the US Federal Reserve's last meeting caused the turmoil as stocks tumbled around the globe.
All evidence suggests that the US Federal Reserve will raise interest rates soon.
Reflecting nervousness over the prospect of the Federal Reserve tightening policy and event risk, traders stayed on the sidelines
It does feel like we are close to the end of the rupee's rally, says Jamal Mecklai.
India must take urgent measures like issuing sovereign guaranteed bonds and exempting FIIs from short term capital gains tax to stem the rupee's slide, India Inc said.
Premium valuations era started in 2006 and went hand in hand with decline in the US interest rates
The US FOMC concludes its two-day meeting today while the Bank of Japan will start its two-day meeting today.
Domestic equities will be mainly driven by global market trends, foreign institutional investors' movement and developments around new Covid variant Omicron this week, according to analysts. Markets traded under pressure last week following weak global cues and overall investor sentiment remained downbeat throughout the week, they observed. "Global markets, Omicron variant, dollar index and FIIs' behaviour will be key factors to drive the market this week," said Santosh Meena, head of research, Swastika Investmart Ltd. One major event last week was US Federal Reserve's announcement that it will end bond-buying from March, and it also signalled starting rate hike cycle thereafter.
The US Federal Reserve has said economic activity is improving while deciding to continue with the near-zero interest rate regime to bolster the economy.
Indian rupee is likely to test 76-76.50 levels as a relatively strong greenback, boiling crude prices and COVID headwinds deepen the depreciation bias for the domestic currency, according to experts. One of the significantly-hit Asian currency in recent months amid uncertain economic times, rupee is expected to see a consolidation in the vicinity of the current level before being pulled towards the depreciation bias. While the equity market has been surging with occasional blips, the rupee has mostly been weak against the US dollar in recent months.
'A strong foreign exchange reserve is the best safety net against global spillovers.'
Heavy unwinding by foreign portfolio investors and lacklustre equities dampened the sentiment
Bajaj Finserv was the top gainer in the Sensex pack, rising over 4 per cent, followed by L&T, HDFC, Axis Bank, SBI, Reliance Industries and IndusInd Bank. NSE Nifty soared 276.30 points to its new closing peak of 17,823.
'If because of El Nino, the monsoon is affected adversely in the current year, naturally it will affect income projections and consequently Budget numbers.'
The difference between what the banks play in the US and India is not that of soccer and football but rugby and football. SVB also has a unique character. But when risks are mispriced, the fallout could be very similar, points out Tamal Bandyopadhyay.
American President Barack Obama on Tuesday extended the tenure of US Federal Reserve Chairman Ben Bernanke by another term.
Finance Minister Nirmala Sitharaman has said the recent interest rate hike by the Reserve Bank was not surprising for her but the timing was, asserting that the rising cost of funds will not impact the government's planned infrastructure investments. For the first time since August 2018, RBI had on May 4 delivered a blunt 40 basis points increase in key repo rate to 4.40 per cent, and also hiked the cash reserve ratio by 50 basis points to 4.5 per cent after an unscheduled meeting of the rate setting panel, citing increased inflation pressures following the Ukraine war and the resultant spike in crude oil prices. Retail inflation printed at 6.9 per cent in March and the April reading is forecast to top 7.7 per cent.
There are overvaluation and excesses in many pockets of the market. This is most obvious in the IPO market, where loss-making companies have inflicted large losses on investors, observes Debashis Basu.
The breadth, indicating strength of the market was strong
Noting that the United States economic recovery is still not strong enough, the Federal Reserve has said it would pursue with the proposed $600-billion government securities buyout plan.
