Back
PremiumIndices across the globe shed on Thursday as Fed hinted at an aggressive stance against inflation in the future. Asian stocks lost ground with Nikkei and Hang Seng losing substantial ground. Europe was also trading in red in the morning session.
Indian benchmark indices tumbled on Thursday and lost 0.5% in a volatile session. Fed's hawkish tones with regard to future hikes made investors across the globe nervous and most of the indices lost ground on Thursday.
Sensex slipped 337 points to close at 59,119, while Nifty conceded 88 points to end at 17,629. Rupee dipped 51 paise during the day and reached an all-time low of 80.47 against the dollar.
Powergrid, HDFC Bank and Axis Bank shed more than 2% in today's trading. On the other side, Titan, Hindustan Unilever and Asian Paints featured among prominent gainers.
Among indices, FMCG and Media were the only ones to remain stable in today's session. Banks and Financial Services tumbled more than a per cent in today's session.
Japanese shares on Thursday closed at their lowest in more than two months, as investors reacted to the Fed's rate hike and Bank of Japan's decision to maintain its ultra-easy monetary policy. The Nikkei 225 index ended down 0.58%.
Hong Kong stocks dropped to a near 11-year low on Thursday while bargain-hunting helped limit losses in mainland China shares.
Hong Kong equity benchmark Hang Seng fell 1.6% to 18,147.95, the lowest closing level since Dec. 20, 2011. In mainland China, the blue-chip CSI300 index fell 0.9%, while the Shanghai Composite Index dipped 0.2%.
European shares opened lower on Thursday with tech stocks leading the declines. The pan-European STOXX 600 index shed at open.
Baba Ramdev-backed Patanjali Foods share price took a pause today and witnessed some profit booking after climbing to life-time highs on Tuesday and Wednesday sessions. Patanjali Foods share price today opened with a downside gap and went on to make its intraday low of ₹1,426 on NSE. However, ICICI Direct believes that such dip in the stock is temporary and the stock may maintain its upside momentum. The brokerage has suggested long-term investors to buy this Baba Ramdev-backed multibagger stock for long term target of ₹1,750 apiece levels. (Read More)
Indian refiners are set to skip purchases of Russia ESPO crude oil this month due to higher freight rates, turning to Africa and the Middle East instead, industry sources said.
India, which rarely used to buy Russian oil, has emerged as Moscow's second biggest oil customer after China since Moscow's invasion of Ukraine in late February.
Refiners in India have been snapping up nearly all grades of Russian crude, taking advantage of discounts after some entities in the West halted purchases.
However, higher prices are set to cool off Indian demand, channeling supplies to China. (Reuters)
Japan’s central bank took the unusual step Thursday of intervening in the market to stem the yen’s decline against the U.S. dollar.
Earlier in the day, the dollar rose to 146 yen — a 24-year low — after the Bank of Japan left its key lending rate unchanged following the U.S. Federal Reserve's decision to raise its benchmark rate by three-quarters of a percentage point.
The dollar later fell sharply to about 142 yen.
Masato Kanda, the vice minister of finance for international affairs, confirmed the intervention to local reporters. However, it was unclear exactly what form it took, and the BOJ does not usually announce such moves itself. (AP)
Gold price in the national capital rose by ₹442 to ₹50,399 per 10 grams on Thursday amid a rise in international precious metal prices and sharp rupee depreciation, according to HDFC Securities.
In the previous trade, the yellow metal had closed at ₹49,957 per 10 grams.
Silver also climbed by ₹558 to ₹58,580 per kilogram from ₹58,022 per kg in the previous trade. (PTI)
Hong Kong stocks dropped to a near 11-year low on Thursday as another hefty U.S. interest rate hike hurt risk appetite, while bargain-hunting helped limit losses in mainland China shares.
** Hong Kong equity benchmark Hang Seng fell 1.6% to 18,147.95, the lowest closing level since Dec. 20, 2011.
** In mainland China, the blue-chip CSI300 index fell 0.9% to 3,869.34 points, while the Shanghai Composite Index dipped 0.2% to 3,108.91 points. (Reuters)
Toyota Motor Corp said on Thursday it plans to produce about 800,000 vehicles worldwide in October, about 100,000 short of its average monthly production plan, due to semiconductor shortages.
