“Stock Market News: Trends in the SGX Nifty indicate a positive opening for the broader index in India on the back of a rally in Wall Street and mixed trading in Asian peers and rising speculation over a 25-bps rate hike by the RBI later today”
The market is expected to open in the green as trends in the SGX Nifty indicate a positive opening for the broader index in India with a gain of 73 points.
The BSE Sensex was down 221 points to 60,286, while the Nifty50 fell 43 points to 17,722 at the close on Tuesday and formed bearish candle on the daily charts with lower-high-lower-low formation, indicating temporary weakness in the market.
US stocks rallied to a convincingly higher close on Tuesday, but trade was choppy as investors digested comments from Federal Reserve Chair Jerome Powell about how long the central bank might need to tame inflation.
The Dow Jones Industrial Average rose 265.67 points, or 0.78 percent, to 34,156.69, the S&P 500 gained 52.92 points, or 1.29 percent, to 4,164 and the Nasdaq Composite added 226.34 points, or 1.9 percent, to 12,113.79.
Asian Markets
Asia-Pacific markets traded mixed on Wednesday, as Federal Reserve Chairman Jerome Powell overnight acknowledged that inflation is declining — a sign the central bank may soon pause its rate hikes.
The Nikkei 225 fell 0.34 percent, while the Topix gained 0.12 percent. The Kospi in South Korea rose 0.68 percent.
SGX Nifty
Trends in the SGX Nifty indicate a positive opening for the broader index in India with a gain of 73 points. The Nifty futures were trading around 17,803 levels on the Singaporean exchange.
RBI Monetary Policy
All eyes will be on RBI Governor Shaktikanta Das when he unveils the outcome of the crucial monetary policy review, the last one for this fiscal, and the first one in this calendar year.
Most experts feel that the Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) will hike the key policy rate by 25 basis points, while economists at SBI say that the central bank may hit the pause button, maintaining the current ‘withdrawal of accommodation’ stance. A host of factors will determine the MPC decision.
Oil surges more than 3% as Fed’s Powell eases rate hike concerns
Oil prices climbed more than 3 percent on Tuesday after the head of the US central bank eased market concerns over interest rate hikes, while recovering demand in China also boosted prices.
Brent crude futures were up $2.70, or 3.3 percent, to $83.69 a barrel, while US West Texas Intermediate crude futures rose $3.03, or 4.1 percent, to $77.14 per barrel.
Inflation starting to slow but long, ‘bumpy’ road ahead: Federal Reserve Chair Jerome Powell
US inflation is starting to cool but the road ahead will likely be long and bumpy, Federal Reserve Chair Jerome Powell warned Tuesday, adding that stronger-than-expected economic data could bring more rate hikes.
The US central bank has in recent months tempered its aggressive campaign to rein in surging inflation, opting for smaller increases to the benchmark lending rate after multiple steep hikes.
“If the data were to continue to come in stronger than we expect, and we were to conclude that we needed to raise rates more… then we would certainly do that,” Powell said.
Moody’s says Indian banks’ exposures to Adani ‘not large enough’
The risk to Indian banks due to the rout faced by Adani stocks are “limited”, Moody’s Investor Services said in a report released on February 7. The exposure of country’s lenders to the embattled business group is “not large enough”, it noted.
The ratings’ agency, however, underlined that risks for banks can increase if Adani “becomes more reliant on bank loans”.
The group’s access to funding from international markets can be curtailed “because of heightened risk perception”, Moody’s said, adding that in such a case, domestic banks may become the main source of funding. This, in turn, may result in “increases in banks’ exposures to Adani and greater risks for them”, it noted.
Results on February 8
Shree Cement, Adani Power, Adani Wilmar, Cummins India, Escorts Kubota, Dreamfolks Services, Endurance Technologies, Equitas Small Finance Bank, GATI, Gujarat Pipavav Port, Graphite India, HG Infra Engineering, Honeywell Automation India, IRCON International, ITD Cementation India, Minda Corporation, Samvardhana Motherson International, Narayana Hrudayalaya, Oberoi Realty, Piramal Enterprises, Speciality Restaurants, Symphony, Tracxn Technologies, Trent, and Windlas Biotech will be in focus ahead of its quarterly earnings on February 8.
FII and DII data
Foreign institutional investors (FII) sold shares worth Rs 2,559.96 crore, while domestic institutional investors (DII) purchased shares worth Rs 639.82 crore on February 7, as per provisional data available on the NSE.
Stocks under F&O ban on NSE
The National Stock Exchange has added Ambuja Cements on its F&O ban list for February 8, but removed Adani Ports from the same list. Securities thus banned under the F&O segment include companies where derivative contracts have crossed 95 percent of the market-wide position limit.
With inputs from Reuters and other agencies