Trends on SGX Nifty indicate a gap-up opening for indices

FPJ Web DeskUpdated: Tuesday, February 15, 2022, 08:49 AM IST
article-image
Asian stocks and US equity futures were mixed Tuesday morning as traders parsed geopolitical risks,/Representative image | Photo Credit: AFP

Trends on SGX Nifty indicate a gap-up opening for the indices. Indian markets could open mildly higher on Tuesday in line with mixed Asian markets today and despite mildly negative US markets on Monday, said Deepak Jasani, Head-Retail Research, HDFC Securities.

The trading theme for the day revolves around the Russian invasion of Ukraine, said Prashanth Tapse, Vice President (Research), Mehta Equities Ltd. This headwind could further accelerate to the biggest major market worry across globe: inflation. Nifty is likely to be in a trading range of 16,200-17,500 zone. Dalal Street could witness a major bust if Nifty slips its December 2021 lows at 16,410 mark, Tapse cautioned.

Nifty fell sharply for the second consecutive session on Feb 14 following weak global cues. It witnessed the worst one day percent fall in 10 months. At close, Nifty was down 3.06 percent or 531.9 points at 16842.8. In the process it became the worst performing index in the Asian region.

Nifty remains under pressure due to rising crude oil prices, the Russia Ukraine conflict, fear of fast rate hikes across the globe and subdued corporate results. Advance decline ratio dipped sharply to much under 1:1 and came in at the lowest since January 24. In case the Nifty goes below 16410 over the next three days, we can lock the recent high of 18,351 as an intermediate top and the Nifty could keep facing selling pressure on rises. Any relief on the Russia Ukraine front could result in a temporary bounce which may get sold into.

Asian stocks mixed

Asian stocks and US equity futures were mixed Tuesday morning as traders parsed geopolitical risks, worries about Federal Reserve policy tightening and steps by China’s central bank to support growth.

US stocks close lower

All three major US stock indexes finished lower for a third straight trading day on Monday, with the S&P 500 index racking up its biggest three-day drop since October 2020, as US allies warned of an imminent attack by Russian forces on Ukraine.

When trading began Monday morning, worries over Ukraine had appeared to ease somewhat after Russian Foreign Minister Sergei Lavrov suggested continuing talks with the US and its allies over security issues. But by the afternoon, Secretary of State Antony Blinken said the U.S. was closing its embassy in the Ukrainian capital of Kyiv and relocating operations 340 miles west to Lviv near the Polish border.

The yield on the US 10-year Treasury notes was 1.995 percent, compared with 1.951 percent at 3 PM Eastern on Friday.

Crude prices up

West Texas Intermediate crude for March delivery rose $2.36, or 2.5 percent, to settle at $95.46 a barrel on the New York Mercantile Exchange. That was the highest front-month contract finish since September 3, 2014.

CPI jumps to 6.01%

India's headline inflation rate based on the Consumer Price Index (CPI) jumped to 6.01 percent in January 2022, largely due to unfavourable base effect. At 6.01 percent, last month's CPI inflation reading is the highest in seven months. CPI inflation was 5.66 percent in December 2021.

Japan economy rebounds

Japan’s economy expanded 5.4 percent on an annualized basis in the final quarter of 2021 vs median forecast of 5.8 percent. The world's third-largest economy expanded an annualised 5.4 percent in October-December after contracting a revised 2.7 percent in the previous quarter, government data showed on Tuesday, falling short of a median market forecast for a 5.8 percent gain, Reuters said. The increase was driven largely by a 2.7 percent rise in private consumption, which accounts for more than half of Japan's gross domestic product (GDP). The expansion compared with market forecasts for a 2.2 percent gain.

Global markets decline

World shares slid on Monday as U.S. warnings that Russia could invade Ukraine at any time pushed oil prices to fresh seven-year peaks and sent investors scurrying to buy safe-haven government bonds they have mostly shunned this year, Reuters said.

Europe's STOXX 600 share index tumbled as much as 3.0 percent and spot gold headed toward its biggest single-day gain in four months even as Russia suggested it was ready to keep talking to the West to try to defuse the crisis. The United States is relocating its embassy operations in Ukraine from the capital Kyiv to the western city of Lviv, Secretary of State Antony Blinken said, citing the "dramatic acceleration in the buildup of Russian forces." Ukraine's government bonds slumped 10 percent to the lowest of the crisis while strength in bullion and the Swiss franc underscored the appeal of safe-havens even as Ukraine hinted at concessions to Russia.

F&O ban

Five stocks - BHEL, Indiabulls Housing Finance, Punjab National Bank, SAIL and Tata Power Company - are under the F&O ban today.

(To receive our E-paper on whatsapp daily, please click here. To receive it on Telegram, please click here. We permit sharing of the paper's PDF on WhatsApp and other social media platforms.)

RECENT STORIES

Mumbai updates: Process to recruit 7,000 police constables on, says Devendra Fadnavis

Mumbai updates: Process to recruit 7,000 police constables on, says Devendra Fadnavis

Mumbai: Uddhav Thackeray takes dig at BJP saying that some consider Mother India their property

Mumbai: Uddhav Thackeray takes dig at BJP saying that some consider Mother India their property

Uttar Pradesh reports over 1,000 fresh Covid cases in last 24 hours

Uttar Pradesh reports over 1,000 fresh Covid cases in last 24 hours

Bihar: Left legislators not to join Nitish Kumar cabinet, will extend support from outside

Bihar: Left legislators not to join Nitish Kumar cabinet, will extend support from outside

'We have not let anyone infiltrate our territory': Rajnath Singh in Jodhpur

'We have not let anyone infiltrate our territory': Rajnath Singh in Jodhpur