The world's largest automaker by sales said last month it aimed to produce about 900,000 vehicles per month from September through November. (Read More)
Airlines under the Tata umbrella have signed a memorandum of understanding with the Council Of Scientific And Industrial Research–Indian Institute Of Petroleum (CSIR–IIP) to collaborate and work together on research, development and deployment of sustainable aviation fuels. (Read More)
Shares of Fortis Healthcare sank nearly 20% on Thursday and eyed their biggest slide in nearly 15 years, after reports said India's top court ordered the continuation of a stay on IHH Healthcare's open offer for the company.
The Supreme Court also remanded the issue of the Fortis-IHH deal to the Delhi High Court and directed it to consider a forensic auditor's appointment, CNBC TV-18 reported.
Reuters was not immediately able to review the order.
IHH had won a bid for a 31% stake in Fortis in 2018, which triggered an open offer for another 26% as per Indian regulations. (Reuters)
India will be an outperformer across emerging markets (EMs) regardless of whether the US and European economies tip into recession, according to Paul Gruenwald, global chief economist, S&P Global.
“I think India will continue to be an outperformer. If you do a country ranking across emerging markets, India will definitely be in the top bucket, regardless of what scenario we are in," Gruenwald said.
This is because, unlike other EMs, India’s economy is driven by domestic demand rather than being export-led and also because it is not interlinked strongly with other economies. (Read More)
UK shares on Thursday tracked weakness in European and Asian peers after the U.S. Federal Reserve delivered another 75-basis-point interest rate hike, with investors bracing for a second outsized hike by the Bank of England later in the day.
The blue-chip FTSE 100 index slid 1.0% by 0706 GMT, while the domestically focussed mid-cap index declined 1.1%.
UK's central bank looks set to raise rates by at least half a percentage point in a bid to tame inflation, which is just off a 40-year high. The BoE had delayed its announcement by a week due to the national mourning following Queen Elizabeth's death.
Economists polled by Reuters expect the BoE to raise rates to 2.25% from 1.75%, while financial markets see a 92.4% chance of a bigger move to 2.5%.
Rate-sensitive banks and insurance shares fell 1.4% and 1.7%, respectively, leading losses on the benchmark FTSE 100 index. (Reuters)
The apex edible oil industry associations from five major palm oil importing countries in Asia have come together for the first time to form an alliance -- Asian Palm Oil Alliance (APOA).
The alliance commits to work worldwide to ensure that palm oil is recognised as a high-quality, economical, and healthy vegetable oil and to change the negative image of palm oil, a statement by India's edible oil industry body The Solvent Extractors' Association of India said on Thursday.
The alliance is between industry bodies of India, Pakistan, Sri Lanka, Bangladesh and Nepal.
In the coming year, the membership would be further expanded to include other select companies or industry organisations operating in the production or refining of palm oil across the continent. (ANI)
Around 20% salary hike will be given to SpiceJet pilots in October this year, the company told news agency ANI. This salary revision follows a 6% hike announced last month. It has also decided to place certain pilots on leave without pay (LWP) for a period of three months as a temporary measure to rationalize costs. (Full Story)
India has defended its decision to ban export of wheat and rice at a WTO meeting even as some member countries have flagged concerns over the country's stand, an official said.
At a meeting last week in Geneva, Senegal, the US and the European Union raised questions over this decision, stating it could have adverse implications on global markets.
In May, India restricted export of wheat to enhance domestic availability. This month, it also banned export of broken rice and imposed a 20 per cent export duty on non-Basmati rice except for parboiled rice to boost domestic supplies amid a fall in area under paddy crop in the current kharif season.
Defending its decision, India clarified that the ban on export of broken rice, which is used in poultry feed, follows a rise in the grain's exports in recent months which put pressure on the domestic market. (PTI)
Japanese shares on Thursday closed at their lowest in more than two months, as investors reacted to the U.S. Federal Reserve's hawkish projections and the Bank of Japan's decision to maintain its ultra-easy monetary policy.
The Nikkei 225 index opened down 0.95% and fell through the 27,000-mark for the first time since July 19. It later recovered slightly and ended down 0.58% at 27,153.83. The broader Topix fell 0.25%.
