Global market update: SGX Nifty to SVB crisis — top triggers that may dictate Dalal Street today
4 min read . Updated: 13 Mar 2023, 07:48 AM IST
Premium- SGX Nifty today opened lower but soon gained buying momentum and hit intraday high of 17,407 levels
Global market update: On account of Silicon Valley Bank (SVB) crisis, Wall Street crashed on Friday logging its worst week since September 2022. The SVB crisis led to huge weakness in US dollar rates as Dollar Index came below 104 levels in early morning session on Monday. Meanwhile, SGX Nifty today has once again opened with downside gap, which signals weakness on Dalal Street in early morning deals.
Here we list out key global market triggers that may dictate India's stock market today:
US stock market
On Wall Street, the S&P 500 erased most of its 2023 gains, with 1.45 per cent losses on a daily basis. All eleven sectors fell to the negative territory, with eight sectors losing more than 1 per cent on Friday. It’s worth noting that the Real Estate and Material sectors dropped the most among all groups, falling 3.25 per cent and 2.15 per cent for the day respectively. Apart from this, the Nasdaq 100 also slumped with 1.4 per cent loss, the Dow Jones Industrial Average fell 1.1 per cent, and MSCI world index was dragged down with 1.4 per cent on Friday.
Speaking on reason for sell off at Wall Street, Marc Despallieres, Chief Strategy and Trading Officer at Vantage said, "A renewed bout of volatility rattled markets around the world as SVB Financial Group’s turmoil spurred concern about further distress in the banking industry at a time when the Federal Reserve is deploying its most-aggressive tightening campaign in a generation. Not even remarks from prominent voices that a systemic financial crisis is unlikely was able to tame investors. The trigger for further de-risking was the official news that Silicon Valley Bank became the biggest US financial failure in more than a decade, after its long-established customer base of tech startups grew worried and yanked deposits."
Asian markets today
During morning deals on Monday, the Japanese Nikkei is down by 1.71 per cent, Shanghai index is up 0.56 per cent, Hang Seng is up 0.90 per cent whereas South Korean KOSPI is down 0.59 per cent.
SGX Nifty today
Signaling weak stock market opening bell today on Dalal Street, SGX Nifty today opened lower at 17,342. But, the index soon gained buying momentum and hit intraday high of 17,407. Currently, SGX Nifty is quoting 62 points lower from its Friday close.
Advising buy on dips strategy to intraday traders, Anuj Gupta, Vice President — Research at IIFL Securities said, "Current fall in SGX Nifty today can be attributed to the weakness in US dollar, which is mainly due to the SVB crisis. The equity market may remain under pressure after the news break of Signature Bank collapse but US authorities including US President Joe Biden have come forward to rescue depositors money that may contain the fall in global equity markets including India."
SVB fallout
US administration unveiled series of measures on Sunday to rescue depositors' money in Silicon Valley Bank crisis. They promised other institutions help in meeting customers' needs, as they announced a second tech-friendly bank had been closed by regulators. With the two bank failures (SVB and Signature Bank) rattling nerves, President Joe Biden vowed to hold "fully accountable" the people responsible for "this mess" and said he would deliver remarks on Monday morning on maintaining a resilient banking system.
US dollar rate
After newsbreak of Silicon Valley Bank's bankruptcy, profit booking triggered in the US Dollar and Dollar Index soon came down below 105 levels. In early morning deals on Monday, Dollar Index further went down and slipped below 104 levels.
US bond yield
In early morning session, US 10 year bond yield has ascended 1.50 per cent to 3.750 levels whereas US 30-year bond yield has surged over 2 per cent to 3.775 levels.
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