SGX Nifty up 10 points; here’s what changed for market while you were sleeping

Domestic stocks look set to open on a positive note on Thursday after the US Fed Chair Jerome Powell shrugged off inflation concerns and said the US economy was “still a ways off” from levels the central bank wanted to see before tapering its monetary support. Asian markets are mixed as investors await key China data due later in the day. The dollar eased from its recent peak. Oil prices extended losses. Here’s breaking down the pre-market actions:

STATE OF THE MARKETS

SGX Nifty signals a positive start

Nifty futures on Singapore Exchange traded 11.5 points, or 0.07 per cent, higher at 15,875, signaling that Dalal Street was headed for a positive start on Thursday.

• Tech View: Nifty50 formed a bullish candle on the daily chart on Wednesday and made a higher high-low formation for the third session, as supports shifted higher.
• India VIX: The fear gauge eased marginally to 12.59 level on Wednesday over its close at 12.62 on Tuesday.

Most Asian markets mixed in early trade

Asian share markets opened mixed on Thursday in cautious trade as investors eyed key China data due later in the day. MSCI’s broadest index of Asia-Pacific shares outside Japan was up by 0.30 per cent.

• Japan’s Nikkei declined 0.80%
• Korea’s Kospi gained 0.21%
• Australia’s ASX 200 gained 0.10%
• China’s Shanghai Composite shed 0.07%
• Hong Kong’s Hang Seng climbed 0.38%

Wall Street ended mostly higher

Stocks ended mostly higher on Wall Street as investors weighed the latest corporate earning reports and the Federal Reserve chair’s comments on inflation. The Dow Jones and S&P 500 ended with a gain after briefly hitting an intra-day record in a choppy session.

• Dow Jones added 0.13% to 34,933.23
• S&P 500 gained 0.12% to 4,374.30
• Nasdaq shed 0.22% to 14,644.95

Dollar retreats from recent peak

The dollar retreated from recent peaks on Thursday, following further reassurance from Federal Reserve chair Jerome Powell that he was in no rush to tighten policy, though losses were kept in check by investor nerves ahead of Chinese growth data.

• Dollar index inched up at 92.407
• Euro declined to $1.1833
• Pound slipped to $1.3840.
• Yen gained to 109.88 per dollar
• Yuan eased to 6.4613 against the greenback

Oil extends losses on hopes of more supplies

Oil prices extended losses on Thursday as investors braced for more supplies following a compromise between top OPEC producers and as US fuel stocks rose last week, raising concerns about demand at the world’s largest consumer. Brent crude futures for September dropped 44 cents, or 0.6 per cent, to $74.32 a barrel while US WTI crude for August was at $72.61 a barrel, down 52 cents, or 0.7 per cent.

FPIs sell shares worth Rs 1,304 cr

Net-net, foreign portfolio investors (FPIs) turned sellers of domestic stocks to the tune of Rs 1303.95 crore, data available with NSE suggested. DIIs, turned buyers to the tune of Rs 1335.91 crore, data suggests.

June quarter earnings

Wipro, Larsen & Toubro Infotech, Tata Elxsi, Cyient, Angel Broking, Tata Steel Long Products, Aditya Birla Money, Cyient, Rama Paper Mills and Rollatainers are among the companies that will announce quarterly earnings today.

MONEY MARKETS

Rupee: Halting its three-day winning run, the rupee on Wednesday declined by 10 paise to close at 74.59 against the US currency due to a stronger dollar in overseas markets and weak macro data.

10-year bond: India 10-year bond yield jumped marginally 0.1 per cent to 6.11 after trading in 6.1 – 6.22 range.

Call rates: The overnight call money rate weighted average stood at 3.18 per cent, according to RBI data. It moved in a range of 1.90-3.40 per cent.

DATA/EVENTS TO WATCH

• Q1 Earnings: Wipro | Angel Broking | Birla Money | Cyient | L&T Infotech | Tata Elxsi
• India Balance of Trade Final June (05:50 pm)
• China House Price Index YoY June (07:00 am)
• China GDP Growth Rate QoQ Q2 (07:30 am)
• China Industrial Production YoY June (07:30 am)
• China Unemployment Rate June (07:30 am)
• UK Employment Change April (11:30 am)
• US Initial Jobless Claims 10/July (06:00 pm)
• US Industrial Production MoM June (06:45 pm)
• US Fed Chair Powell Testimony (07:00 pm)

MACROS

Cabinet okays DA, DR hikes
The Union cabinet has approved an increase in dearness allowance (DA) and dearness relief (DR) for government employees and pensioners to 28% from 17% and continuation of a key export scheme for the textiles sectors. The increased DA and DR benefits come into effect from July 1, 2021, Union information and broadcasting minister Anurag Thakur said after a meeting of the cabinet chaired by Prime Minister Narendra Modi on Wednesday.

PV sales bounce back in June
Sales of passenger vehicles bounced back in June after a steep fall in the previous month, as operations returned to near normal at factories and dealerships with the second wave flattening out and states easing restrictions. Automakers dispatched 231,633 passenger vehicles to local dealerships the past month, compared with 88,045 vehicles in May and 105,617 units a year earlier, according to data released on Wednesday by the Society of Indian Automobile Manufacturers (SIAM).

Auto industry red-flags fuel price spike
The auto industry has raised a red flag over the spike in fuel prices and said that expensive petrol and diesel will hit demand for cars and two-wheelers, while leading to strong inflationary trends as freight costs go up. The concern comes at a time when the industry grapples with uncertainties around the coronavirus pandemic, and possibility of a third wave.

June WPI eases, but still in double digits
Wholesale price inflation eased marginally in June but remained in double digits for the third consecutive month, highlighting the price pressures in the economy against the backdrop of the Covid-19 pandemic. Data released by the department for promotion of industry and internal trade (DPIIT) on Wednesday showed inflation, as measured by the wholesale Price Index (WPI), eased to 12.1% in June, slower than the 12.9% in May. In the same period last year, it had posted a deflation of 1.8%

RBI bars Mastercard from taking new customers
Flexing its muscles on the issue of data localisation, RBI on Wednesday barred Mastercard from onboarding any new domestic customer from July 22. The directive bars the US-based network from issuing either prepaid, credit or debit cards to new customers in India. Mastercard is the second-largest credit card issuer (after Visa) in India and the central bank’s tough stance could have implications on foreign relations.