Indian indices witnessed negative start on Tuesday amid mixed global trends. Globally, US markets closed slightly higher in overnight session led by gains in Amazon and other mega-cap growth shares, while persistent worries over inflation and interest rates kept a lid on the market. Oil prices inched higher on Tuesday on expected demand recovery in China as it relaxed tough Covid curbs and doubts a higher output target by OPEC+ producers would ease tight supply. In Asia, shares rose in Japan, while it wavered in South Korea, Hong Kong, Australia, and Shanghai.
Dollar hits 2-decade high vs yen, pound near 3-week low
The U.S. dollar rose to a two-week high as rising U.S. Treasury yields supported the greenback, pushing the Japanese yen to its lowest level against the dollar in two decades.
The yen dropped to a 20-year low of 133 per dollar, levels that had previously been highlighted as intervention territory, a day after central bank governor Haruhiko Kuroda reiterated an unwavering commitment to “powerful” monetary stimulus.
The yen is sensitive to interest rate differentials between Japanese debt and U.S. bonds.
Benchmark 10-year Treasury yields had climbed as high as 3.064% in Tokyo trading for the first time in almost four weeks, before slipping back to 3.0307%. Spreads between 10-year U.S. and Japanese debt held at 278 bps, not far from a 3-1/2 year high of 292 bps hit last month.
Stocks drop with US futures in risk-off mood
European stocks fell with U.S. futures Tuesday as investors dumped risk assets as central banks resolute on tightening policy fanned growth fears. The dollar advanced and bond yields stabilized.
The Stoxx Europe 600 Index slipped as telecom and technology stocks weighed. In the UK, the export-heavy FTSE 100 was little changed as the pound slid on concerns about the nation’s growth and risks to Boris Johnson’s leadership.
Investors are reluctant to take on risk and volatility remains elevated. Equities are struggling to mount a sustainable rebound amid fears policy makers need to be even more aggressive in their withdrawal of stimulus to rein in inflation, hurting the economy and corporate earnings.
FMCG stocks slip 1.6%; Major firms such as HUL, Britannia, Marico, Nestle, Tata Consumer, Dabur, Godrej Consumer all in the red
Retail investors have come in a big way: FM Sitharaman on stock market volatility
Finance Minister Nirmala Sitharaman on Tuesday said retail investors seem to act as shock absorbers even when foreign portfolio investors continued to pull away amid volatility in stock market as there has been a very significant increase in retail investor numbers during the pandemic.
Zerodha introduces iceberg orders for investors to reduce impact costs. How it works
Traders lose more to impact costs than to brokerage and taxes when trading large quantities, therefore online brokerage firm Zerodha has introduced Iceberg orders which aims to help reduce impact costs.
Oil & Gas stocks rise 1.3%; ONGC, GAIL top gainers, Gujarat Gas top loser
Sensex at 01:20 pm: Trades 600 points lower as investors turn cautious ahead of RBI’s interest rate decision
Why gold prices could rise sharply this year
Gold could be heading for another rally, with warnings over a global economic slowdown paving the way for a fresh push toward $2,000 an ounce. A potent mix of decades-high inflation, geopolitical turmoil and growing talk of recession should be bullish for the traditional haven, according to speakers interviewed ahead of a precious metals conference in Singapore this week.
Pakistan commits to stream gas pipeline project with Russia
Pakistan’s ambassador to Russia Shafqat Ali Khan said his country is committed to the Pakistan Stream gas pipeline project with Moscow, adding that legal discussions are underway between the two countries.
This comes amid the declining Russian energy exports amid the Ukraine conflict. The European Union last week banned the import of Russian oil into the EU, thereby cutting a massive source of revenue for Russia.
Insurance stock trades ex-dividend, shares fall
While announcing its earnings for the quarter ending March 2022, the General Insurance Corporation of India (GIC) said that its board has approved declaration of interim dividend Rs. 2.25 per equity share (subject to deduction of TDS) on the face value of ₹5 each (i.e. 45% of paid-up equity share capital), for the financial year 2021-22.
Policybazaar tanks as CEO Yashish Dahiya mulls share sale
Policybazaar share price today crashed over 13 per cent after the company informed about its Chairman & CEO Yashish Dahiya’s plans to offload over 37.69 lakh shares. Policybazaar shares opened with downside gap and went on to hit intraday low of ₹568.60 on NSE, around 13 per cent lower from its yesterday’s close of ₹658.75 per share on NSE.
Tamilnad Mercantile Bank IPO gets Sebi’s nod
Private sector lender Tamilnad Mercantile Bank has received capital markets regulator Securities and Exchange Board of India’s (SEBI) to launch and raise funds through an initial public offering (IPO).
