The stock market indices opened weak amid largely negative Asian markets today and lower US markets on Thursday. At 09:16 AM, the Sensex was down 392.12 points or 0.64 percent at 60,843.18. The broader Nifty was down 114.30 points or 0.63 percent at 18,143.50. About 909 shares have advanced, 1,151 shares declined, and 89 shares are unchanged.
Among major losers on the Nifty at the opening bell were HDFC, HCL Tech, Asian Paints, Wipro and UPL. Cipla, IOC, L&T, Titan Company and Divis Labs were among early gainers.
Asian stocks decline
Asian stocks dropped Friday after a raft of Federal Reserve officials signaled they will combat inflation aggressively and the Nasdaq 100 fell to its lowest level since October.
US stocks close lower
US stocks closed down on Thursday, as a rebound in technology shares stalled out, snapping a three-day winning streak for the Nasdaq Composite. The S&P's technology index fell 2.7 percent while consumer discretionary fell 2 percent.
The Dow Jones Industrial Average fell 176.7 points, or 0.49 percent, to 36,113.62, the S&P 500 lost 67.32 points, or 1.42 percent, to 4,659.03 and the Nasdaq Composite dropped 381.58 points to 14,806.81.
Shares of technology companies, expected to see revenue and earnings grow faster than average, fell on Thursday, reviving a trend from the start of 2022, when Treasury yields rose rapidly in response to expectations the Federal Reserve will be much more aggressive than previously anticipated in fighting surging inflation.
Several Fed officials spoke publicly about battling high inflation with Lael Brainard the latest, and most senior, US. central banker signaling that the Fed was getting ready to start raising rates in March.
On Thursday, a reading of US wholesale inflation — the producer-price index — receded but still held around 9.7 percent year-over-year annualized rate compared with a nearly 40-year high of 9.8 percent in the prior month. The monthly rise of 0.2 percent was the lowest in 13 months.
Dollar headed for largest weekly fall in 8 months
The US dollar headed for its largest weekly fall in eight months on Friday as investors trimmed long positions and deemed, for now, that several US rate hikes this year are fully priced in, Reuters said. The dollar index is down about 0.9 percent for the week, on course for its largest weekly percentage fall since last May and set to halt a rally that has lasted about six months. The index last held at 94.849 in quiet Asia trade.
South Korea raises interest rate to pre-pandemic level
South Korea’s central bank raised its benchmark rate back to where it was before the pandemic on Friday, seeking to restrain inflation and household debt growth as global policymakers move to end emergency stimulus to contain rapid consumer price rises.
The Bank of Korea’s monetary policy board lifted borrowing costs by 25 basis points to 1.25 percent, the highest since March 2020, a move expected by 25 of 35 analysts in a Reuters poll.
India's share of merchandise exports at record high in December
India’s merchandise exports and imports rose to a record in December, causing the trade deficit to remain elevated despite having narrowed over the preceding month. Trade deficit eased to $21.68 billion in December 2021 from $22.91 billion in November, according to data published by the Ministry of Commerce and Industry on Thursday. Exports rose 38.9 percent year-on-year to $37.8 billion and imports increased 38.6 percent over the preceding year to $59.5 billion. Month-on-month, exports rose 25.8 percent and imports increased 12.4 percent.
China's December exports up
China's exports rose 20.9 percent year-on-year in December and imports jumped 19.5% over the same period, customs data showed on Friday. Analysts in a Reuters poll had expected exports to increase 20 percent last month after jumping 22 percent in November.
Imports were seen rising 26.3 percent following a 31.7 percent gain in November, according to the poll. China posted a trade surplus of $94.46 billion last month, versus a forecast for a $74.50 billion surplus in the poll. China reported a $71.72 billion surplus in November.
Indian economy forecast to grow 6.5% in FY 2022: UN
India is forecast to grow at 6.5 percent in fiscal year 2022, a decline from the 8.4 percent GDP estimate in previous financial year, and while the country’s economic recovery is on a ''solid path'' amid rapid vaccination progress, coal shortages and high oil prices could put the brakes on economic activity in the near term, the UN said on Thursday.
Gold trades mixed
COMEX gold trades mixed near $1820/oz after a minor 0.3 percent decline yesterday, said Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities. Market players assess Fed’s monetary policy stance in light of US economic data and central bank comments. US inflation data released this week was mixed while Fed officials are supporting faster rate hikes. Support from virus concerns, geopolitical issues and concerns about Chinese economy is countered by persistent strength in equities, ETF outflows and higher yields. Gold continues to trade within $1780-1830/oz range and this may continue unless there is more clarity on Fed’s stance. Higher yields and stable equities may however keep pressure on price.
Crude low
NYMEX crude trades modestly lower near $81.8/bbl after yesterday’s 0.6 percent decline. Crude oil has stalled after moving closer to $83/bbl level. Pause in equity market rally, improving supply situation relating to Libya, Kazakhstan and Indonesia, rising virus cases and mixed inventory report weighed on crude price. Crude’s sharp rally made it vulnerable to profit taking however a sharp fall may be seen only if equities also correct sharply, said Rao, Kotak Securities
Three stocks under F&O ban
Three stocks - Indiabulls Housing Finance, Vodafone Idea, and SAIL - are under the F&O ban for January 14.
(With inputs from Reuters and agencies)
