Domestic stocks looked set to open higher on Friday, tracking positive cues from Asian peers. But the gains, if any, could be limited as the rupee has slipped against a dollar at 74 level in an eight-day battering, raising concerns over FPI outflows. A mixed close for US stocks overnight was not encouraging either. Here’s breaking down the pre-market actions:
STATE OF THE MARKETS
SGX Nifty signals a positive start
Nifty futures on Singapore Exchange traded 59 points, or 0.38 per cent, higher at 15,751.50, signaling that Dalal Street was headed for a positive start on Friday.
- Tech View: Nifty50 on Thursday formed a bullish candle on the daily chart. It was the second day when the index made a lower high-low formation.
- India VIX: The fear gauge jumped 3 per cent to 15.29 level on Thursday over its close at 14.86 on Wednesday.
Asian markets gain in early trade
Asian markets opened higher on Friday helped by rallies in US high-tech shares, with investor focus shifting to the Bank of Japan’s policy decision later in the day. MSCI’s broadest index of Asia-Pacific shares outside Japan was up by 0.25 per cent.
- Japan’s Nikkei gained 0.34%
- Korea’s Kospi inched up 0.07%
- Australia’s ASX 200 rose 0.51%
- China’s Shanghai Composite up 0.04%
- Hong Kong’s Hang Seng jumped 1.08%
US shares ended mixed
Conviction in the strength of the economic recovery pushed investors into US technology stocks on Thursday, driving the Nasdaq Composite higher, although a post-Fed hangover left a subdued S&P500 nursing a very minor loss.
- Dow Jones declined 0.62% to 33,823.45
- S&P 500 retreated 0.04% to 4,221.86
- Nasdaq added 0.87% to 14,161.35
Dollar headed for best week
The dollar was headed for its best week in nearly nine months on Friday as investors have scrambled to price in a sooner-than-expected ending to extraordinary US monetary stimulus in the days after a surprise shift in tone from the Federal Reserve.
- The dollar index zoomed to 92.010
- Euro declined to $$1.1904
- Pound fell to a low of $1.3936
- Yen stood at 110.82 per dollar
- Yuan at 6.4439 against the greenback
Q4 earnings today
Gujarat Fluorochemicals, Dhani Services, Timken India, The Fertilizers and Chemicals Travancore, Hinduja Global Solutions, RattanIndia Enterprises, Ashoka Buildcon and Eveready Industries India are among the companies that will announce their March quarter results today.
FPIs sell shares worth Rs 880 crore
Net-net, foreign portfolio investors (FPIs) turned sellers of domestic stocks to the tune of Rs 879.73 crore, data available with NSE suggested. DIIs, turned buyers to the tune of Rs 45.24 crore, data suggests.
Rupee: Declining for the eighth consecutive session, the Indian rupee tumbled 76 paise to close below the 74-mark against the US dollar on Thursday, tracking a strong greenback overseas after the US Federal Reserve surprised the market by signalling rate hikes sooner than expected.
10-year bonds: India 10-year bond yield eased 0.43 per cent to 6.02 after trading in 6.01 – 6.07 range.
Call rates: The overnight call money rate weighted average stood at 3.20 per cent, according to RBI data. It moved in a range of 1.90-3.45 per cent.
DATA/EVENTS TO WATCH
- India Bank Loan Growth YoY June/04 (5:00 pm)
- India Deposit Growth YoY June/04 (05:00 pm)
- India Foreign Exchange Reserves 11/June (05:00 pm)
- RBI Monetary Policy Meeting Minutes
- Monetary Policy Meeting Minutes (05:00 pm)
- Japan BoJ Interest Rate Decision (08:30 am)
- UK Retail Sales MoM May (11:30 am)
Nadella now Microsoft top boss
Satya Nadella has been elevated as chairman of Microsoft, a recognition of how dramatically he has transformed the world’s largest software maker as chief executive over the past seven years. He will continue to also hold the CEO position. This makes it the first time since 2000, when co-founder Bill Gates stepped down as CEO, that the same person is holding both positions, demonstrating the company’s confidence in Nadella’s ability to take it into the future.
SEC again delays call on Bitcoin ETF
US regulators have once again punted their decision on whether to approve a Bitcoin ETF. The SEC said in a Wednesday regulatory filing that it will seek more public comment on a proposal to list a product on Cboe Global Markets. It’s the second time this year that the SEC has delayed giving an answer to the legions of crypto advocates pushing for a way to trade the largest cryptocurrency in an exchange-traded fund format.
India 43rd in competitiveness index
India maintained 43rd rank on an annual World Competitiveness Index compiled by the Institute for Management Development (IMD) that examined the impact of COVID-19 on economies around the world this year. The 64-nation list was led by Switzerland, while Sweden has moved up to the second position (from sixth last year), Denmark has lost one place to rank third, the Netherlands has retained its fourth place and Singapore has slipped to the fifth place (from first in 2020).
India’s forex reserve not enough
India’s foreign exchange reserves, which recently crossed the $600 billion mark for the first time, maybe deceptive as it will be adequate to finance less than 15 months’ actual imports in FY22 against 20 months’ at current levels, a Reserve Bank of India research paper has said. “In terms of projected imports for 2021-22, the current level of reserves provides cover for less than 15 months, which is lower than for other major reserve holders,” warns the paper authored by RBI deputy governor Michael Patra and his team of economists
Banks try to ease NPA resolution process
Banks soon won’t need to approach the overseeing committee to get resolution plans for stressed assets vetted, a measure that could shorten the time taken for dealing with nonperforming assets. The Indian Banks’ Association will write to its members advising them to drop the standard clause in the inter-creditor agreement that calls for this, said a senior executive aware of developments.