Nifty Realty biggest loser of the day, down 0.73 percent
V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
With the monetary policy coming on expected lines without any significant market impact, the focus now will be on the US inflation data and its implications for interest rates and equity markets. The fact that the trading volume in US markets is very low indicates that the market is waiting for direction. Big market moves are likely after the data is out. In India, the near-term texture of the market is ‘sell on rallies’. FPI’s sustained selling has become almost predictable. Only a declining inflation rate in the US and the possibility of the Fed turning less hawkish than now can change the trend of FPI selling. FPI selling in banking stocks has led to depressed valuations in this segment, particularly in high quality banking majors. This is an opportunity for medium- long- term investors.
Markets at Opening
Indices lose close to 0.5 percent at opening with Sensex down 225.8 points or 0.41 percent at 54,666.6 and Nifty is trading down by 71.1 points or 0.43 percent at 16,285.15. All sectors in red except pharma which is up 0.25 percent
Vedanta pledges 5.8% stake in Hindustan Zinc for term loan pic.twitter.com/TtEtOrfnxL— CNBC-TV18 (@CNBCTV18Live) June 8, 2022
Prashanth Tapse, Vice President (Research), Mehta Equities Ltd
Early weakness in SGX Nifty is indicating a rough session for stocks at Dalal Street in today’s trade. The negativity can be attributed to overnight precarious session witnessed on Wall Street, as investors weighed updates from major companies and signs that economic growth may be slowing. Although the overhang of credit policy announcement is now over, other negative catalysts like World Bank slashing 2022 global growth forecast to 2.9%, WTI Oil rising to near 14-year high, World Bank cutting India GDP forecast to 7.5%, and the yield on the 10-year US Treasury note flirting around the 3% level will continue to keep markets on the edge.
Pre-market comment by Mohit Nigam, Head – PMS, Hem Securities
Benchmark Indices are expected to open on negative note as suggested by trends on SGX Nifty. US stock markets ended lower on Wednesday lead by rise in treasury yield above the psychologically important 3 percent level and oil prices jumped, fanning worries about inflation and the outlook for interest rates. Dow Jones was down by 269 points, whereas NASDAQ was down by 0.76% to 12615.0 levels. Asian markets are trading on mix note as investors are reacting to the cues from US markets. Nikkei is trading 0.09% higher whereas Topix index is down by 0.06%. Oil prices jumped over 2% to a 13-week high on Wednesday as U.S. demand for gasoline keeps rising despite record pump prices, while expectations that China’s oil demand will increase faced growing supply concerns in several countries, including Iran. The Reserve Bank of India’s (RBI) decision on June 8 to increase repo rate by 50 basis points (bps) to 4.90 percent will lead to a 20-25 bps rise in interest rates of banks’ loans and deposits. On the technical front 16,200 and 16500 are immediate support and resistance in Nifty 50. For Bank Nifty 34700 and 35300 are immediate support and resistance respectively.
#CNBCTV18Market | Here’s how the global market cues are placed this morning pic.twitter.com/bsZKZad76P— CNBC-TV18 (@CNBCTV18Live) June 9, 2022
Goldman Sachs On RBI Policy
Goldman Sachs raised its average inflation forecast to 7.1 percent for CY22 and to 7.2 percent for FY23. It said that the food inflation in May/June 2022 was higher than it previously expected. It expects RBI to effect a further rate hike of 50 bps in August 2022, a hike of 35 bps in September and a hike of 25 bps in December 2022. It had earlier forecasted a further cumulative hike of 75 bps earlier in 2022 which has now been raised to 110 bps. An additional 75 bps hike is seen in repo rate in 2023. Its forecast for rate hikes in this cycle now stands at 275 bps from 265 bps forecasted earlier.
Gold prices inched lower on Thursday
Gold prices inched lower on Thursday, with prices restrained by rising Treasury yields ahead of key U.S. jobs and inflation data this week. Spot gold was down 0.1% at $1,852.21 per ounce, as of 0052 GMT, while U.S. gold futures also eased 0.1% to $1,853.90. Spot silver was flat at $22.04 per ounce, while platinum fell 0.2% to $1,003.64, and palladium rose 0.4% to $1,950.12.
TCS to hold its AGM today
TCS will hold its 27th Annual General Meeting (AGM) today (June 9). The meeting is scheduled to start at 3.30 pm after market hours. The shareholders are expected to approve the payment of final dividend of Rs 22 a share of Re 1 each for the financial year ended March 31, 2022. The company had announced the final dividend during the meeting of its Board on April 11, 2022.
Crude prices rise to 13 week high, trading at $123.7 per barrel
Oil prices held near 13-week highs on Thursday, underpinned by robust demand in the world’s top consumer United States while demand is expected to rebound in China as COVID-19 curbs across major cities are relaxed.
Brent crude futures for August nudged up 12 cents to $123.70 a barrel by 0033 GMT, while U.S. West Texas Intermediate crude for July was at $122.17 a barrel, up 6 cents.
Both benchmarks closed Wednesday at their highest since March 8, matching levels seen in 2008.
Closing Bell: Indices extend losses, Sensex ends 0.39 percent lower at 54,892.49, Nifty at 16,356.25