Top BSE losers: Titan, LIC Housing Finance, Greaves Cotton slip
Asian markets mixed after Wall St bond sell-off
Asian stock markets were mixed Tuesday after a bond sell-off on Wall Street fueled anxiety about a possible U.S. economic slowdown and Australia raised interest rates.
Shanghai and Tokyo advanced while Hong Kong and Seoul declined. The yen, trading at two-decade lows, fell further to below 132 to the dollar.
Wall Street’s benchmark S&P 500 index rose 0.3% on Monday and the market price of a 10-year Treasury bond fell. That increased its yield, or the difference between the day’s price and the payout at maturity.
In this multibagger penny stock, Nomura, Forbes EMF buy stakes
Multibagger stock: Foreign portfolio institutions (FPIs) — Nomura Singapore Limited, Forbes EMF and AG Dynamic Funds Limited have bought stake in multibagger penny stock Vikas Lifecare. Out of of 12,50,00,000 equity shares offered by the company in its ₹50 crore fund raise drive, the board of directors of the company approved allotment of 5,40,00,000 shares to Forbes EMF, 4,40,00,000 shares to Nomura Singapore Ltd and 2,70,00,000 shares to AG Dynamic Funds Limited.
Bond yields signals aggressive RBI rate hikes. What it means for your investment
India’s benchmark 10-year bond yield rose to its highest levels in three years ahead of RBI policy announcement due tomorrow. India’s benchmark 10-year bond yield rose to 7.53%, up 4 basis points from its previous close, the highest since March 2019. Bond yields are inversely related to yields. After raising its key lending rate or the repo rate by 40 basis points last month, the RBI is widely expected to sharply hike the rate again tomorrow.
HDFC Bank hikes lending rates across loan tenors, EMIs to go up
India’s largest private sector lender HDFC Bank has hiked its marginal-cost based lending rate (MCLR) on loans for all tenors by 35 basis points (bps). The hike comes amid widely expectations of sharp rate hike by the Reserve Bank of India (RBI) tomorrow.
Top BSE gainers: Chennai Petroleum, MRPL, Time Technoplast lead
Gold prices in check as central banks rev up policy tightening
Gold prices held near one-week lows on Tuesday as investors wagered that aggressive tightening plans by major central banks would keep interest rates elevated for an extended period, boosting U.S. Treasury yields and in turn the dollar.
Spot gold was little changed at $1,842.46 per ounce, as of 0442 GMT, trading in a tight $5 range.
Earlier in the session, bullion touched $1,836.10, its lowest since June 1. U.S. gold futures were steady at $1,844.90.
Paytm shares: JPMorgan remains overweight, sees over 60% upside
Analysts at JPMorgan believe a sustained improvement in the profit margin contribution (Q4F22 35%) at Paytm seen over the last 2Qs sets the stage for operating leverage Q2F23 onwards as indirect costs moderate – resulting in a consistent downtrend in Adjusted EBITDA loss and an eventual path to breakeven.
This small finance bank to soon turn ex-bonus stock. Details here
Board of director of AU Small Finance Bank has fixed record date for finalising eligible shareholders for issuance of bonus share of 1:1. The small finance bank informed Indian bourses that record date for bonus share issuance is 10th June 2022.
Multibagger stock: Aarti Industries share hits 52-week low. Right time to buy?
Multibagger stock: After giving strong rebound in post-Covid rally, Aarti Industries share price has been under consolidation after scaling to its life-time high in October 2021. On Monday, this multibagger stock hit its 52-week low of ₹708.40 on NSE. According to stock market experts, sell-off in Aarti Industries shares is due to the weak global sentiments as the chemical company has reported 45 per cent year-on-year (YoY) rise in revenue and 42 per cent YoY rise in PAT (Profit After Tax).
Cryptocurrency prices today: Bitcoin, ether, dogecoin, Shiba Inu fall up to 7%
In cryptocurrencies, Bitcoin price today fell below $30,000 after advanced back above the $31,000 mark in the previous session. The world’s largest and most popular cryptocurrency plunged more than 4% and was trading at $29,370.
SBI Card to raise ₹2,500 cr via NCDs
SBI Cards and Payment Services (SBI Card) on Monday said its board has approved a proposal to raise ₹2,500 crore by issuing non-convertible debentures (NCDs) to fund business growth.
The fund would be raised in one or more tranches, SBI Card said in a regulatory filing.
The NCD issuance would be done on a private placement basis, it added.
Rakesh Jhunjhunwala portfolio: Tata group stock at 52-week low. Should you buy?
Rakesh Jhunjhunwala portfolio: In recent sell-off, a good number of quality shares in the Indian stock market have undergone heavy correction. Tata Communications shares are one of them. This Rakesh Jhunjhunwala stock is close to its 52-week low that can be an attraction for the positional investors who are looking for a quality shopping at reasonable price. According to stock market experts, Tata Communications share price looks positive for long term positional investors as its order book has improved and the company has recently expressed confidence in its revenue growth recovery.
