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

Trends on SGX Nifty indicate a gap-up opening for the broader index in India. The Indian markets could open higher in line with mostly higher Asian markets today and despite mixed US markets on Wednesday, said Deepak Jasani, Head-Retail Research, HDFC Securities.

Nifty broke the 5-day losing streak on April 20, boosted by positive global cues. At close Nifty was up 1.05 percent or 177.9 points at 17,136.5.

Nifty has formed an inside bar i.e. the high low bar of April 20 is within those of April 19. This does not have any predictive value, said Jasani. Only when the high of April 19 (17,276) is breached, one can turn mildly bullish. On falls, 16959-16980 could provide support. The lower than normal volumes suggests that the upmove has got more to do with slower FPI sales than aggressive buying, Jasani added.

On April 20, the Sensex closed up 574.35 points or 1.02 percent at 57,037.50. The broader Nifty was up 177.80 points or 1.05 percent at 17,136.50.

Prashanth Tapse, Vice President (Research), Mehta Equities Ltd, said, gains in other Asian indices are likely to reflect in local gauges in early trades despite overnight fall in US markets. Helping the sentiment is the 10-year U.S. Treasury yield which fell to 2.88 percent after having touched 2.94 percent-- its highest level since late 2018. The recent continuous fall provides an opportunity for traders to lap up beaten-down stocks even though rising inflation concerns could keep markets on the edge. Nifty is likely to get support at 16,597 mark.

To regain momentum on the buy side, and from a chartist standpoint, the technical landscape will improve considerably only if Nifty closes above its biggest hurdles at 17,324 mark, Tapse added.

Asian stocks trade higher

Asian stocks traded mostly higher on Thursday as the market pondered a burgeoning debate around whether inflation is peaking that sparked a rally in Treasuries.

US stocks close mixed

US stock indexes posted a mixed finish Wednesday, with the Dow Jones Industrial Average lifted after solid earnings, while a plunge for shares of streaming giant Netflix Inc. drags down the Nasdaq as the S&P 500 ends with a small loss. Dow was driven to a second-successive higher close by positive earnings from consumer giant Procter & Gamble and IT firm IBM Corp .

The Dow Jones Industrial Average rose 249.59 points, or 0.71 percent to 35,160.79, the S&P 500 lost 2.76 points, or 0.06 percent to 4,459.45 and the Nasdaq Composite dropped 166.59 points, or 1.22 percentto 13,453.07. The communication services sector declined 4.1 percent although eight of the 11 major S&P 500 sectors gained, led by the real estate index which posted its best finish since January 4. The consumer staples benchmark was just behind it, climbing to a second-straight record close.

The yield on the 10-year US Treasury note fell to 2.836 percent from a Tuesday close of 2.941 percent, which was its highest since December 13, 2018.

Investors got a fresh glimpse into the Federal Reserve's economic outlook on Wednesday when it issued its "Beige Book" of economic conditions from late February to early April. The central bank reported the economy expanded at a moderate pace during that time, though business reported issues with high inflation and worker shortages.

India’s high growth rate positive for world: IMF

A high growth rate for India, as projected in the latest World Economic Outlook, is not only healthy for the country but also positive news for the world, Managing Director of the International Monetary Fund Kristalina Georgieva has said.

The IMF, early this week, projected a “fairly robust” growth of 8.2 percent for India in 2022, making it the fastest-growing major economy in the world, almost twice faster than China’s 4.4 percent.

The global growth has been projected at 3.6 percent in 2022, down from 6.1 percent in 2021.

IMF says India in much better place to face Ukrainian crisis

The successful macroeconomic management of the COVID-19 pandemic has resulted in a strong recovery of India’s economy because of which the country is in a better position to face the economic fallout of the current Ukrainian crisis, a top official from the International Monetary Fund has said.

Observing that India represents about seven per cent of the total world economy in purchasing power parity (PPP) terms and is one of the countries that are growing rapidly, IMF’s Mission Chief for India Nada Choueiri told PTI that India's growth is lifting the global economy and is very important for a well-functioning global economy.

