SGX Nifty down 20 points; here’s what changed for market while you were sleeping

STATE OF THE MARKETS

SGX Nifty signals a negative start

Nifty futures on Singapore Exchange traded 21 points, or 0.13 per cent, lower at 15,842.50, signaling that Dalal Street was headed for a muted start on Tuesday.

• Tech View: Nifty50 on Monday capitalised on a gap-up start and ended the day around the intraday high, thus forming a bullish candle on the daily scale.
• India VIX: The fear gauge eased marginally to 12.07 level on Monday over its close at 12.09 on Friday.

Asian markets mixed in early trade

Asian stocks opened mixed on Tuesday as investors sought fresh cues while keeping an eye on rising virus cases. Investors are waiting for the US market to reopen later Tuesday after the Independence Day holiday. MSCI’s broadest index of Asia-Pacific shares outside Japan was down by 0.08 per cent.

• Japan’s Nikkei gained 0.25%
• Korea’s Kospi climbed 0.45%
• Australia’s ASX 200 rose 0.22%
• China’s Shanghai Composite shed 0.20%
• Hong Kong’s Hang Seng declined 0.63%

European stocks settled higher

US stock markets remained closed on Monday on the account of Independence Day. As closing bells rang in the eurozone, Frankfurt stocks had risen by 0.1 per cent and Paris was up by 0.2 per cent. London advanced by 0.6 per cent, with sentiment boosted by news of a possible bidding war for British supermarket chain Morrisons.

• EURO STOXX 50 rose 0.1% to 4,087.37
• FTSE100 added 0.6% to 7,164.91
• DAX30 gained 0.1% to 15,661.97
• CAC40 advanced 0.2% to 6,567.54

Dollar steady ahead of Fed minutes

The US dollar and other majors were mostly steady as investors wait on the minutes from the Federal Reserve’s meeting in June when it surprised markets with a hawkish shift. They are due to be published on Wednesday.

• Dollar index held to 92.227
• Euro steady at $1.1860
• Pound gained to 1.3859
• Yen rose to 110.86 per dollar
• Yuan depreciates to 6.4612 against the greenback

Crude prices rise slightly

Oil prices rose slightly on Tuesday after the previous day’s rally, supported by expectations of a tighter market as output talks of OPEC+ nations were called off, but concerns that members may start to increase production capped gains. Brent crude was up 7 cents, or 0.1%, at $77.23. US West Texas Intermediate (WTI) crude futures were at $76.38 a barrel, up $1.22, or 1.6%, from Friday’s close.

DIIs buy shares worth Rs 646 crore
Net-net, foreign portfolio investors (FPIs) turned sellers of domestic stocks to the tune of Rs 338.43 crore, data available with NSE suggested. DIIs, turned buyers to the tune of Rs 645.59 crore, data suggests.

MONEY MARKETS


Rupee: The rupee surged by 43 paise, its best single-session gains in nearly three months, to settle at 74.31 against the US dollar on Monday, tracking stronger Asian peers against the American currency and a firm trend in the domestic equity market.

10-year bond: India’s 10-year bond yield jumped 0.38 per cent to 6.08 after trading in 6.06 – 6.09 range.

Call rates: The overnight call money rate weighted average stood at 3.12 per cent, according to RBI data. It moved in a range of 1.90-3.40 per cent.

DATA/EVENTS TO WATCH

• Japan Leading Economic Index Prel May (10:30 am)
• UK Halifax House Price Index MoM June (11:30 am)
• China Foreign Exchange Reserves June (01:30 pm)
• UK Labour Productivity QoQ Final Q1 (02:00 pm)
• UK BBA Mortgage Rate June (03:30 pm)
• US FOMC Minutes (11:30 pm)

MACROS


RBI announces first GAP purchase
RBI on Monday said the first purchase of government securities for an aggregate amount of Rs 20,000 crore under the G-sec Acquisition Programme will be conducted on July 8. On June 4, RBI Governor Shaktikanta Das had announced that the central bank will conduct open market purchase of government securities of Rs 1.2 lakh crore under the G-SAP 2.0 in the second quarter of 2021-22 to support the market.

Services sector see sharpest contraction
Ravaged by the second wave of the pandemic, activity in the country’s crucial services sector contracted at its sharpest pace in nearly one year in June as firms witnessed decline in sales and output. Registering 41.2 in June, the India Services Business Activity Index highlighted a further contraction in output. Falling from 46.4 in May, the latest reading pointed to the fastest rate of reduction since July 2020.

Jet staff need to back Jalan-Kalrock revival plan
At least 95% of Jet Airways employees need to vote in favour of the package offered to them in the NCLT-approved Jalan-Kalrock revival plan for the airline or lose out the same. A five-page form has been sent to employees outlining what all they would be entitled to — including a cash payment of Rs 11,000 to Rs 22,800 to each Jet employee — and they have to vote from Monday (July 5) till August 4, 2021, “for ascertaining the approval or rejection of the consortium’s proposal”.

Slowing monsoon may raise food prices
The slowing monsoon and pace of crop sowing could cause food prices to surge in India, mounting pressure on its monetary policy mechanism to review the cost of debt funds. Experts, though, believe the central bank will desist from immediately raising rates to bolster fragile recovery in an economy that faces palpable risks of a third viral wave. Several states have reportedly urged farmers to delay sowing of the kharif, or summer-sown, crop this season, with total cropped area shrinking to 20.3 million hectares by June 25, from 25.9 million hectares in the same period last year.

Govt to slap fines on pesky callers
Unable to effectively control the menace of pesky callers and unsolicited messaging, the government has finally decided to slap financial penalties on offenders, also putting in place a mechanism to dismantle the infrastructure of repeated troublemakers, including disabling their numbers and mobile devices. The maximum penalty has been fixed at Rs 10,000 per violation, and the telecom department has created two special wings — digital intelligence unit (DIU) and telecom analytics for fraud management and consumer protection (TAFCOP) — to track crimes committed through telecom networks.

Select firms dole out big pay hikes
Companies across several sectors handed out competitive salary increments to their employees this year despite a raging second wave of Covid-19, with BFSI, healthcare and allied industries, and IT and knowledge services leading the way with double-digit hikes. Companies in BPO and IT-enabled services, e-commerce, tech startups and FMCG industries followed closely with average salary increments upwards of 8%, according to TeamLease Jobs and Salaries Primer Report 2021.