Here’s breaking down the pre-market action:
STATE OF THE MARKETS
SGX Nifty signals gap-up start
Nifty futures on the Singapore Exchange traded 115 points, or 0.82 per cent, higher at 14,194.50 in signs that Dalal Street was headed for a positive start on Thursday.
Tech View: Analysts see weakness ahead
The Nifty bulls on Tuesday struggled at 14,500 level, even as they defended the crucial support of 14,200 well. The face saving-act, however, did not impress analysts, who believe the index could soon breach the 14,200 level and trigger more weakness.
Asian markets rise in early trade
Asian markets were training mostly higher in Thursday’s trade. Japan’s Nikkei surged 1.83 per cent at 29,041, Hong Kong’s Hang Seng advanced 0.32 per cent; Korea’s Kospi was up 0.58 per cent while China’s Shanghai Composite index was flat.
Wall Street rebounds after two-day decline
Wall Street rebounded on Wednesday after a two-day decline in a broad rally as a tilt toward stocks poised to benefit from a recovering economy offset Netflix Inc’s sell-off after its disappointing results a day earlier. The Nasdaq Composite added 1.19 per cent to 13,950.22. The Dow Jones Industrial Average rose 0.93 per cent to 34,137.31, while the S&P500 index gained 0.93 per cent at 4,173.42.
Q4 earnings today
Tata Elxsi, Cyient, Rallis India, Indus Towers, Sasken Technologies and Fineotex Chemical are among the companies scheduled to announce March quarter earnings today.
Nestle numbers get mixed views
Brokerages have a mixed view on Nestle India even as the company reported a 14.6% growth in net profit for the March quarter from the year-ago level, beating estimates. Nomura, Edelweiss and HSBC have retained ‘buy’ but Investec, Emkay Global and IDBI Capital have retained ‘hold’. CLSA has retained ‘outperform’ and Ambit has retained a ‘sell’ rating on the stock. The maker of Maggi noodles and KitKat chocolate reported a profit after tax of Rs 602 crore for the quarter. Revenues in the quarter rose 8.9% from year ago level to Rs 3,600 crore.
DIIs buy Rs 1,323 crore worth stocks
Net-net, foreign portfolio investors (FPIs) were sellers of domestic stocks to the tune of Rs 1082.33 crore on Tuesday, data available with NSE suggested. DIIs were net buyers to the tune of Rs 1,323.01 crore, data suggests.
Rupee: The rupee pared its initial gains to close marginally down by 1 paisa at 74.88 against the US dollar due to worries that the alarming surge in Covid-19 cases could derail the economic recovery in the country. An increase in crude
prices and losses in the domestic equity markets also weighed on the local unit.
10-year bonds: India 10-year bond yield fell 0.12 per cent to 6.07 after trading in 6.07-6.10 range.
Call rates: The overnight call money rate weighted average stood at 3.23 per cent, according to RBI data. It moved in a range of 1.90-3.50 per cent.
DATA/EVENTS TO WATCH
- Euro Area Govt Budget to GDP 2020 (02:30 pm)
- Euro Area Govt Debt to GDP 2020 (02:30 pm)
- UK CBI Industrial Trends Orders April (03:30 pm)
- UK CBI Business Optimism Index Q2 (03:30 pm)
- Euro Area Deposit Facility Rate (05:15 pm)
- ECB Interest Rate Decision (05:15 pm)
- Euro Area Marginal Lending Rate (05:15 pm)
- US Jobless Claims 4-week Average April 17 (06:00 pm)
- US Initial Jobless Claims 17/April (06:00 pm)
- US Existing Home Sales MoM March (07:30 pm)
Govt may fast-forward bank recap… The government may frontload its bank recapitalisation plan this year to strengthen weaker lenders and further support its privatisation strategy. “While most lenders are adequately capitalised, we may take a call after the first quarter results to see if some growth capital can be provided to further strengthen the banks,” said an official aware of the deliberations. The government allocated Rs 20,000 crore towards bank recapitalisation in FY22 and such capital is traditionally infused at the end of the financial year
share deal raises eyebrows… Proxy advisory firm InGovern Research Services said NBI Industrial Finance, a listed entity controlled by BG Bangur and family, sold shares of some unlisted companies which owned Shree Cement shares worth more than Rs 3,000 crore to other privately-owned promoter group firms for Rs 89 crore in FY17. BG Bangur and family own Shree Cements, the second-largest cement producer in terms of market value. The company neither took shareholders’ permission for the transactions, which came to light recently nor published the valuation report, said InGovern in a letter to market regulator Sebi.
Kamath panel clears Future debt rejig… The KV Kamath Committee set up by the Reserve Bank of India has approved lenders’ proposal to restructure their loans to Future Retail and Future Enterprises, the main units of the Kishore Biyani-led retail group, two people familiar with the process said. Banks now aim to complete the restructuring process before the end of the week. This is the second large loan restructuring approved by the five-member Kamath committee after Rs 10,900 crore restructuring that it had okayed for the Shapoorji Pallonji Group.
India Inc starts vaccinating staff… Leading corporate brands have started to tap private healthcare providers to conduct on-site and off-campus Covid vaccination drives for their entire workforce, with costs to be borne by them. The move comes with a little over a week left before inoculation coverage of all adults against Covid begins in the country. Inoculation against the disease is key to India safely reopening large parts of its economy, production facilities and office complexes. Though not mandatory, companies are hopeful that all their employees will take the vaccines as India allows people of 18 and above to get immunised against coronavirus from May 1.
Localised lockdowns to hurt GDP growth… Countrywide localised lockdowns due to a spike in Covid-19 cases are likely to hit India’s GDP growth particularly in the quarter ended June, delaying the fragile economic recovery and likely pulling down economic growth for the fiscal year, economists said. HSBC expects India’s year-on-year GDP growth to fall back into negative territory after recording a marginal 0.4% increase in the quarter ended December 2020. Moreover, quarter-on-quarter GDP in the three months ended June 2021could again contract.
Banks may restrict footfalls to contain virus… Banks are set to take measures to restrict footfalls to contain the spread of infections in areas with a surge in Covid cases. The Indian Banks’ Association held a meeting of bank chiefs on Wednesday to take stock of the Covid situation. It was decided that state-level bankers’ committees (SLBCs) will take a call on the services branches will provide. The SLBC will also provide the standard operating procedure (SOP) for branches.
Air travel demand drops sharply… As the second wave of Covid-19 grips the nation, demand for air travel demand has taken a sharp hit. Stricter norms and sporadic lockdowns by some states have led to people cancelling plans. As a result, airlines are slashing flights and grounding planes. Senior executives said there will be more drastic cancellations in the coming weeks, more fleets will be grounded and employees will again be sent on leaves without pay or laid off. In the past few days, most airlines have cancelled 20%-35% of their flights and are now flying 45%-60% of their pre-Covid capacity.
Auditors struggle to meet compliance… Auditors are struggling to meet year-end compliance deadlines for listed companies due to the mobility curbs imposed by several states to prevent a further surge in the second wave of coronavirus infections. Sebi rules require a company to file its annual report within 60 days from the end of the financial year. The annual reports must contain all the necessary audit reports. Auditors must undertake several checks, including a physical examination of factories and machinery, and also provide their opinion on issues such as impairment of assets.
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