The Nikkei's slide tracked broad losses on Wall Street after the Fed delivered a widely expected 75-basis-point rate increase and signalled no letup in its approach to tackling inflation, forecasting more substantial hikes on its "dot plot" chart. (Reuters)
Naveen Kulkarni, Chief Investment Officer, Axis Securities PMS: With the US Fed increasing rates by 75 bps and hinting at more rate hikes in the future, we believe the Dollar index can see a significant increase, implying most major market currencies, including INR should be under pressure. If we start seeing INR depreciating, then from a USD returns perspective for FPIs, India becomes unattractive. We could also witness a reversal of FPI flows in the near to medium term, which will increase market volatility. Higher interest rates in the US will force major central banks, including India, to increase interest rates to stem the pressure on their domestic currencies and with increased interest rates and cost of capital, market multiples can contract. We believe in the near term, Indian equity markets can witness increased volatility.
Oil & Gas and Bank indices are dragging the market, whereas FMCG is holding steady
Shares of Gujarat Mineral Development Corporation (GMDC) Ltd started trading ex-dividend in Thursday's trading session, a day ahead of the record date for its declared dividend of ₹4.30 per equity share for the year FY 2021-22. GMDC shares were trading about 0.5% lower at ₹146 apiece on the BSE in early deals. (Read More)
Oil rose after a two-day drop as investors weighed the outlook for demand following another interest-rate hike from the Federal Reserve.
West Texas Intermediate futures edged toward $84 a barrel after falling more than 3% over the past two sessions. Chair Jerome Powell vowed officials would crush inflation after they boosted rates by 75 basis points for a third straight time. The hike offset Russia’s escalation of its flagging war in Ukraine.
Thin liquidity has exacerbated price swings for oil, leading to wild volatility at times. Crude remains on track for its first quarterly decline in more than two years on concerns that demand may be crimped by an economic slowdown. (Bloomberg)
Singapore-based foreign institutional investor Nav Capital VCC- Nav Capital Emerging Star Fund has bought stake in small-cap company EP Biocomposites Ltd. After this stock market newsbreak, EP Biocomposites shares opened with an upside gap in early morning deals and hit upper circuit within few minutes of the opening bell. (Full Story)
Prime Minister Narendra Modi has set a very ambitious desire to get the India-UK Free Trade Agreement signed by Diwali and his new British counterpart Liz Truss wants her administration to "match the pace and ambition" of the Indian leader, UK Foreign Secretary James Cleverly has said.
Cleverly also said that the bilateral relationship between India and UK is longstanding and wide-ranging, which is both a "huge plus" but it also means that "quite understandably there is a desire to have a very, very wide-ranging, meaningful free trade agreement."
"Obviously, Prime Minister Modi has set a very ambitious desire to get a free trade agreement signed by Diwali. Now that means that both us and Indian negotiators are going to have to work very, very hard but we are very willing to do so," Cleverly told PTI in an interview here Wednesday on the margins of the high-level UN General Assembly session. (PTI)
Shares of Tata Consultancy Services (TCS) and Infosys have fallen significantly this year amid the underperformance of the Indian IT stocks as analysts see more pain for the sector and a potential slowdown in dollar revenue growth in the face of impending macroeconomic stress. The IT index has been one of the worst hit sectors, falling over 27% so far this year, underperforming benchmark Nifty 50 index. (Read More)
Surging share prices of Gautam Adani’s companies have helped make him the world’s second-richest person. The bond market isn’t quite as enthusiastic.
In the debt market, Adani Ports’ dollar bonds have dropped more than Indian peers on concern about the group’s debt, and its notes due in August 2027 fell to an all-time low this week, Bloomberg-compiled prices show. Bonds of group companies including Adani Green Energy Ltd. and Adani Transmission Step-One Ltd. also mostly underperformed the broader Indian market.
