What changed for D-Street while you were sleeping

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NEW DELHI: The ECB's 750 billion euro bond purchase announcement could not lift Asian markets from the rut this morning, though it helped crude oil prices recover from 18-year lows. Going by signals from Nifty futures trading in Singapore, domestic investors may be headed for another day of pain.Here’s breaking down the pre-market actions.TRADE SETUP…

NEW DELHI: The ECB’s 750 billion euro bond purchase announcement could not lift Asian markets from the rut this morning, though it helped crude oil prices recover from 18-year lows. Going by signals from Nifty futures trading in Singapore, domestic investors may be headed for another day of pain.Here’s breaking down the pre-market actions.TRADE SETUP
Singapore trading sets stage for gap-down startNifty futures on the Singapore Exchange traded 303.45 points or 3.59 per cent lower at 8,138.50, indicating a gap-down start for Dalal Street.
Tech view: Nifty forms long bearish candleThe index has been trading far below its key moving averages and the 14-day RSI at 14 suggests the index is in the deep oversold territory. Analysts do not rule out the index falling below the 8,000 level in the short term, as oscillators on the higher timeframe charts are displaying incremental pain ahead.
Asian markets mixed in early tradeMSCI’s broadest index of Asia-Pacific shares outside Japan dipped 0.25 per cent amid choppy trade throughout the region, with Australia’s benchmark running as much as 3 per cent higher before returning to flat. US stock futures turned positive and rose nearly 2 per cent after the ECB announced a bond-buying programme. Japan’s Nikkei opened 1.4 per cent higher.
US stocks plunge up to 6%The Dow Jones Industrial Average fell 1,338.46 points, or 6.3 per cent, to 19,898.92, the S&P500 index lost 131.09 points, or 5.18 per cent, to 2,398.1, and the Nasdaq Composite dropped 344.94 points, or 4.7 per cent, to 6,989.84.
Oil jumps on ECB stimulusOil prices rebounded strongly a day after US crude hit its lowest level for 18 years, as the European Central Bank launched a bond-buying scheme to combat the coronavirus pandemic. US benchmark West Texas Intermediate was up almost 17 per cent at nearly $24 a barrel, a day after plunging 24 per cent. International benchmark Brent crude was up 8.5 per cent at $27 a barrel, a day after slumping 14 per cent.
FPIs sell Rs 5,085 crore worth of stocksNet-net, foreign portfolio investors (FPIs) were sellers of domestic stocks to the tune of Rs 5,085 crore on Wednesday, data available with NSE suggested. DIIs were net buyers to the tune of Rs 3,636 crore, data suggests.
MONEY MARKETSRupee: The rupee pared initial gains to close marginally down by 2 paise at 74.26 against the US dollar on Wednesday amid sustained foreign fund outflows and heavy selling in domestic equities.
10-year bonds: India 10-year bond yield rose 0.51 per cent to 6.30 after trading in 6.21-6.34 range.
Call rates: The overnight call money rate weighted average stood at 4.97 per cent, according to RBI data. It moved in a range of 3.70-5.15 per cent. 750 billion euros on “emergency” bond purchases, as it joined other central banks in stepping up efforts to contain the economic damage from the coronavirus. The decision came after the bank’s 25-member governing council held emergency talks by phone late into the evening, following criticism the bank wasn’t doing enough to shore up the eurozone economy.
HAPPENING TODAYJapan Feb Core Inflation Rate
Australia Money Policy Review
Japan Jan All-Industry Activity
US March Initial Jobloss Claims
US Q4 Current Account
MACROSECB launches 750-bn euro stimulusThe European Central Bank launched a 750 billion euro ($820 billion) emergency bond purchase scheme after an unscheduled meeting on Wednesday, attempting to stem a spiraling economic and financial crisis. With much of Europe in lockdown amid the coronavirus outbreak, economic activity has come to a near standstill and markets have been in a tailspin. US President Donald Trump moved on Wednesday to accelerate production of desperately needed medical equipment to battle the coronavirus pandemic and said an estimate that US unemployment could conceivably reach 20 per cent was a worst case scenario.
S&P cuts India’s growth outlook to 5.2%S&P Global Ratings has lowered India’s 2020 growth forecast to 5.2 per cent from 5.7 per cent estimated earlier, citing a global recession resulting from the impact of the Covid-19 pandemic. In an assessment of the Asia-Pacific region released on Wednesday in Singapore, S&P said India is also among the countries most vulnerable to capital outflows. “An enormous first-quarter shock in China, shutdowns across the US and Europe, and local virus transmission guarantees a deep recession across Asia-Pacific,” said Shaun Roache, chief Asia-Pacific economist at S&P Global Ratings.
RBI plans Rs 10,000 crore liquidity injectionThe Reserve Bank of India would enhance market liquidity with an additional bond purchase for as much as Rs 10,000 crore to prevent yields spike in corporate bond markets, opening up the possibility of intervention in markets beyond the government bonds and inter-bank markets. The central bank would purchase bonds in the shorter end of the tenor mostly bonds maturing in 2, 3 and 4-year basket as these have a direct impact on the corporate bonds market and the pricing of commercial papers (CPs).
BofA cuts March quarter growth forecast to 4%Wall Street brokerage Bank of America Securities has cut its March quarter growth forecast for India by 30 bps to 4 per cent, amid coronavirus pandemic-driven shutdowns and expects a cut in key benchmark rates on or before the April 3 monetary policy review. The brokerage expects the pandemic-driven lockdowns to run through mid-April, crippling economic activities across the value-chain. The agency also pegged down FY20 growth forecast to 4.7 per cent and FY21 to 5.1 per cent, respectively, assuming a 2.2 per cent global growth.
India mulls $1.6 billion aviation rescueIndia is planning a rescue package worth as much as $1.6 billion for the aviation sector, which has been battered after the coronavirus outbreak forced countries to close borders and brought air travel to a near-halt, reports Reuters. The Finance Ministry is considering a proposal that includes temporary suspension of most taxes levied on the sector, including a deferment of aviation fuel tax. The rescue package, proposed by India’s civil aviation ministry, is likely to be worth up to Rs 100-120 billion ($1.3-$1.6 billion).
FMCG revival hopes dashedConsumer goods market for essentials, groceries, household products, smartphones and electronics are seeing further moderation in growth, belying expectations of a revival during quarter ended March. The FMCG market grew 1% during January, a sharp fall from 2.4 per cent the same month, a year ago according to a latest study by Kantar Worldpanel. In fact, unlike previous quarters where slowdown was largely led by rural markets, latest data revealed that urban growth, at 0.2 per cent, dragged down the entire segment even as hinterland consumption remained that same at 1.8 per cent.
SC slams DoT, telcos over AGR self-assessmentThe Supreme Court on Wednesday banned any further reassessment or self-assessment of telcos’ adjusted gross revenue (AGR) dues, dubbing attempts to reopen the issue as tantamount to fraud and contempt of court, and ordering that operators pay interest and penalties in full. The court, however, agreed to consider the government’s plea on allowing affected telcos to stagger payments over 20 years or less. Bharti Airtel, Vodafone Idea and Tata Group’s self-assessment of dues to the government are a whopping Rs 82,300 crore short of what the telecom department calculated after the Supreme Court’s ruling.
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