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Benchmark indices BSE Sensex and NSE’s Nifty 50 closed in the red on Thursday. Photo: Reuters
Benchmark indices BSE Sensex and NSE’s Nifty 50 closed in the red on Thursday. Photo: Reuters

Markets likely to be wobbly; Reliance, Tata Steel in focus

  • Stocks in Asia fell on Friday tracking sell-offs in the United States and Europe as investors feared the economic impact of an accelerating rise in coronavirus infections

MUMBAI: Markets are likely to be wobbly on Friday, while trends in SGX Nifty suggest a weak opening for Indian benchmark indices. On Thursday, the BSE Sensex ended at 43,357.19, down 236.48 points or 0.54%. The Nifty ended at 12,690.80, down 58.35 points or 0.46%.

Stocks in Asia fell on Friday, tracking sell-offs in the United States and Europe as investors feared the economic impact of an accelerating rise in coronavirus infections.

The United States has reported fresh daily records for new covid-19 case hospitalisations this week, prompting cities and states, including Chicago, Detroit and California, to re-impose public health restrictions.

European officials have also warned against complacency and said measures to control infections must continue despite hopes that vaccines under development could help to slow the spread of the novel coronavirus.

US Federal Reserve Chair Jerome Powell said on Thursday during a discussion with other central bankers that progress in developing a coronavirus vaccine was welcome news but that near-term economic risks remain as infections accelerate, underscoring the likely need for additional government stimulus.

Against that grim backdrop, MSCI's broadest index of Asian shares outside Japan dipped 0.25% in early trade as shares across the region stumbled.

Reliance Industries Ltd shares will be in focus as the company will invest up to $50 million in Breakthrough Energy Ventures IILP, the company said in a regulatory filing today. Investment will be made in tranches over 8-10 years with the $50 million constituting 5.75% of the size of the fund contemplated at present.

Top companies that will announce September quarter results today are Tata Steel, Future Retail, ONGC and Shoppers Stop among others.

Meanwhile, six suitors have submitted their expressions of interest (EoIs) to acquire troubled Dewan Housing Finance Ltd’s (DHFL’s) stake in Pramerica Life Insurance Co. Ltd (formerly DHFL Pramerica Life Insurance), according to a Mint report.

In other news,Consumer Price Index (CPI)-based inflation shot up to a worrying 7.61% in October, well above the central bank’s comfort zone, fuelled by a spike in food prices, official data showed on Thursday.

US Treasury yields also sank on Thursday, weighed down by the persistent rise in coronavirus cases and data showing inflation remained benign in the world's largest economy. The US yield curve, viewed in part as a gauge of risk appetite, also flattened.

On Friday, US yields continued to tick lower, with benchmark 10-year Treasury notes yielding 0.8766%, compared to a Thursday close of 0.886%.

Rising risk aversion lifted the safe-haven yen, with the dollar dropping 0.18% against the Japanese currency to 104.93 . The euro was flat in Asian morning trade and the dollar index ticked 0.2% higher to 92.987.

An unexpected rise in US crude stockpiles exacerbated virus-linked economic fears in commodity markets, pushing US crude 1.63% lower to $40.45 per barrel.

Global benchmark Brent crude dropped 1.45% to $42.90 per barrel. Spot gold gained 0.17% to $1,878.97 per ounce.

(Reuters contributed to the story)

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