The diverging moves suggest that high debt poses risks to Adani’s success story that saw his net worth shoot up to only trail Elon Musk’s, the Bloomberg Billionaires Index shows. (Read More)
Sameet Chavan, chief analyst-technical and derivatives, Angel One Ltd: Technically speaking, the index seems tentative at higher levels and again slipped in the broad consolidation range. However, the undertone is likely to remain in favor of the bulls, and as far as levels are concerned, the 17820-17860 zone still holds the sturdy wall for the index and any persistent breakthrough could only open the gates for further upside. On the flip side, 17540 - 17500 has seen some strong resurgence in providing vital support and thus could be seen as a crucial juncture to add longs for intraday dips, while the sacrosanct support lies at the 17400 mark.
Going forward, the market is likely to remain volatile, mirroring the global bourses. We reiterate to keep a close tab on the mentioned levels. Also, one should continue with the stock-specific approach, as even though the indices may not be doing much, the individual stocks are not at all short of action. Hence one should continue to identify such potential movers and trade accordingly.
Tirthankar Das, technical & derivative analyst, retail, Ashika Stock Broking Ltd: On the technical front, small negative candle was formed in Nifty in daily time frame following sharp reactionary correction for the past two consecutive days indicating broader range consolidation in the market. Market breadth too turned negative. The 14-period RSI turned weak trading below the 60-level mark. Overnight Fed raised rates sharply, by 75 basis points - the third such rise in a row against which US Indices see-sawed before slumping to end all three benchmarks down by more than 1.7%, coming back to Indian market, with the fading of the event risk one cannot deny that secondary corrections are a part of the bull market which would pave the way for next leg of up move. Though one need to avoid trading aggressively in the market but the risk of a bare minimum correction of 23.6% of the entire rally from 15,183 to 18,096 comes around 17415 followed by 38.2% correction at 16990 remains. During the day index is likely to open with a huge gap down, traders during the day should show patience and wait for Index to cool-off. As long as the all-important support level of 17350 remains strong, the medium-term outlook in the Index to remain positive.
The rupee depreciated 51 paise to an all-time low of 80.47 against the US dollar in early trade on Thursday after the US Federal Reserve's interest rate hike and its hawkish stance weighed on investor sentiments.
At the interbank foreign exchange, the local currency was trading at 80.47 against the dollar, down 51 paise from its previous close. The rupee opened at 80.27 and touched a record low of 80.47 a dollar in initial deals.
Forex traders said the strength of the American currency in the overseas market, a muted trend in domestic equities, risk-off moods and firm crude oil prices weighed on the local unit.
On Wednesday, the rupee declined 22 paise to close at 79.96 against the dollar. (PTI)
Sahaj Agrawal, head of research- derivatives at Kotak Securities: “Nifty has been in a corrective phase since the last few trading sessions. We have not seen a short term reversal attempt succeeding and hence maintain a negative bias for the near term. Monthly support is only seen at 17000. US Fed comments are expected to keep volatility high in the near term. Expect consolidation to correction in the near term as the broader market sentiment has also turned negative. FII and PRO positions also suggest reduction in net shorts suggesting limited downside in near term. For Nifty, maximum OI buildup seen at 17000 Put and 18000 Call Option. For Bank-Nifty, maximum OI buildup is seen at 40500/41000 put and 41500/42000 call options. For the expiry day, expect nifty to trade with resistance of 17950 – any move above the same can invite short covering."
Anand James - chief market strategist at Geojit Financial Services: The feeble bounce off 17700 vicinity did not inspire confidence in extending upsides. Neither did the distribution pave way for a collapse. But we have been trading closer to +2 standard deviation band of the last 100 days for a while, which has increased the odds of a turn lower. Meanwhile, prospects of surprise bounce back will improve, should Nifty float above or pull back from below 17560. Else, expect 17000, which is in the vicinity of the 200-day sma, to keep pulling prices lower.
Nifty weekly contract has highest open interest at 18100 for Calls and 17100 for Puts while monthly contracts have highest open interest at 18100 for Calls and 17400 for Puts. Highest new OI addition was seen at 18000 for Calls and 17500 for Puts in weekly and at 18000 for Calls and 17500 for Puts in monthly contracts. FIIs increased their future index long position holdings by -4.17%, increased future index shorts by 15.11% and in index options by 15.19% in Call longs, 6.80% in Call short, 36.36% in Put longs and -5.01% in Put shorts.
