PremiumAfter a substantial slump in the previous session, domestic equity benchmark indices opened on Thursday on a positive note. Major US stock indexes ended down slightly in the overnight session, losing early gains tied to remarks by Federal Reserve Chair Jerome Powell that the US central bank is "strongly committed" to bringing down inflation, while sharply lower oil prices weighed on energy shares. In Asia on Thursday, shares fell in Japan and South Korea, while it rose in Hong Kong, Shanghai, and Australia.
Shares of Gujarat Gas plunged to 52-week low level of ₹403 apiece on the BSE in Thursday's early deals. Domestic brokerage and research firm Motilal Oswal is bullish on Gujarat Gas shares while retaining the stock as its top pick in the sector.
Multibagger stock: Despite global economy reeling under pressure for more than last two years, Xpro shares have delivered staggering return to its shareholders in last two years. Such shareholders of the company includes 'Big Whale' Ashish Kacholia as well. The market magnet holds 4,21,616 Xpro India shares or 3.57 per cent stake in the company. In last two years, Xpro India share price has surged from around ₹31 to ₹1030 apiece levels, recording around 3200 per cent rise in this period. It is one of the multibagger stocks that Indian stock market has produced in last one year as it has delivered more than 450 per cent return in last one year.
Wider trade deficit driven by higher imports of goods led to India's current account slipping into deficit, at 1.2% of GDP for FY22 against a surplus of 0.9% of GDP in FY21.
In absolute terms, the deficit for FY22 came at $38.7 billion as against a surplus of $24 billion in the year-ago period, data released by the RBI showed.
Current account balances are generally taken as a key representative of a country's external strength, and a widening in the past had led to rupee depreciation and also actions by rating agencies on the sovereign rating.
Shares of Reliance Industries have corrected about 12% from its recent high. Multi year-low inventories, declining Russian exports, muted Chinese exports, lower diesel production in Europe and delays in commissioning of ME refineries are, in global brokerage Jefferies' view, tailwinds to refining margins in CY22.
Recovering from its record low, the rupee inched higher by 9 paise to 78.23 against the US dollar in early morning trade on Thursday.
At the interbank foreign exchange, the rupee opened at 78.26 against the American dollar, then inched higher to quote at 78.23, registering a rise of 9 paise from the previous close.
On Wednesday, the rupee declined by 19 paise to settle at an all-time low of 78.32 against the US dollar.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.05 per cent lower at 104.14.
Equity indices made a firm opening on Thursday after falling sharply in the previous trade, with BSE Sensex climbing 504.94 points amid mixed trends from global markets.
The 30-share BSE Sensex was trading with a gain of 504.94 points at 52,327.47. The NSE Nifty went up by 163.70 points to 15,577.
From the Sensex pack, Bharti Airtel, Wipro, Maruti, TCS, Larsen & Toubro and IndusInd Bank were the major gainers in early trade.
Gold prices inched lower on Thursday, pressured by expectations of aggressive interest rate hikes after the U.S. Federal Reserve chief doubled down on the central bank's fight against inflation.
Spot gold was down 0.2% at $1,832.91 per ounce by 0239 GMT. U.S. gold futures fell 0.2% to $1,834.30.
Bitcoin traded once again around the $20,000 level, underperforming stocks amid lingering concerns of a greater shakeout in the crypto market.
The largest cryptocurrency declined as much as 4.8% to $19,832, before settling in around $20,000 as of 3:11 p.m. in New York. Ether fell by a maximum 6.1% to $1,053. Solana, Cardano, Polkadot and Dogecoin all declined.
Asian stocks wavered Thursday, Treasuries held a rally and oil sank as investors parsed the economic outlook after Federal Reserve Chair Jerome Powell acknowledged the risk of a recession.
An Asian share index was steady, with a report that Hong Kong’s incoming leader John Lee is working on a strategy to reopen the city’s borders helping sentiment. US and European futures were in the red.
Treasuries were little changed after jumping in the Wall Street session, leaving policy-sensitive two-year yields at about 3.06%. Bonds jumped in Australia and New Zealand. The dollar and the yen inched higher.
In commodities, oil dropped 3% to under $103 a barrel, sapped by fears over the demand outlook. A raw-materials index is at the lowest since March.
India’s central bank appears to have ramped up intervention in the forwards market to slow the rupee’s decline and preserve its hard-earned reserves.
The Reserve Bank of India has run down its forward-dollar book by $12 billion to $15 billion from about $64 billion at the end of April, according to estimates by DBS Bank Ltd. Standard Chartered Plc. said the authority has significantly intervened through forwards.
