A softening inflation print has given rise to expectation the Reserve Bank of India might slow down pace and quantum of rate hikes in the coming months.
“There is comfort that aggressive rate hike cycle might just get over with one or two more cycles,” said Siddharth Khemka, head of retail research at Motilal Oswal Financial Services.
“The stance (by global central banks) may become softer gradually, and market is hoping for a softer landing, which is boosting sentiment across the world.”
Strong corporate June-quarter results, softening commodity prices and easing of consumer inflation has helped domestic mood, particularly in consumer and auto stocks, Khemka added.
The Nifty FMCG index rose to a record high, with Hindustan Unilever up 1.8%.
The Nifty Media index jumped 2.4% while the IT index was up 0.9%.
Foreign institutional investors have also been pumping money into Indian equities, having bought $2.83 billion worth of shares this month until Aug. 12, compared with an inflow of $618 million all through July, data showed.
Asian shares tracked solid Wall Street performance as strong overnight earnings for U.S. retail giants pointed to further scope for the Federal Reserve to tackle inflation with rate hikes.
Meanwhile, in domestic markets, shares of Mahanagar Gas Ltd fell as much as 3.8% after the company reduced prices of compressed natural gas and domestic piped natural gas in and around Mumbai.
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GLOBAL MARKET CHECK
- The Stoxx Europe 600 was little changed as of 9:11 a.m. London time
- Futures on the S&P 500 fell 0.3%
- Futures on the Nasdaq 100 fell 0.5%
- Futures on the Dow Jones Industrial Average fell 0.2%
- The MSCI Asia Pacific Index rose 0.4%
- The MSCI Emerging Markets Index rose 0.2%
FPIs stock holding slips 14% to $523 bn in Jun quarter: Report
This was the third consecutive quarterly decline in the value of FPIs’ investments in Indian equities.
Foreign investors were cautious since the start of the year and it intensified as the year progressed, following the influence of worrying trends in both global and domestic markets.
Top gainers from IT pack
Price as on 17 Aug, 2022 02:20 PM, Click on company names for their live prices.
Markets are just 3 to 4 percent off their life time highs. I think, clearly the sentiment along with liquidity & macro plus micro fundamentals are supportive for a long term rally but yes it will have its share of speed breakers & volatility. Clearly the day when US inflation came in at 9.1 percent, a lot more than expectations, markets factored in an aggressive rate hike and moved forward. While inflation & interest rates can still come & haunt the economies & markets, but a confluence of factors including low valuations be it P/E, P/BV, Mcap to GDP, oversold markets, the fall in commodity prices etc helped markets to move northwards. Add to it, crude from130 to 93, is a huge tailwind for our own economy & hence markets. The return of Foreign institutional investors, Credit growth in mid teens for the banking sector, decent monsoon, commentary on impending capex & above all the first quarter earnings season, which did not disappoint the street, were catalysts for this up move. With festive season in India for the next few months, revenge shopping, eating out & revenge travel, a lot of consumption oriented sectors would find favour & with credit growth and capex coming back, BFSI would also be a beneficiary.
– Devang Mehta, Head- Equity Advisory, Centrum Wealth on Sensex at 60k
European shares rose for a sixth straight session on Wednesday, lifted by financial stocks, with investors focusing on economic growth and inflation data due this week.The pan-European STOXX 600 inched up 0.2%, hovering near 10-week highs. All regional markets posted gains.
UTI AMC says not aware of any such negotiations/events in response to Tata AMC buying stake
Price as on 17 Aug, 2022 01:47 PM, Click on company names for their live prices.
Despite uncertain economic outlook, the global equity markets staged a smart comeback driven by better-than-expected Q2’CY22 earnings in US stocks and buying from set of investors positioning for an economic recovery rather than worrying about the potential for a recession. The US benchmark S&P 500 has rebounded about 15% since mid-June, halving its year-to-date loss, and the tech-heavy Nasdaq Composite is up more than 20%. Following these positive global cues domestic equity markets too staged a strong come back, with benchmark Nifty-50 gaining more than 15% from the lows in June-22 . The return of FII buying, flattening of inflation, softening commodity prices and good monsoon boosted investors sentiments. The encouraging macro readings (IIP up ~20%, GST collection, Rs1.44 lakh cr up 55.8%, moderating inflation 6.7%) and sound fundamentals are giving markets new-found hope despite fluctuations. The benchmark Nifty-50 has added over 2,500 points since lows in June. This sharp rally has pushed the valuation multiples near LT averages (20x+) which in our view makes risk reward less attractive amid uncertain global economic outlook and rising geopolitical tensions. While the domestic economy & earnings have showcased strong resilience, we remain caution at current valuations & suggest a staggered buying approach. Our stance is driven by A) Indian economy cannot stay fully immune to any global economic/ geopolitical shocks B) Inflation trajectory continue to remain elevated C) Global & domestic monetary policy tightening to continue D) The trend in domestic demand recovery not yet broad-based E) In case of a recession reality, the earnings in select sectors could take a major hit.
– Kedar Kadam, Director – Listed Investments, Waterfield Advisors
Top gainers from the banking index in afternoon session
Price as on 17 Aug, 2022 01:30 PM, Click on company names for their live prices.
