Trends on SGX Nifty indicate a cautious opening for the index in India with a 16-points gain. The Nifty futures were trading at 17,141 on the Singaporean Exchange around 07:30 hours IST.
Wall Street's main indexes hovered near record highs on Tuesday despite weakness in technology stocks, with the S&P 500 heading for a seventh straight month of gains as fears ebbed over near-term policy tightening by the Federal Reserve.
The Dow Jones Industrial Average rose 37.18 points, or 0.11 percent, to 35,437.02, the S&P 500 fell 0.25 points, or 0.01 percent, to 4,528.54, and the Nasdaq Composite lost 18.41 points, or 0.12 percent to 15,247.48.
"Indian markets could open flat to mildly higher, in line with largely positive Asian markets today and despite mildly lower US markets on Tuesday", said Deepak Jasani, Head-Retail Research, HDFC Securities.
"The Nifty is expected to open flat around yesterday's close at 17,130. Yesterday's up move in Nifty was accompanied by good volumes which indicates strength. Nifty has support in 17,000 and 16,930 range. Any correction in Nifty can be used to initiate long positions with strict stop-loss," said Gaurav Udani, Founder and CEO, ThincRedBlu Securities.
Nifty gained for the third consecutive day on Aug 31 and closed above 17,000 for the first time ever. At close, the Nifty was 201 points or 1.19 percent higher at 17,132.
Nifty sliced through 17,000 without much effort. A flat advance decline ratio on such a day denotes traders flocking to largecaps and taking profits out of mid and smallcaps. Nifty could now face resistance at 17250 while 16,951 could provide support.
Mohit Nigam, Head - PMS, Hem Securities said benchmark Indices are expected to open on a flat note as suggested by trends on SGX Nifty. Stock specific actions can be witnessed in stocks such as Maruti Suzuki (Company expects output to plunge in September as the semiconductor shortage), BHEL (Secured order worth Rs 10,800 crore from NPCIL), Wipro (Partnered with HERE Technologies to offer location-based services). Ami Organics and Vijaya Diagnostics IPOs to open today. Important data to watch today will be Markit India Manufacturing PMI for August (prior 55.3) at 10.30 AM.
"On the technical front; 16,900 and 17,100 are immediate support and resistance in Nifty 50."
Asian shares down
Asian shares gave up some of their recent gains in cautious trading on Wednesday while the dollar inched back from three-week lows, as worries about slowing global growth in several markets returned to weigh on traders’ minds.
MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.40 percent. Japan’s Nikkei gained 0.89 percent while Australian shares fell 0.58 percent.
Data to Watch
10:30 AM: Markit India Manufacturing PMI for August, prior 55.3.
US stocks decline on Tuesday
A gauge of global equities posted its seventh consecutive month of gains and a record closing high on Tuesday, but stocks and the dollar mostly ended the day little changed after US and Chinese economic data suggested slower growth ahead. US stocks closed lower Tuesday, as investors looked ahead to US jobs data for August coming Friday, where they might find clues as to when the Federal Reserve may begin tapering its bond purchases which have helped to support markets during the pandemic.
For August, the S&P 500, Dow and Nasdaq rose 2.9 percent, 1.2 percent and 4 percent, respectively. The dollar slipped to its lowest level in more than three weeks against a basket of currencies
US consumer confidence fell to a six-month low in August at 113.8 (vs 125.1 in July) as soaring COVID-19 infections and rising inflation dampened the economic outlook. The Chicago purchasing managers index dropped to 66.8 in August from a previous reading of 73.4.
Aluminium hits highest point since May 2011
The price of aluminum traded on the London Metal Exchange hit its highest point since May 2011, with three-month aluminum touching $2,726.50 a metric ton before settling around $2,650.
China factory activity slips
China's factory activity slipped into contraction in August for the first time in nearly 1-1/2 years as COVID-19 containment measures, supply bottlenecks and high raw material prices weighed on output in a blow to the economy. The Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) fell to 49.2 last month (vs 50.2 forecast), from 50.3 in July. breaching the 50-mark that separates growth from contraction.
South Korea's factory activity grew at a slower pace in August, as output contracted for the first time in 12 months. The IHS Markit purchasing managers' index (PMI) for August stood at 51.2, falling from 53.0 in July.
Chile’s central bank said on Tuesday it would raise its benchmark interest rate to 1.5 percent from 0.75 percent, as a rapid COVID-19 vaccination program helps the world’s top copper producer resume economic activity and inflation ticks upward. The bank began to withdraw monetary stimulus last month, lifting the rate to 0.75 percent after an extended period of maintaining it at 0.5 percent, its lowest point since the outbreak of the pandemic and associated lockdowns.
GDP growth up by 20.1%
The Indian central government's fiscal deficit stood at Rs 3.21 lakh crore or 21.3 percent of the budget estimates at the end of July. India's real gross domestic product (GDP) grew by 20.1 percent in the April-June quarter of the fiscal year 2021-22, a record quarterly print on the back of a low base last year. The biggest year-on-year rise was in the construction sector at 68.3 percent. Manufacturing, which fell 36 percent in April-June last year, bounced back to grow by 49.6 percent.
The Apr-July fiscal deficit figures for India at Rs 3.21 lakh crore or 21.3 percent of the budget estimates appear much better than the previous financial year, when it soared to 103.1 percent of the estimate, mainly on account of a jump in expenditure to deal with the COVID-19 pandemic. Total receipts stood at Rs 6.83 lakh crore or 34.6 percent of corresponding BE 2021-22 up to July 2021. The total receipts were 10.4 percent of the BE of 2019-20 in the same period of the last financial year. Total expenditure was Rs 10.04 lakh crore or 28.8 percent of the corresponding BE 2021-22. The expenditure was 34.7 percent of BE of 2019-20 in the same period last fiscal.
Oil inventories fall
Oil inventories fell more than expected last week, according to data from the American Petroleum Institute.
Crude inventories showed a draw of 4.045 million barrels. Expectations had been for a draw of 2.833 million barrels last week, against an actual draw of 1.622 the week before that.
The price of Crude Oil WTI Futures, the U.S. benchmark, fell 0.98 percent, to $68.52, after the data were released. Brent Oil Futures, the international standard, was down 0.8 percent, at $71.64.The industry report also showed a draw of 1.96 million barrels of distillate stocks but an increase of 2.71 million barrels of gasoline.
MapMyIndia files DRHP documents for IPO
Indian digital mapping firm MapMyIndia filed its DRHP documents on August 31, 2021. The initial public offering (IPO) will see an offer-for-sale up to 7,547,959 equity shares by selling shareholders, according to the draft red herring prospectus (DRHP).
“The objects of the Offer are to carry out the Offer for Sale of up to 7,547,959 equity shares by the Selling
Shareholders and achieve the benefits of listing the Equity Shares on the Stock Exchanges,” the DRHP read.