The move shows the central bank is pulling out all the stops to curb losses in the currency, which set a series of record lows this month and threatens to further accelerate inflation. The RBI’s intervention strategy has caused dollar-rupee one-year annualized forward premiums to fall below 3% for the first time in a decade, according to Standard Chartered.
Oil retreated along with other key commodities as concern over a global economic slowdown intensified, with Federal Reserve Chair Jerome Powell warning that a US recession is possible.
West Texas Intermediate sank toward $103 a barrel after closing at a six-week low on Wednesday. The US benchmark has lost more than 15% since the close on June 8 as the drumbeat of warnings over the state of the world’s economy has grown steadily louder, drowning out signs the oil market remains tight.
Powell said while he didn’t see the likelihood of a recession as particularly elevated, it was a possibility. Commodity price hikes were “clearly" connected to the war in Ukraine, he said. Crude’s retreat has been accompanied by deep losses in other raw materials, especially base metals such as copper.
London copper prices dropped to a 16-month low on Thursday, as worried mounted that a rise in Covid-19 cases in key consumer China and aggressive U.S. interest rate hikes would tip the global economy into recession and slow metals demand. Three-month copper on the London Metal Exchange was down 1.7% at $8,628.50 a tonne, as of 0330 GMT, after dropping to its lowest since Feb. 19, 2021 at $8,564.50 earlier in the session. The most-traded July copper contract in Shanghai slipped 2.9% to 66,030 yuan ($9,848.02) a tonne by the midday break, hitting its lowest since late-August.
Sugar stocks have been nosediving for near one month after Government of Indian (GoI) levied excise duty on sugar export. Quality sugar stocks like Dhampur Sugar Mills, Mawana Sugars, Dwarikesh Sugar Industries, Shree Renuka Sugars, EID Parry, etc. have corrected heavily from its respective 52-week high.
The US economy remains strong but a series of aggressive rate hikes meant to cool soaring inflation could eventually trigger a recession, Federal Reserve Chair Jerome Powell cautioned Wednesday.
Powell, whose testimony before senators was closely watched by investors and analysts, also said the world's largest economy faces an "uncertain" global environment and could see further inflation "surprises."
The Fed chair again stressed that policymakers understand the hardships caused by rising prices and are committed to bringing down inflation, which has reached a 40-year high.
Last week, the US central bank announced the sharpest interest rate increase in nearly 30 years and promised additional similar moves to combat the price surge, with gas and food costs skyrocketing and millions of Americans struggling to get by.
An early look at the state of the US job market in June from payroll provider UKG suggests some strengthening, even as the Federal Reserve lifts interest rates sharply and economists raise alarms over the likelihood of a recession.
Workforce activity increased slightly in the first two weeks of the month, according to the firm which tracks shift work in real time. It mostly declined during the prior three months.
Particularly notable, the firm said, was an increase in demand for workers in retail, the first such increase since the start of the year.
That could be good news for Fed Chair Jerome Powell. On Wednesday he told US lawmakers the Fed was committed to bringing down too-high inflation, with a plan to raise borrowing costs high enough that demand for labour, goods and services subsides to levels more in line with supply.
Tokyo shares opened higher as investors gauged inflation and recession risks after US Fed chair Jerome Powell pointed to the need for further rate hikes.
The benchmark Nikkei 225 index rose 0.22 percent or 58.77 points to 26,208.32 while the broader Topix index added 0.41 percent or 7.62 points to 1,860.27.
Gold prices were a touch lower on Thursday, with some support from a weaker dollar and US Treasury yields, after the Federal Reserve's head said the central bank was fully committed to reining in inflation, and would try not to spark a recession in the process. Spot gold was down 0.1% at $1,835.88 per ounce by 0109 GMT. US gold futures also inched 0.1% lower to $1,837.30.
A choppy day of trading on Wall Street ended with a modest pullback for stocks Wednesday, the latest bout of volatility for the market amid concerns about inflation and uncertainty over whether rising interest rates will help or hinder the economy.
The indexes were on pace for a modest gain before slipping into the red in the final minutes of trading. The S&P 500 dropped 0.1%, with the stocks in the benchmark index about evenly split between gainers and decliners. The Dow Jones Industrial Average gave up 0.2% and the Nasdaq fell 0.1%.
Energy companies helped pull the market lower after the price of U.S. crude oil fell 4%. Technology companies also lost ground, which helped keep gains in health care, real estate and other sectors in check.
Investors closely watched testimony to Congress from Federal Reserve Chair Jerome Powell. He reaffirmed the central bank’s determination to raise interest rates and slow inflation.
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