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Markets likely to be volatile; Vodafone, Axis Bank, Tata Motors, L&T in focus

On Friday, the BSE Sensex ended at 52,975.80, up 138.59 points or 0.26%. The Nifty closed at 15,856.05, up 32 points or 0.20%. (REUTERS)Premium
On Friday, the BSE Sensex ended at 52,975.80, up 138.59 points or 0.26%. The Nifty closed at 15,856.05, up 32 points or 0.20%. (REUTERS)

  • Kotak Mahindra Bank, Larsen & Toubro, Axis Bank, Tata Motors, SBI Life Insurance, Vedanta, DLF, GlaxoSmithKline Pharmaceuticals, Coromandel International, Navin Fluorin, M&M Financial Services and Alembic Pharmaceuticals will declare June quarter earnings.

MUMBAI: Markets are likely to be volatile on Monday while trends in SGX Nifty suggest a weak opening. On Friday, the BSE Sensex ended at 52,975.80, up 138.59 points or 0.26%. The Nifty closed at 15,856.05, up 32 points or 0.20%.

Asian shares struggled to rally on Monday as super-strong US corporate earnings sucked funds out of emerging markets and into Wall Street, where records were falling almost daily.

As funds flock to Wall Street, Asian markets have been largely snubbed. MSCI's broadest index of Asia-Pacific shares outside Japan has been trending sideways since March and was up just a fraction on Monday.

Japan's Nikkei bounced 1.6% in early trade, but that was off a seven-month low. South Korea has fared somewhat better thanks to demand for tech stocks but was little changed on Monday.

The week is also packed with US data that should underline the economy's outperformance. Second-quarter gross domestic product is forecast to show annualised growth of 8.6%, while the Fed's favoured measure of core inflation is seen rising an annual 3.7% in June.

The Federal Reserve meets on Wednesday and, while no change in policy is expected, Chair Jerome Powell will likely be pressed to clarify what "substantial further progress" on employment would look like.

Kotak Mahindra Bank, Larsen & Toubro, Axis Bank, Tata Motors, SBI Life Insurance, Vedanta, DLF, GlaxoSmithKline Pharmaceuticals, Coromandel International, Navin Fluorin, M&M Financial Services and Alembic Pharmaceuticals will declare June quarter earnings.

Reliance Industries Ltd (RIL) on Friday said fiscal first-quarter profit fell 7.25% as the second wave of covid-19 impacted businesses. Profit fell to 12,273 crore for the quarter to June from 13,233 crore a year ago. Revenue from operations rose 58% to 1.44 trillion from 91,238 crore a year ago.

Vodafone Group Plc and Aditya Birla Group may cede control of Vodafone Idea Ltd (VIL) if a strategic investor wants to take control of the telco, according to a Mint report.

So far, the bond market has been remarkably untroubled by the prospect of eventual tapering with yields on US 10-year notes having fallen for four weeks in a row to stand at 1.28%.

The drop has done little to undermine the dollar, in part because European yields have fallen even further amid expectations of continued massive bond buying from the European Central Bank.

The single currency has been trending lower since June and touched a four-month trough of $1.1750 last week. It was last at $1.1770 and looked at risk of testing its 2021 low of $1.1702.

The dollar has also been edging up on the yen to reach 110.57, but remains short of its recent peak at 111.62. The fall in the euro has lifted the dollar index to 92.891, a long way from its May trough of 89.533.

The rise in the dollar has offset the drop in bond yields to leave gold range-bound around $1,800 an ounce.

Oil prices have fared better amid wagers demand will remain strong as the global economy gradually opens and supply stays tight.

Brent was trading 23 cents firmer at $74.33 a barrel, while U.S. crude added 20 cents to $72.27.

(Reuters contributed to the story)

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