Crude prices

Oil prices traded higher but in a narrow range on Thursday, after being rocked earlier in the week by supply losses from Libya and a worrying outlook for demand as the International Monetary Fund cut its global growth forecasts.

On Wednesday, Crude oil prices slipped in the early trading session amid demand concerns from the China but prices recovered from their lows after surprise decline in the U.S. inventories. In the international markets, WTI crude settled at $102.19 per barrel and Brent settled at $107.19 per barrel. Rahul Kalantri, VP-Commodities, Mehta Equities, said, Domestic markets settled on a weaker note at Rs 7,857 per barrel,down by 0.10 percent. Weekly inventories in the United States declined by 8.0 million barrels last week against expectations of an increase of 3.0 million barrels. Inventories were increased by 9.4 million barrels in the previous week. Crude oil prices were also supported due to weakness in the dollar index and Russia-Ukraine crisis.

Currency outlook

USDINR 27April futures contract showed profit taking at higher levels. On the daily technical chart a pair is trading above its resistance level of 76.1500. Rahul Kalantri , VP, Commodities,Mehta Equities said, We observed that a pair is unable to cross its resistance level of 76.70 and plunged again. Looking at the technical set-up, a pair is facing steep resistance around 76.70 levels and only sustain above these levels could show further strength. However, support is placed at 76.06 levels. We expect a pair could trade in the range of 76.06-76.70 and either side breakout of the range will give further directions.

Fuel prices steady

Prices of petrol and diesel remained steady for the fifteenth day in a row on Thursday. Accordingly, in Delhi, the price of petrol and diesel remains Rs 105.41 per litre and Rs 96.67 per litre respectively.

In Mumbai, the price of petrol was held unchanged at an all-time high of Rs 120.51 per litre. Diesel price also continues to be at Rs 104.77 a litre, the highest among metros. In Chennai, petrol costs Rs 110.85 per litre and diesel Rs 100.94 per litre. In Kolkata, petrol is at Rs 115.12 per litre and diesel Rs 99.83 per litre.

Petrol and diesel prices were last hiked by 80 paise a litre each on April 6, taking the total increase in rates in 16 days to Rs 10 per litre.

Quarterly results today

HCL Technologies, Nestle India, ICICI Lombard General Insurance Company, L&T Technology Services, Tata Communications, CRISIL, Cyient, Rallis India, Sasken Technologies, Shiva Cement, Betala Global Securities, Rajratan Global Wire, Roni Households, Shukra Jewellers, S&T Corporation, and Trident Texofab will release quarterly earnings today (April 21).

Bullion outlook

Gold Silver prices moved higher on Wednesday as the dollar reversed lower. Following Tuesday’s robust Housing Starts data, existing-home sales declined to take the luster out of Treasury yields. The yield differential moved in favor of the Euro and Yen, putting downward pressure on the Dollar. In international Gold settled at $1,955.60 per troy ounce, down by 0.17 percent and silver settled $25.27 per troy ounce, down by 0.47 percent. Domestic markets gold settled at Rs 52,628 down by 0.23 percent and silver settled at Rs 68,406 down by 0.53 percent. Existing home sales fell to a seasonally adjusted and annualized rate of 5.77 million units last month, down 2.7 percent compared to February’s annualized rate of 6.02 million homes. This is the second consecutive month home sales have declined.

Rahul Kalantri, VP Commodities, Mehta Equities Ltd., said, Factors like stubborn inflation, the onset of stagflation, geopolitical uncertainties, and slow growth will be supportive of gold prices and will help create a vision for any fall. Gold has support at $1938-1928, while resistance at $1962-1972. Silver has support at $24.90-24.68, while resistance is at $25.30-25.48. In INR terms gold has support at Rs 52,420–52,250, while resistance is at Rs 52,950–53,110. Silver has support at Rs 68,020- 67,650 while resistance is at Rs 68,740–69,210.

Stock under F&O ban on NSE

Tata Power is under the F&O ban for April 21.

(With inputs from Reuters)