What changed for the market while you were sleeping? Top 12 things to know

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Indian market ended in the red on September 27, tracking weakness in other Asian markets. The 30-share Sensex closed the day with a loss of 167 points, or 0.43 percent, at 38,822.57, with 20 stocks in the red, while the Nifty50 finished 59 points, or 0.51 percent, lower at 11,512.40. Among the 50 stocks in the index, 39 suffered losses.

Experts are of the view that the market may see some consolidation due to sharp gains during the previous week. The Nifty50 has begun the consolidation phase after a massive rally. All short-term indicators have moved to overbought levels which cap the upside for the time being.

According to the pivot charts, key support level for Nifty is placed at 11,476.93, followed by 11,441.47. If the index starts moving up, key resistance levels to watch out for are 11,570.73 and 11,629.07.

Nifty Bank closed with a loss of 0.42 percent at 29,876.65. The important pivot level, which will act as crucial support for the index, is placed at 29,687.77, followed by 29,498.84. On the upside, key resistance levels are placed at 30,089.17 and 30,301.63.

Stay tuned to Moneycontrol to find out what happens in currency and equity markets today. We have collated a list of important headlines from across news: US Markets

US stocks fell on Friday after reports that the Trump administration was considering delisting Chinese companies from US stock exchanges, raising worries about a further escalation in the US-China trade war. The move would be part of a broader effort to limit US investment in Chinese companies, sources told Reuters.

The Dow Jones Industrial Average fell 70.87 points, or 0.26%, to 26,820.25, the S&P 500 lost 15.83 points, or 0.53%, to 2,961.79 and the Nasdaq Composite dropped 91.03 points, or 1.13%, to 7,939.63.

Asian Markets

Asian shares and the Chinese yuan were off to a cautious start on Monday as investors looked to how Chinese financial markets will react to the news the US administration is considering delisting Chinese companies from US stock exchanges.

MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.11% while Japan’s Nikkei shed 0.61%.

SGX Nifty

Trends on SGX Nifty indicate a flat to negative opening for the broader index in India, with a 8.5 points loss or 0.07 percent. Nifty futures were trading around 11,576-level on the Singaporean Exchange.

Oil recovers from two-week low; US-China trade war caps gains

Oil prices edged higher on Monday, rebounding from a two-week low in the previous session, although gains were checked by concerns about the outlook for the global economy.

US West Texas Intermediate crude futures rose 14 cents, or 0.3% to $56.05 a barrel. WTI fell to $54.75 a barrel on Friday, its lowest since Sept. 13, when prices closed down 0.9%. Brent crude futures rose 21 cents, or 0.3%, to $62.12 a barrel, having dipped as low as $60.76 a barrel on Friday when prices fell 1.3%.

Rupee rallies to nearly 2-month high as crude subsides

The rupee spurted by 32 paise to close at a nearly two-month high against the US currency on Friday as crude oil prices receded following reports that Saudi Arabia had agreed on a temporary ceasefire in Yemen. The domestic currency closed higher by 0.44 per cent at 70.56 to the US dollar, a level not seen since August 2 when it had ended at 69.60.

The rupee had opened weak and declined to the day’s low of 70.93 in early trade due to a stronger dollar and losses in stock markets. Easing crude oil prices provided a fillip to the local currency that reversed losses in the mid-session and climbed to an intra-day high of 70.53, before finally ending at 70.56.

China September factory activity shrinks for fifth month: official PMI

China’s factory activity shrank for the fifth straight month in September, and though the downturn eased off slightly the underlying trend pointed to persistent pressure on the economy as it navigates a bruising trade war with the United States.

The official Purchasing Managers’ Index (PMI) was at 49.8 in September, slightly higher than 49.5 in August, data from the National Bureau of Statistics (NBS) showed. The 50-point mark separates expansion from contraction on a monthly basis.

Analysts polled by Reuters had expected the September PMI to stay unchanged from August’s reading.

Govt may seek Rs 30,000 crore interim dividend from RBI

The government may seek an interim dividend of about Rs 30,000 crore from the RBI towards the end of the financial year to meet its fiscal deficit target of 3.3 percent of GDP for 2019-20, sources said. Government finances have come under pressure due to moderation in revenue collection and a slew of measures taken to lift growth from a six-year low of 5 percent in the first quarter of the current fiscal.

“If required, the government may request the Reserve Bank of India for interim dividend of Rs 25,000-30,000 crore during the current fiscal,” an official said.

Saudi Arabia to invest $100 billion in India

Saudi Arabia, the world’s biggest oil exporter, is looking at investing $100 billion in India in areas of petrochemicals, infrastructure and mining among others, considering the country’s growth potential. Saudi Ambassador Dr Saud bin Mohammed Al Sati has said India is an an attractive investment destination for Saudi Arabia and it is eyeing long-term partnerships with New Delhi in key sectors such as oil, gas and mining.

