Stock Market Today: Top 10 things to know before the market opens on 16August
The benchmark Sensex and Nifty indices are expected to open marginally lower on August 16 as trends in the GIFT Nifty indicate a negative start for the broader index with a loss of 101 points.
The BSE Sensex gained 79.27 points to close the previous session at 65,401 points, while the Nifty50 closed 6.25 points higher at 19,434 points, trading near its 200-day moving average of 19,602 points and trying to sustain the ongoing momentum.
The pivot point calculator indicates that the Nifty may get support at 19,307 followed by 19,258 and 19,178. In case of an upside, 19,466 can be the key resistance, then 19,515 and 19,594.
Stay tuned to Moneycontrol to find out what happens in the currency and equity markets today.
We have collated a list of important headlines across news platforms, which could impact Indian as well as international markets.
GIFT Nifty
The GIFT Nifty indicates a marginally negative start for the broader index with a loss of 101 points after the Nifty closed 6 points higher at 19,434 points on August 14.
GIFT Nifty futures stood at 19,369 points.
US Markets
Stock futures are near flat Tuesday night as investors came off a losing session that marked the latest leg down in an August slump. Futures tied to the Dow Jones Industrial Average added 2 points, trading near the flatline.
S&P 500 and Nasdaq 100 futures were also both little changed.
Tax preparer H&R Block and Mediterranean food chain Cava advanced more than 6 percent and 9 percent, respectively, after the bell on the back of stronger-than-expected quarterly reports.
The moves follow a losing session on Wall Street, with all three of the major indexes finishing more than 1% lower on Tuesday.
With the losses, the Dow snapped a three-day winning streak. Meanwhile, the S&P 500 ended the session below its 50-day moving average, which could signal a downturn ahead.
Financial stocks including JPMorgan, Wells Fargo and Bank of America slid after Fitch warned it may be forced to downgrade the credit ratings of dozens of banks.
It comes as the latest challenges to the sector, following Moody’s decision last week to downgrade the ratings of 10 banks while putting other institutions on a watchlist.
European Markets
European markets fell Tuesday as investors weighed wage growth figures from the UK and disappointing data from China.
The pan-European Stoxx 600 index closed 0.9 percent lower, with most sectors in negative territory. Basic resources slid 1.5 percent as banks and utilities both fell 1.2 percent.
Retail stocks were 0.5 percent higher, boosted by a 7.5 percent rise in shares of British department store chain Marks & Spencer, which raised its profit outlook in results published Tuesday.
FTSE closed 1.57 percent lower at 7,389 points and DAX closed 0.86 percent lower at 15,767 points on Tuesday.
Asian Markets
Asia-Pacific markets fell on Wednesday mirroring moves on Wall Street after a decline in US banks. Shares of JPMorgan Chase and Wells Fargo dropped 2 percent, and Bank of America dropped 3 percent.
The action came after Fitch warned it may have to downgrade credit rating dozens of banks, including JPMorgan Chase.
Last week, Moody’s lowered its rating on 10 U.S. banks while putting other big institutions on a watchlist for potential downgrades. In Asia, Japan’s Nikkei 225 slid 0.82 percent and the Topix was down 0.68 percent, despite business sentiment improving in July, according to the Reuters Tankan survey.
South Korea’s Kospi came back from a public holiday 1.03 percent down, while the Kosdaq saw a larger loss of 1.18 percent.
In Australia, the S&P/ASX 200 slipped 1.20 percent, on pace for its third day of losses in four days.
Futures for Hong Kong’s Hang Seng index stood at 18,360, pointing to a weaker open compared to the HSI’s close of 18,581.11.
China will release its house prices for July, that investors will watch given the country’s recent real estate troubles.
Gangwal family launches mega $450mn block deal in Interglobe Aviation, biggest yet
A mega deal is brewing at Interglobe Aviation as the Gangwal family led by Rakesh Gangwal looks to raise $450 million or around Rs 3,735 crore via a block trade, the biggest yet, in the ongoing stake reduction exercise of the co-founder of Indigo Airlines, multiple industry sources in the know told Moneycontrol.
In September 2022, the family sold a tranche of 2.8 percent worth Rs 2,000 crore and in February, sold a 4 percent stake for Rs 2,900 crore. Rakesh Gangwal stepped down from the board of Interglobe Aviation in February 2022 and the family holds a 29.72 percent stake as per the latest stock exchange disclosures.
When he quit the board, Gangwal said the family would dilute its stake in a phased manner.
Yes, this big trade has been launched. The Gangwal family plans to offload around 4 per cent stake,” said one of the persons above.
The offer floor price is Rs 2,400 per share, representing a 5.8 percent discount to the last close price of Rs 2,549 per share, according to deal terms viewed by Moneycontrol.
Foxconn sees opportunity to invest several billions of dollars in India
Taiwanese electronics manufacturing giant Foxconn sees the potential of investing several billions of dollars in India if it gets to completely implement its plan, a top official of the company said.
Hon Hai Technology Group (Foxconn) Chairman and CEO Young Liu during the company’s second-quarter earnings call on Friday said that the company’s Indian arm has achieved a turnover of close to $10 billion on an annual basis and there is a lot of investment potential in India. “Foxconn annual revenue was $200 billion.