The Initial Public Offer (IPO) of Harsha Engineers International got subscribed 74.70 times, led by strong demand from institutional buyers, on the last day of subscription that closed on Friday. The public issue received bids for 125.96 crore shares against 1.68 crore shares on offer, according to a data with the NSE.
The finalisation of the share allotment of Harsha Engineers IPO has been done. As per market observers, Harsha Engineers shares are available at a premium (GMP) of ₹170 in the grey market today. The company's shares are expected to list on leading stock exchanges BSE and NSE on Monday, September 26, 2022. (Read More)
Gold and silver prices in India fell today in tandem with a drop in international prices. On MCX, gold futures were near 7-month lows of ₹49,321, down 0.25%, while silver fell 0.4% to ₹57,059 per kg. In global markets, spot prices of gold fell 1% to $1,656.97 per ounce, buffeted by a strong dollar and firm bond yields after US Federal Reserve overnight increased interest rates by another 75 basis points and signalled more hikes. US Treasury two-year yields, which closely track the Fed rates, rose further above 4% to the highest since 2007. (Full STory)
Liquidity in India's banking system is likely to remain in deficit in the second half of this financial year as credit growth picks up and the circulation of currency notes rises, analysts said.
The country's banking liquidity slipped into deficit on Tuesday for the first time in over three years, according to data from the Reserve Bank of India.
A widening liquidity deficit could lead to a rise in short-term borrowing rates and prompt the Reserve Bank of India to pump in money into the banking system through repo auctions and slow down its interventions in the currency market. (Reuters)
The board of directors of IT company, Saksoft Ltd has fixed record date for stock split. The board of debt-free company has fixed 26th September 2022 as record date for subdivision of company stocks. The digital service provider company has already approved and declared stock split in 1:10 ratio announcing subdivision of existing equity shares from one equity share of ₹10 each into 10 equity shares of ₹1 each. (Read More)
Asian stock markets followed Wall Street lower on Thursday after the Federal Reserve delivered another big interest rate hike to cool galloping inflation and raised its outlook for more.
Shanghai, Tokyo, Hong Kong and Sydney declined. Oil prices gained.
The Shanghai Composite Index lost less than 0.1% to 3,115.94 and the Nikkei 225 in Tokyo slid 0.9% to 27,060.89. Hong Kong's Hang Seng tumbled 1.9% to 18,094.62.
The Kospi in Seoul sank 1.4% to 2,315.24. New Zealand edged up 0.1% while Southeast Asian markets declined. (AP)
Dr V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services: "While the Fed’s 75bp rate hike and reiteration of the hawkish message were on expected lines, indication that the terminal rate is likely to be 4.6% was higher than market expectations. US 10-year bond yield spiking above 3.5% and the dollar index above 111 are unnerving for equity markets. Now the market feels that the probability of a US recession has increased to 75%. In the backdrop of sharply slowing Eurozone and China, this is bad news for global growth.
The big question from the Indian market perspective is whether India’s outperformance will continue in the present global risk off context. Investors can remain optimistic but be cautious since India’s valuations are on the higher side. Financials, capital goods, select autos, telecom and construction related stocks can be bought on declines."
Cryptocurrency prices today came under pressure after the US Federal Reserve delivered another big interest-rate hike and warned of economic pain from the aggressive policy tightening still to come. The Fed’s determination to raise rates to levels that hammer inflation at the cost of sliding asset prices sent a chill across global markets. (Read More)
The Nifty could gap down by around 150 points or 0.8% at the opening, cues from its derivative SGX Nifty show. This comes after the US Fed delivered the third straight 75 basis point hike overnight, taking the Fed Funds Rate to 3-3.25% range, the highest since before the 2008 Global Financial Crisis, and as priced in by the markets. (Full Story)
STOCK IN FOCUS
Prince Pipes (CMP Rs.594)
In view of the healthy volume and series of strategies for the next level of growth, we have our BUY rating on the stock, with a Target Price of Rs700.
Intraday Picks
EICHERMOT (PREVIOUS CLOSE: 3682) SELL
For today’s trade, short position can be initiated in the range of ₹3700-3730 for the target of Rs.3600 with a strict stop loss of ₹3800.