Hinduja Group-owned NxtDigital rallied as much as 6 per cent during the early trade on Wednesday after the company board approved the merger of Hinduja Leyland Finance (HLFL) with itself.
Price as on 17 Aug, 2022 01:26 PM, Click on company names for their live prices.
Rupee upside capped by corporate outflows, Fed stance-analysts
The Indian rupee’s gains against the U.S. currency on Wednesday are likely to be stalled by dollar outflows by corportaes and the U.S. Federal Reserve’s hawkish outlook, some analysts said. The rupee was trading at 79.4250 per U.S. dollar by 0638 GMT, up from 79.6550 on Friday. The local currency had opened at 79.27. “The fall in oil prices and risk on sentiment has helped the rupee to appreciate. However, there are corporate outflows lined up of over a billion dollars that will create demand for the dollar in the system,” said Anindya Banerjee, head of research for forex and interest rates at Kotak Securities.
Investment demand to lift India’s silver imports to record high
India’s silver imports are set to triple in 2022 from a year ago to record highs after a dip in prices to 2-year lows spurred investors to bet that the metal was primed for a rebound and could outperform gold in the coming years. Higher demand in India, the world’s biggest silver consumer, could support global prices. “Investment demand has been boosting imports,” said Chirag Thakkar, CEO of Amrapali Group Gujarat, a leading silver importer. “Investors are anticipating poor man’s gold will beat gold in coming years.” India’s silver imports in 2022 could jump to a record 8,200 tonnes, Thakkar said.
The ferocity of this rally has proved wrong the majority of experts who believed that this is a bear market rally. It appears that the market may remain resilient. There is global support to this rally since Nasdaq and S&P 500 have rebounded by 24% and 18% from the June lows. Nifty too has rebounded 18% from the June lows. The decline in inflation has increased the possibility of a soft landing for the US economy. In India, the decline in inflation, declining crude, strong growth momentum, good monsoon and above all FIIs turning consistent buyers have turned the sentiments in favour of the bulls. However, high valuation is a concern.
– Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services
Ujjivan Small Finance Bank has raised interest rate on fixed deposits by up to 1.5 per cent. The new rates have come into effect from August 9, 2022. The bank said that on the occasion of the 75th year of India’s Independence, it has increased the rate on fixed deposits by 30-150 basis points (or 0.3-1.50 per cent) across different tenures.
Price as on 17 Aug, 2022 01:01 PM, Click on company names for their live prices.
Bharti Airtel has paid Rs 8312.4 crore to the Department of Telecommunications (DoT) towards dues for spectrum acquired in the recently concluded 5G auctions. Airtel has taken up the option to pay more upfront amount as against 20 equal annual instalments, paying four years of the 2022 spectrum dues upfront.
Price as on 17 Aug, 2022 12:23 PM, Click on company names for their live prices.
Syrma SGS Tech IPO sails through on Day 3, NII portion fully subscribed
The initial public offering (IPO) of Syrma SGS sailed through on Wednesday as the company received a decent response from the investors during the third day of the bidding process.The issue kicked off on Friday, August 12, and will remain open till Thursday, August 18. The company will be selling its shares in the range of Rs 209-220 apiece to raise Rs 840 crore through the primary route.
Global News: UK July consumer prices rise 10.1% YoY
#NewsAlert | UK July consumer prices rise 10.1% Y/Y est of 9.8% #CPI #CPIData #IIPData #IIP https://t.co/mXLnud7t13
— ET NOW (@ETNOWlive) 1660717755000
UPL and ORO Agri announce development and distribution agreement for orange oil multifunctional bioprotection product
Price as on 17 Aug, 2022 11:40 AM, Click on company names for their live prices.
Indian rupee higher on dollar inflows, risk-on sentiment
The Indian rupee strengthened against the U.S. currency on Wednesday, led by dollar inflows after the long weekend and an improvement in the overall risk sentiment. The rupee was trading at 79.33 per U.S. dollar by 0551 GMT, against 79.6550 on Friday. India’s forex and money markets were closed on Monday and Tuesday. Dollar credits received by Indian exporters following the long weekend, the healthy risk mood and dip in oil prices “helped rupee make up for last week’s underperformance,” said a trader at a private sector bank. Last week, rupee was among the worst performing Asian currencies.
I think it is a case of history repeating itself. Whenever Sensex has not entered a bear market, the reversal has been quite quick historically and the same has happened this time also. The icing on the cake is that unlike last time, the valuations are much more reasonable this time around. Although the broader market is by no means cheap, it isn’t prohibitively expensive either. Therefore, those looking for fundamentally strong stocks at attractive valuations could still find pockets of undervaluation.
– Rahul Shah, Co-Head of Research at Equitymaster
Techno Electric zooms 12% on bagging big orders
Shares of Techno Electric & Engineering Company (TEECL) zoomed more than 12 per cent during the early trade on Wednesday after the company bagged multi-million orders. In a regulatory filing, the construction and engineering company announced that it has secured two new orders for FGD for a total consideration of Rs 1,455 crore. Following the update, shares of TEECL rallied as much as 12 per cent to Rs 314.50 on Wednesday, before giving up some gains to trade at Rs 306.10 at 9.30 am. The scrip had settled at Rs 279.85 on Tuesday.