From the perspective of India’s potential market size and if we can fully implement our plans there, several billion dollars in investment is only the beginning.
He said Foxconn operates about nine campuses in India.
“Total size will be equivalent to more than 500 football fields. We have over 30 factories in India.
The turnover and business size are roughly $10 billion annually. We have over 20 dormitories that shelter tens and thousands of employees that work with Foxconn in India,” Liu said.
He said questions around India have been coming up during investors’ calls since the last two quarters, which indicates there is positive energy in the country.
I have said before that our capex this year will grow from last year.
That outlook has not changed,” Liu said.
SBFC Finance IPO grey market premium falls. Will it still debut on a strong note?
When SBFC Finance gets listed today, it is likely to debut with a 35-40 percent premium over its issue price of Rs 57 per share, against the 70 percent premium that was expected earlier.
If the strong initial public offering (IPO) subscription numbers and robust business model with stable asset quality were the factors behind the bullishness till last week, the correction in equity markets is the main reason for this shift, experts said.
In more than three-and-a-half weeks, especially since July 20 when Nifty hit a record high of 19,992, the index has corrected around 3 percent and experts largely expect the consolidation to continue in the market.
The runaway rally since the end of March is unlikely in the coming weeks.
Till last week, SBFC traded consistently with a 70 percent premium in the grey market, but since the start of current week, the premium dropped up to 40-45 percent over the upper price band, analysts said on conditions of anonymity.
The grey market is an unofficial market for trading IPO shares till listing.
India’s imports from Russia doubled to $20.45 billion in April-July period
India’s imports from Russia doubled to $20.45 billion during the April-July period of this fiscal due to increasing inbound shipments of crude oil and fertilizer from that country, according to the commerce ministry data.
With this, Russia has become India’s second-largest import source during the first four months of this fiscal.
The imports were $10.42 billion in April-July 2022.
From a market share of less than 1 percent in India’s import basket before the start of the Russia-Ukraine conflict, Russia’s share of India’s oil imports rose to over 40 percent.
India, the world’s third-largest crude importer after China and the United States, has been buying Russian oil that was available at a discount after some in the West shunned it as a means of punishing Moscow for the invasion of Ukraine.
The ministry’s data showed that imports from China dipped to $32.7 billion during the April-July period as against $34.55 billion in the same period last year.
JPMorgan among US banks facing risk of rating cut as Fitch mulls downgrade
JPMorgan Chase is among the scores of the United States-based lenders that face the risk of a reduction in their assessment scores as Fitch Ratings is mulling over an industry-wide downgrade, CNBC reported on August 15.
The agency had slashed its rating of the US banking industry to AA- in June, but the move largely went unnoticed as it did not warrant an individual downgrade of the American banks.
However, another downgrade will reduce the industry’s rating to A+ from AA-, and this will force Fitch to reevaluate its assessment of each of the US lenders, the agency’s analyst Chris Wolfe was reported as saying.
If we were to move it to A+, then that would recalibrate all our financial measures and would probably translate into negative rating actions,” Wolfe said while speaking to CNBC in New York.
Oil Prices
Oil prices fell over 1 percent on Tuesday on sluggish Chinese economic data coupled with fears that Beijing’s unexpected cut in key policy rates was not sufficiently substantial to rejuvenate the country’s sputtering post-pandemic recovery.
Brent crude futures fell $1.31, or 1.5 percent, to $84.90 a barrel by 10:56am EDT (1456 GMT), while US West Texas Intermediate crude fell $1.44, or 1.8 percent to $81.07.
Supply cuts by Saudi Arabia and Russia, part of the OPEC+ group comprising the Organization of the Petroleum Exporting Countries (OPEC) and allies, have helped to galvanise a rally in prices over the past seven weeks.
However, China’s industrial output and retail sales data on Tuesday showed the economy slowed further last month, intensifying pressure on already faltering growth and prompting authorities to cut key policy rates to bolster economic activity.
Dollar Index
The Dollar index traded 0.04 percent higher in futures at 103.25, whereas the value of one dollar hovered near Rs 83.39.
Gold Prices
Gold prices steadied on Tuesday, buoyed by a retreat in bond yields and dollar, although expectations that the Federal Reserve would likely keep interest rates higher for longer after strong US data kept bullion near the six-week low.
Spot gold was flat at $1,907.60 per ounce by 11:14am EDT (1514 GMT), having hit its lowest level since June 29 at $1,895.50 earlier in the session. US gold futures eased 0.2 percent to $1,940.20.
US retail sales jumped 0.7 percent last month, the Commerce Department said on Tuesday, suggesting the economy continued to expand early in the third quarter. Economists polled by Reuters had forecast retail sales would climb 0.4 percent.
FIIs and DIIs
Foreign institutional investors (FII) sold shares worth Rs 2,324.23 crore, while domestic institutional investors (DII) purchased Rs 1,460.90 crore worth of stocks on August 14, provisional data from the National Stock Exchange (NSE) showed.
