Global markets: SGX Nifty to US bank stocks — key triggers that you should know

Global market update: The US stock was bouncing between gains and losses on Monday, as the yield on the two-year Treasury note plunged in its biggest one-day slump in decades, while tech stocks rebounded from last week’s rout as the collapse of Silicon Valley Bank reverberated across trading desks. However, trading halted in multiple number of bank stocks in the US markets in early morning session on Monday. After nosediving from 106 levels in last three sessions, US dollar rates have witnessed some pull back rally in morning deals on Tuesday but bond yield extended its rally in early morning deals.

Here we list out important triggers that may dictate Indian stock market today:

US stock market

US stocks closed mixed on Monday in a volatile trade, but bank shares plunged on fears that the collapse of Silicon Valley Bank (SVB) could spark contagion throughout the banking system. Dow Jones shed 0.28 per cent, S&P 500 index went off 0.15 per cent while Nasdaq index advanced 0.45 per cent on Monday.

Trading in over 30 bank stocks were halted in early morning session on Monday after slump in share prices of those banking stocks. As per reports, trading in shares of Silicon Valley Bank's peer Signature Bank, First Republic Bank, PacWest Bank and several others was halted.

"The US stock was bouncing between gains and losses on Monday, as the yield on the two-year Treasury note plunged in its biggest one-day slump in decades, while tech stocks rebounded from last week’s rout as the collapse of Silicon Valley Bank reverberated across trading desks. The market turmoil has caused a swift reassessment over the direction of Fed policy. Swaps traders are now pricing a less than 60% chance the Fed will hike by another quarter percentage-point later this month," said Marc Despallieres, Chief Strategy and Trading Officer at Vantage.

US dollar to INR

After plunging from three month highs, US dollar rate witnessed some relief rally today as Dollar Index added 0.21 per cent to 103.433 levels.

Speaking on US dollar vs INR (Indian National Rupee), Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas said, "We expect Rupee to trade with a negative bias on risk aversion in global markets amid and fresh FII outflows. However, weak Dollar and declining US Treasury yields may prevent sharp fall in Rupee. Traders may remain cautious ahead of inflation data from India and US. We may see some recovery if the banking crisis in the US is contained. USDINR spot price is expected to trade in a range of ₹81.50 to ₹82.80."

SGX Nifty today

In early morning session, SGX Nifty is trading flat. After opening at 17,208 levels, SGX Nifty today witnessed profit booking and hit intraday low of 17,095 levels. However, it soon witnessed buying interest and recovered from its losses due to the early morning profit booking.

"SGX Nifty today opened flat that signals cautious opening on Dalal Street when the market opens on Tuesday. The index has strong support at 17,000 levels and any rise is expected to trigger selling pressure throughout the day," said Anuj Gupta, Vice President — Research at IIFL Securities.

Asian markets today

In early morning session, the Japanese Nikkei crashed to the tune of 2 per cent, Hong Kong's Hang Seng went down 0.82 per cent whereas South Korean KOSPI nosedived 1.90 per cent.

US bond yield

In early morning session, US 10-year bond yield is up 1.33 per cent to 3.562 while US 30-year bond yield is up 0.84 per cent to 3.698 levels.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.