Trends on SGX Nifty indicate a negative opening for the broader index in India. Indian stock markets could open mildly lower in line with largely negative Asian markets today and despite lower US markets on Wednesday, said Deepak Jasani, Head-Retail Research, HDFC Securities.
Prashant Tapse, Vice President (Research) at Mehta Equities Ltd, said, "Volatility is likely to be the hallmark of today’s trade. Sentiments continue to remain depressed after yesterday’s huge losses and most importantly, the fall indicates that the Nifty bulls are vulnerable. Investors are likely to remain risk-averse to equities until the 10-year US Treasury yield slips from its fresh two-year high of 1.856 percent, and the yield on the 2-year bond stages corrective decline from 1.075 percent.
"Technically speaking, the benchmark Nifty needs to hold above 17,900 mark in today’s trade for any meaningful recovery. The technical landscape will turn aggressively bullish only above Nifty 18,389 hurdles. Nifty’s intraday hurdle is at 18,187 mark. Alternatively, expect a water fall of selling if Nifty slips below 17,900 mark," Tapse added.
Mohit Nigam Head - PMS, HEM Securities, said, "Benchmark Indices are expected to start their day in the red as trends on the SGX Nifty indicate a negative opening for the broader index in India with a loss of 76 points. Traders and investors may remain worried as a top WHO official said that it is not possible to end the COVID-19 virus as such viruses never go away and end up becoming part of the ecosystem, but asserted that it is possible to end this year the public health emergency caused by COVID-19 with a collaborative approach to fix inherent inequities in the system.
"On the technical front, the key resistance levels for Nifty50 are 18,300 followed by 18,500 and on the downside 17,700 followed by 17,300 can act as strong support. Key resistance and support levels for Bank Nifty are 38,500 and 37,500 respectively," Nigam added.
Nifty fell sharply for the second consecutive session on January 19 due to weak global cues. At close Nifty was down 0.96 percent or 174.6 points at 17938.4.
Nifty fell for the second consecutive session but ended a little above the intra day low. Advance decline ratio is below 1:1 but better than the previous day. Weak underlying sentiments continue as does the selling pressure from both sets of institutional investors. 18,081-17,813 is the band for the Nifty in the near-term, said Jasani.
Stocks to watch out for
Hindustan Unilever, Biocon, Asian Paints, Bajaj Finserv, Havells India, Persistent Systems, PNB Housing Finance, Agro Tech Foods, Reliance Industrial Infrastructure, Sasken Technologies, Shoppers Stop, South Indian Bank, Vimta Labs, VST Industries and some others are going to announce their quarterly numbers on January 20 which might add volatility in the market, added Nigam.
Asian stocks weak
Asian stocks struggled on Thursday following a retreat in US shares during a choppy Wall Street session shaped by company earnings reports and the implications of tighter monetary policy.
MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.4 percent as tech stocks in particular suffered as they had on Tuesday in Europe and on Wall Street.
Australia's main stock index shed 1.0 percent, while Japan's Nikkei hit a three-month low as worries over new curbs on businesses to halt a record surge in coronavirus cases curbed risk appetite. The two-year U.S. Treasury yield, which typically moves in step with interest rate expectations, rose 0.7 basis point to 1.047 percent late in the session after earlier trading lower. The yield on 10-year Treasury notes fell 1.8 basis points to 1.850 percent, after also trading lower.
US stocks finish lower
US stock benchmarks finished lower Wednesday, with the Nasdaq Composite booking its first close in correction territory since March, as sharply higher bond yields and elevated inflation rattle investors.
The Nasdaq Composite Index on Wednesday booked its first close in correction territory (down 10.7 percent since its November 19 record peak) since March with a rapid surge in Treasury yields, and expectations for interest-rate increases from the Federal Reserve blamed for the weakness in the once-highflying benchmark. The benchmark also finished below its 200-day moving average for the first time since April of 2020 on Tuesday.
The index has registered a correction, as defined, 65 times (not including Wednesday’s) since it was first launched in 1971 and of those corrections, 24 of them, or 37 percent, have resulted in bear markets, or declines of at least 20% from a recent peak.
West Texas Intermediate crude for February delivery closed up 1.8 percent to around $86.96 a barrel at their highest levels in more than seven years, following reports that an explosion disrupted flow through the Kirkuk-Ceyhan pipeline between Iraq and Turkey.
Fed to meet next week
The US Fed is scheduled to meet next Tuesday and Wednesday, though many think January will be too soon to pencil in the first interest-rate hike of the year.
China's central bank cuts lending rates again
China’s central bank cut its benchmark lending rates again on Thursday amid concerns about an economic slowdown in the world’s second-largest economy. The People’s Bank of China slashed the one-year loan prime rate by 10 basis points from 3.8 percent to 3.7 percent. The five-year loan prime rate was reduced by 5 basis points from 4.65 percent to 4.6 percent — it was the first cut since April 2020, at the height of the coronavirus pandemic in the country.
Oil prices rise
Oil prices rose for a fourth day after a fire on a pipeline from Iraq to Turkey briefly stopped flows, increasing concerns about an already tight short-term supply outlook. Brent crude futures settled up 93 cents at $88.44 a barrel. The international benchmark has gained 28 percent since the beginning of December. U.S. crude futures rose $1.53 to settle at $86.96 a barrel.
Gold rose more than 1 percent as a retreat in the dollar and geopolitical tensions surrounding Ukraine burnished safe-haven bullion's appeal. US gold futures settled up 1.7 percent at $1,843.20 an ounce.
The following companies will announce their quarterly results today (January 20): Hindustan Unilever, Biocon, Asian Paints, Bajaj Finserv, Havells India, Persistent Systems, PNB Housing Finance, Agro Tech Foods, Bajaj Holdings & Investment, Century Textiles & Industries, Container Corporation Of India, Cyient, Datamatics Global Services, Hatsun Agro Product, Lyka Labs, Bank Of Maharashtra, Mphasis, Reliance Industrial Infrastructure, Sasken Technologies, Shoppers Stop, South Indian Bank, Vimta Labs ,and VST Industries.