“Saudi Arabia is looking at making investments in India potentially worth $100 billion in the areas of energy, refining, petrochemicals, infrastructure, agriculture, minerals and mining,” Al Sati said. He said Saudi Arabia’s biggest oil giant Aramco’s proposed partnership with Reliance Industries Ltd reflected the strategic nature of the growing energy ties between the two countries.

IRCTC IPO to open today

The initial public offer (IPO) of state-owned Indian Railway Catering and Tourism Corporation (IRCTC) will open for subscription on Monday, September 30. The offer is a part of the government’s divestment programme for the current financial year 2019-20 and shares will be offered to employees and retail investors at a discount to the final price. The issue will close on October 3. The book running lead managers to the issue are IDBI Capital Markets & Securities, SBI Capital Markets and YES Securities (India).

The issue comprises an offer for sale of 2,01,60,000 shares (representing 12.50 percent of total paid-up equity) of the face value Rs 10 each by the President of India. Out of the total issue size, 1,60,000 equity shares are reserved for eligible employees. The company has offered a discount of Rs 10 per Equity Share on the Offer Price for the retail category and to eligible employees.

The company aims to raise Rs 635.04 crore at Rs 315 per share, the lower end of price band and Rs 645.12 crore at Rs 320 per share, the higher end of the price band.

RBI may go for another rate cut on October 4: Experts

The RBI may cut the key policy rate again on October 4, the fifth in row, to complement the government’s measures like reducing corporate tax and promoting credit offtake to spur economic activity during the festive season amid range-bound inflation. The RBI Governor Shaktikanta Das headed Monetary Policy Committee (MPC) will announce the fourth bi-monthly monetary policy for 2019-20 on Friday, October 4, after its three-day meeting.

The central bank has already slashed the repo rate (short-term borrowing rate) four times aggregating to 1.10 percentage points since January. At its previous meeting in August, the MPC had reduced the benchmark lending rate by an unusual 35 basis points to 5.40 percent.

Anshuman Magazine, Chairman and CEO, India, South East Asia, Middle East and Africa, CBRE, said the government has taken a series of measures in the last few weeks to drive structural changes in the Indian economy. However, most of these are enabling provisions to ease supply side pressures while the key challenge of reigniting demand remains.

Foreign investors pour in Rs 7,714 cr into capital markets in Sept

After remaining net sellers for the past two months, foreign investors infused a net Rs 7,714 crore into the domestic capital markets in September following a slew of economic reforms by the government. The Centre last week slashed corporate tax rate by around 10 percentage points and also clarified that the enhanced tax surcharge will not apply on capital gains arising from sale of any security, including derivatives, in the hands of foreign portfolio investors (FPIs).

Besides, the Securities and Exchange Board of India (SEBI) simplified KYC requirements for FPIs and granted them permission to carry out off-market transfer of securities. As per latest depositories data, FPIs poured in a net Rs 7,849.89 crore into equities and withdrew a net Rs 135.59 crore from the debt segment between September 3-27, translating into a cumulative net inflow of Rs 7,714.30 crore.

Forex reserves decline by $388 mn to $428.57 bn

India’s forex reserves declined by $388 million to $428.572 billion for the week ended September 20 due to a slide in core currency and gold assets, the Reserve Bank said on Friday. The overall reserves had declined by $649 million to $428.960 billion in the previous reporting week. They had touched a life-time high of $430.572 billion in August this year.

In the week to September 20, foreign currency assets, a major component of overall reserves declined by $125 million to $396.670 billion, the RBI said. Expressed in US dollar terms, the foreign currency assets include the effect of appreciation or depreciation of non-US units like the euro, pound and the yen held in the foreign exchange reserves. During the week, the value of gold reserves declined by $259 million to $27.843 billion, making it the second consecutive week of decline in the value of the precious metal held by India, according to the data.

PE investment in India rises 59% in August on high value investments

Private equity investments in India stood at $2.11 billion (about Rs 14,700 crore) in August, a sharp increase of 59 per cent from the year-ago month, primarily driven by large-ticket transactions, despite the economic uncertainties surrounding the global economy, according to a Grant Thornton report. Private equity (PE) funding stood at $1.33 billion (about Rs 9,300 crore) in August 2018, Grant Thornton’s monthly PE Dealtracker for August 2019 report noted.

“The regulatory and policy framework in India continues to be favourable for heightened PE deal activity with values recorded at $2.1 billion, 1.6 times the August 2018 deal values, driven by eight high-value investments of and above $100 million each. This displays a strong desire among PE players to invest in India,” Grant Thornton India LLP Director Pankaj Chopda said.

“While policy actions and missteps have played an important role in shaping the global economic events and their impact on market sentiment, active policy stimulus will be the need of the hour to support deal activity in the face of adverse macro-economic indicators,” he added.

With inputs from Reuters & other agenciesSpecial Thursday Expiry on 7th Nov
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