India bond yields drop on weaker oil, easing inflation
- Indian government bond yields declined, with the benchmark 10-year yield crashing 10 basis points on Wednesday, tracking a sharp fall in global oil prices that could further lower the inflation trajectory.
- The benchmark 10-year government bond yield was at 7.1966% as of 0455 GMT. It had fallen to 7.1947% earlier in the day, after closing at 7.2894% on Friday. Indian fixed income markets were shut on Monday and Tuesday for holidays.
- “The sharp fall in oil prices is a major relief as far as local inflation scenario is concerned, and hence there is a sharp rally in bond prices, even as July reading was largely along estimates,” a trader with a state-run bank said.
Experts disagreed on whether the ongoing rally is a bear market rally or the beginning of yet another bull market. The majority who believed that this is a bear market rally has been decisively proved wrong by the ferocity of the rally which has taken the Nifty to mere 4.3% away from the all-time high. It is important to appreciate the fact that there is global support to this rally with S&P 500 and Nasdaq bouncing back by 18 and 24% from their June lows. Declining US inflation, confidence that the Fed need not have to aggressively raise rates and the increasing probability of a soft landing of the US economy are supporting this rally. In India, steadily declining inflation, strong growth momentum in the economy and FIIs turning consistent buyers are driving the rally. Even though valuations are high it makes sense to remain invested and buy on dips.
– Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services
These stocks rally up to 16% in firm market
Price as on 17 Aug, 2022 10:28 AM, Click on company names for their live prices.
BLOCK DEAL IN STAR HEALTH: 10 lakh shares change hands
Price as on 17 Aug, 2022 09:58 AM, Click on company names for their live prices.
Though Nifty paused yesterday at 17835, we are not convinced that Nifty has topped out. This encourages us to continue riding the 18200 view, but with VIX slipping, trading ranges are indeed shrinking. Downside markers may continue to remain near 17660/690, with 17900vicinity likely to pose an intraday challenge.
– Anand James – Chief Market Strategist at Geojit Financial Services
BLOCK DEAL IN CESC: 72.3 lakh shares change hands
Price as on 17 Aug, 2022 09:41 AM, Click on company names for their live prices.
SENSEX HITS 60,000 FOR THE FIRST TIME SINCE APRIL 5
The state-owned lender SBI has filed an insolvency petition against the country’s largest sugar firm Bajaj Hindusthan Sugar. SBI as a financial creditor has filed the plea before the Allahabad bench of the National Company Law Tribunal (NCLT).
Price as on 17 Aug, 2022 09:21 AM, Click on company names for their live prices.
Most active stocks on NSE in opening deals
Price as on 17 Aug, 2022 09:20 AM, Click on company names for their live prices.
OPENING BELL: Sensex gains 100 points, Nifty above 17,850; Aarti Drugs rallies 10%, Bajaj Hind plunges 12%
Pre-open session: Sensex rises 30 points; Nifty above 17,820
Rupee opens up 0.48% at 79.28 per US dollar; previous close 79.655
Asian stocks solid and kiwi jumps on RBNZ rate hike
Asian shares tracked solid Wall Street performance on Wednesday as strong overnight earnings for U.S. retail giants pointed to further scope for the Federal Reserve to tackle inflation with rate hikes.
SGX Nifty signals a positive start
Nifty futures on the Singapore Exchange traded 17 points, or 0.10 per cent, higher at 17,873, signaling that Dalal Street was headed for a positive start on Wednesday.
Tech View: Nifty50 rises for 6th day, lacks margin of safety
Nifty50 on Tuesday rose for the sixth straight day. The index failed to capitalise on a gap-up start and remained range-bound before eventually ending up, forming an indecisive candle on the daily scale. There is no sign of reversal though.
Oil prices recover from 6-month lows after drop in U.S. stockpiles
Oil prices rose on Wednesday, recovering from six-month lows hit the previous day, as a larger-than-expected drop in U.S. oil and gasoline stocks reminded investors that demand remains firm, if overshadowed by the prospect of a global recession.
Tokyo stocks open higher on strong US retail readings
Tokyo stocks opened higher on Wednesday as investors took heart from strong US retail sector reports and worries eased over inflation. The benchmark Nikkei 225 index was up 0.40 percent, or 114.52 points, at 28,983.43 in early trade, while the broader Topix index advanced 0.46 percent, or 9.10 points, to 1,991.06.
Dow, S&P 500 climb as upbeat results from Walmart, others boost optimism
The Dow and S&P 500 rose on Tuesday as stronger-than-expected results and outlooks from Walmart and Home Depot bolstered views on the health of consumers, while technology shares declined and weighed on the Nasdaq.
Sensex, Nifty on Tuesday
The 30-share Sensex advanced 379.43 points to end at 59,842.21. Its broader peer, Nifty50, also ended the session comfortably above the 17,800 mark, led by auto realty and oil and gas scrips. Nifty50 posted its highest level since April 5 at close.