The Markets could see a gap down opening tracking overnight fall in US markets and weakness in SGX Nifty.
The stock markets could open lower in line with negative Asian markets today and lower US markets on Wednesday, said Deepak Jasani.
Prashanth Tapse, Vice President (Research), Mehta Equities Ltd, said, Traders are concerned about more rate hikes going forward and the resultant impact on global economic growth. To make matter worse, FII selling has further intensified in past few weeks, indicating more gloomy sessions ahead. Technically, Nifty has support at 15,901 and below the same the index could retreat to 15,200-15,250 levels.
Mohit Nigam, Head - PMS, Hem Securities, said, the key reason given by investors and experts for the market's weakness is the Federal Reserve's policy adjustment. The Fed warned early in 2022 that it was shifting to tighter monetary policy in an attempt to tamp down soaring inflation, signalling a substantial shift in the investing climate.
Indian markets are seeing turbulent swings as investors continue to be concerned about rising interest rates, fears about slowing economic growth, and additional tightening measures in China. In the previous seven trading sessions, the Nifty has fallen by 6.5 percent. Even attitudes were shaky, as foreign investors dumped $1.82 billion in Indian shares so far this month. In these situations, investors should exercise caution and take advantage of any declines in fundamentally sound companies.
Immediate support and resistance for Nifty are 16,000 and 16,500 respectively. Immediate support and resistance for Bank Nifty are 34000 and 35,000 respectively, added Nigam.
Nifty once again ran into selling pressure at higher levels on May 11 in the morning session, though it bounced up well from the intraday lows made at 1320 Hrs. At close, Nifty was down 0.45 percent or 73 points at 16167.1, falling for the fourth consecutive session.
Nifty continues to look weak and some more downside is expected before stability and a short term reversal. 16,000-16,197 could be the band for the Nifty in the near term, added Jasani.
Asian stocks decline
Asian stocks fell Thursday after elevated US inflation bolstered the case for aggressive monetary tightening and sparked a slide on Wall Street.
US stocks close sharply lower
US stocks finished lower Wednesday, with the Dow booking its biggest 5-day drop in almost two years, following an eagerly awaited consumer price index reading that showed US inflation slowed less than anticipated in April.
The S&P closed at its lowest level since March 25 2021 and 18% below its Jan. 3 record finish. Nasdaq lagged its peers sharply as interest rate-sensitive growth sectors, technology and consumer discretionary, underperformed the rest of the market also closing down more than 3%. MSCI's gauge of stocks across the globe shed 0.88 percent, registering its lowest close since November 2020.
US consumer inflation slows
US consumer inflation slowed, with the annual pace at 8.3 percent versus the March reading of 8.5 percent. But it was still plenty hot, and above expectations for a reading of 8.1 percent. More problematic for investors was the core reading, which strips out volatile food and energy prices. It showed a 0.6 percentmonthly rise versus a Wall Street forecast for a 0.4 percent increase. The increase in the core rate over the past year also slowed to 6.2 percent from a 40-year high of 6.5 percent in March. The Labor Department's monthly consumer price index (CPI) report suggested inflation may have peaked in April but is likely to stay strong enough to keep the Federal Reserve's foot on the brakes to cool demand.
Oil futures jumps
Oil futures jumped, with the US benchmark closing up 6 percent to $105.71 a barrel after reports that COVID cases were easing in Beijing and Shanghai, driving hopes for an easing of restrictions and pressure on the global economy.
The US also posed a record $308 billion budget surplus in April as federal tax receipts surged, putting the government on a path to register a budget deficit in fiscal 2022 below $1 trillion for the first time since the start of the pandemic.
Treasury yields were mixed after the data, with that of the 10-year US note down 7.2 basis points to 2.918 il futures jumped, with the US benchmark closing up 6 percent to $105.71 a barrel after reports that COVID cases were easing in Beijing and Shanghai, driving hopes for an easing of restrictions and pressure on the global economy.
US posts record budget surplus
The US also posted a record $308 billion budget surplus in April as federal tax receipts surged, putting the government on a path to register a budget deficit in fiscal 2022 below $1 trillion for the first time since the start of the pandemic.
Treasury yields were mixed after the data, with that of the 10-year US note down 7.2 basis points to 2.918 percent.
Inflation slows down in Brazil
Brazil's inflation slowed in April but still posted the steepest rise for the month in 26 years, pushing the 12-month figure to over 12 percent amid continued pressures on food and fuel, official figures showed on Wednesday..
Brazil's inflation slowed in April but still posted the steepest rise for the month in 26 years, pushing the 12-month figure to over 12 percent amid continued pressures on food and fuel, official figures showed on Wednesday.
Investors poorer by over Rs 13.32 lakh cr in 4 days
A four-day decline in stocks has wiped out over Rs 13.32 lakh crore from the market capitalisation of BSE-listed firms.
Sliding for the fourth straight session, the BSE Sensex shed 276.46 points or 0.51 percent to close at 54,088.39 on Wednesday.In four days, the benchmark has lost 1,613.84 points or 2.89 percent.
Tracking the weak trend in equities, the market capitalisation of BSE-listed firms tanked Rs 13,32,898.99 crore in four sessions to stand at Rs 2,46,31,990.38 crore.
RBI likely to consider more rate hike in June
The Reserve Bank of India (RBI) is likely to raise its inflation projection for the current fiscal year at its June monetary policy meeting and will consider more interest rate hikes, a source aware of the development said on Wednesday, said Reuters.
In its first rate move in two years and its first hike in nearly four, the RBI raised the repo rate by 40 basis points (bps) to 4.40 percent following a emergency meeting earlier this month.
Morgan Stanley lowers India's growth forecast
Morgan Stanley has lowered India's gross domestic product (GDP) growth forecast for the current financial year to 7.6 percent citing high inflation and global slowdown.
The new growth projection is 0.30 percent lower from the earlier forecast. The brokerage firm has also lowered India's GDP growth forecast for the financial year 2023-24 to 6.7 percent, which is 0.30 percent lower from its earlier projection.
Gold, Silver declines
Gold prices fell by Rs 231 to Rs 50,646 per 10 grams in the national capital on Wednesday due to overnight losses in the precious metal in global markets, according to HDFC Securities.
Stock under F&O ban
Indiabulls Housing Finance is under the F&O ban for May 12.
(With inputs from Reuters, agencies)