JSW STEEL (PREVIOUS CLOSE: 685) SELL
For today’s trade, short position can be initiated in the range of ₹690-696 for the target of Rs.670 with a strict stop loss of ₹702.
NTPC (PREVIOUS CLOSE: 169) BUY
For today’s trade, long position can be initiated in the range of ₹165- 167 for the target of Rs.172 with a strict stop loss of ₹163.
Ambuja Cements, Delta Corp, RBL Bank, PVR, Can Fin Homes, and Escorts Kubota will be under the F&O ban list for Thursday. These stocks will be under the ban for the F&O segment as they have crossed 95% of the market-wide position limit (MWPL), as per the NSE. (Read More)
The telecom department has put the Draft Indian Telecommunications Bill, 2022 up for stakeholder comments, by October 20, under which the framework for mergers and acquisitions will be simplified and relief, write-off or deferment of dues may be allowed in cases of payment default in extraordinary circumstances.
The bill seeks to simplify the framework for mergers, demergers and acquisitions, or other forms of restructuring, by only requiring intimation to the licensing authority. (Read More)
Reliance Retail is in advanced talks to get the rights for beauty retailer Sephora in India, two people familiar with the development said. The move could see Sephora operations transfer from Arvind Fashions Ltd., its current partner, to Reliance Retail. Arvind Fashions holds Sephora’s master franchise rights for India.
The move comes as Reliance Retail sets its eyes on the beauty and personal care market in India after dominating the apparel retail segment in the country. India’s beauty retail market is expected to reach ₹2 trillion by 2025 driven by a higher propensity to shop online. (Full Story)
The Indian rupee is seen hitting a record low against the dollar on Thursday after the U.S. Federal Reserve hiked rates by 75 basis points on Wednesday and indicated more large rate hikes.
The rupee is expected to open around 80.25-80.30 per U.S. dollar in early trades, down from 79.9750 in the previous session. The previous record low for the local unit was 80.12 reached late in August.
The Fed's interest rate projections were "way more hawkish than expected" and the "damage we are seeing on Asian currencies should see rupee move comfortably below 80 at open", a trader at a Mumbai-based bank said.
"It is quiet clear that what happens after the open will depend upon the RBI (Reserve Bank of India)," the trader said.
The RBI had swiftly intervened when rupee dropped below 80, according to traders. (Reuters)
Shares of Jyoti Resins and Adhesives are one of the multibagger stocks in India. This multibagger chemical stock recently trade ex-bonus that turned out like icing on the cake for long term shareholders of the company. This was the first occasion when the chemical stock has given bonus shares in 2:1 ratio that means two bonus shares for each shares held by its shareholders. In last five years, this chemical stock has surged from ₹25 to ₹1,656 apiece levels, appreciating more than 6,500 per cent in this period. (Read More)
Kishore Biyani's Future Enterprises announced defaulting on over ₹15.73 crore interest dues on non-convertible debentures (NCDs). The due date for payment of interest on NCDs was September 20, 2022. These debentures are secured and in two series. On Wednesday, the company's shares witnessed upside despite broader bearish markets.
The interest was due on Rated, Listed, Secured, Redeemable, Non-Convertible Debentures in series XVI-C and series XVI-D. There are four investors in both series as on the date of default. ( Full Story)
India's palm oil imports in 2022/23 could jump 9% from a year earlier on a rise in domestic consumption and as competitive prices allow the tropical oil to regain its share in the world's biggest market, a Reuters survey showed on Wednesday.
The higher buying could help top producer Indonesia in bringing down ballooning inventories and support benchmark Malaysian palm oil prices, which have nearly halved from record highs earlier this year.
Palm oil imports in the new marketing year starting from Nov. 1 could rise to 8.4 million tonnes from 7.7 million tonnes this year, according to the average estimate of nine dealers and one industry official polled on the sidelines of the Globoil conference in Agra.
"Consumption will improve in the new year as prices have corrected and demand has also been rising with opening up of the economy," B.V. Mehta, executive director of Solvent Extractors' Association of India, said.
Indian demand weakened this year due to COVID lockdowns and record high edible oil prices, he said. (Reuters)
Download the App to get 14 days of unlimited access to Mint Premium absolutely free!