Copper eases on firmer dollar; China demand hopes offer support
Copper prices slipped on Tuesday, weighed down by a stronger dollar, although demand revival hopes as top consumer China relaxed COVID-19 curbs, and declining inventories limited losses.
Three-month copper on the London Metal Exchange was down 0.6% at $9,682.50 a tonne, as of 0344 GMT. The most-traded July copper contract in Shanghai was down 0.1% at 72,690 yuan ($10,909.50) a tonne by the midday break.
Rupee slips 5 paise to 77.71 against US dollar in early trade
The rupee depreciated 5 paise to 77.71 against the US dollar in opening trade on Tuesday, as heavy selling pressure in domestic equities and a strong greenback in the overseas market weighed on investor sentiments.
In addition, investors remained concerned over rising crude prices and sustained foreign capital outflows, forex dealers said.
At the interbank foreign exchange, the rupee opened weak at 77.72 against the US dollar, then recovered slightly to quote 77.71, registering a decline of 5 paise from the last close.
In the previous session, the rupee had closed at 77.66 against the US dollar.
On the domestic equity market front, the 30-share Sensex was trading 532.74 points or 0.96 per cent lower at 55,142.58, while the broader NSE Nifty declined 157.50 points or 0.95 per cent to 16,412.05.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.15 per cent to 102.59.
Global oil benchmark Brent crude futures advanced 0.73 per cent to USD 120.38 per barrel.
Foreign institutional investors were net sellers in the capital market on Monday as they offloaded shares worth ₹2,397.65 crore, as per exchange data.
Weak early start for BSE indices; Sensex drops over 450 points
Nifty50 opens below 16,450; ONGC, Coal India top gainers, Titan, HUL, Asian Paints top losers
Sensex opens over 450 points lower amid weak Asian cues; Titan drops 4%, Asian Paints 2.3%
Pre-open: Nifty50 slips below 16,500; ONGC rises 0.55%, Bajaj Auto, HUL, Maruti, TechM top losers
Pre-open: Sensex tumbles over 300 points amid mixed global cues; All the 30 stocks flat or negative
Japan’s Nikkei hits over 2-month high on automakers boost
Japan’s Nikkei index touched a more than two-month high on Tuesday, as automakers led gains after the U.S. dollar hit fresh 20-year highs.
The Nikkei share average was up 0.4% at 28,024.40 by 0217 GMT, rising above the 28,000 level for the first time since March 31. The broader Topix rose 0.72% to 1,952.96.
“Automakers pushed the Nikkei above the 28,000-mark but it seems only limited amount of money is circulating around the market these days,” said Shoichi Arisawa, general manager of the investment research department at IwaiCosmo Securities.
“The market has been struggling to rise in a broad rally and investors are targeting different sectors each day.”
Gold’s haven appeal burnished by drumbeat of growth warnings
Gold could be heading for another rally, with warnings over a global economic slowdown paving the way for a fresh push toward $2,000 an ounce.
A potent mix of decades-high inflation, geopolitical turmoil and growing talk of recession should be bullish for the traditional haven, according to speakers interviewed ahead of a precious metals conference in Singapore this week.
Bullion is down about 10% from a peak in mid-March, after the concerns that Russia’s invasion of Ukraine might sprawl into a broader conflict dissipated. But with top banking executives now warning about fresh economic shocks, the situation is ripe for stagflation, which would be bullish for gold.
India’s rate hike is just a matter of how much
As India’s monetary policy makers huddle to find ways to tame inflation, the question for them is not whether to raise borrowing costs, but by how much.
The six-member Monetary Policy Committee will probably raise the benchmark interest rate by 40 basis points to 4.8% on Wednesday, according to the median in a Bloomberg survey of 37 economists. As of Monday, the poll returned what is easily the most varied number of predictions for hikes, ranging from 25 basis points to 75 basis points.
With Wednesday’s policy decision following May’s surprise 40 basis-point off-cycle hike, expectations have narrowed down to the size of increase to tame inflation that’s been running above the central bank’s 2%-6% target band since the beginning of this year. Wholesale prices have gained at the fastest pace in over three decades, adding pressure on businesses to pass on high costs to consumers.
Day trading guide for Tuesday
7 stocks to buy or sell today — 7th June
Asian wealth managers seen wary of digital assets despite soaring demand
Wealth managers in Asia are holding back from offering digital assets to investors despite soaring demand due to a lack of understanding of these assets, according to an industry survey by consulting firm Accenture published on Monday.
Global banks have been cautiously moving into crypto for several years, some building it within existing operations and others setting up new businesses.
“Currently, 52 percent of affluent investors in Asia hold digital assets of some sort. Accenture’s research indicates this could reach 73 percent by the end of 2022,” Accenture said on Monday.