2023-05-11 06:18:17
News and Impact
· Expects markets to open on a positive note on account of rally in the global market after US inflation data came in slightly cooler than expected, giving the Federal Reserve room to pause interest-rate increases soon. Both April CPI and Core Inflation data fell first time nearly 2-years. US Tech major Nasdaq climbed up over 1% after a key gauge of US consumer prices (CPI) showed signs of moderating in April, fuelling optimism that the Federal Reserve may soon pause its campaign of interest-rate increases. US consumer prices rose 0.4% in April with headline CPI up 4.9% on a year-on-year basis (expectation was 5%), its first reading below 5% in two years while Core Inflation announced inline with expectation at 5.5%. As a results, US 10-Year and 2% Year bond fell sharply to below 3.5% and 4% respectively.US Production Price Index (PPI) will be release today which is also important indicator for the health of the economy. Asian markets recovered after China announced April CPI at 0.1% while expectation was 0.3%. SGX Nifty is up quarter percent or 50 points. Yesterday, domestic market advance quarter percent and Nifty 500 stocks advance decline ratio was favorable at 1.4 :1. Expects rally to continue on account of strong FIIs inflow and good quarterly results which may support local market. FIIs were net buyers nearly $1.5bn or Rs11426cr this month. Moreover, fall in oil price, stable USDINR and favorable micro data to be positive sentiment in the market. Beaten down IT stocks will be in focus on account of attractive valuation. Expects positive for tyre, auto and NBFC stocks after announced impressive quarterly results.
· MSCI Index Review - MSCI May Index Review Announcement Scheduled for May 11, 2023
· ADR/GDR stocks Update – Dr Reddy down 3%, Tata Steel down 2%, L&T down 1.4%, Reliance up 1.3%, HDFC Bank up 3.5%
· US Market –.US stocks posted modest gains in a listless session, while Treasuries rose after a report showed inflation moderated slightly in April and swaps traders upped bets the Federal Reserve will cut rates this year. Nasdaq Composite gained over 1% while Dow Jones ended on a flat note. US consumer prices rose 0.4% in April with headline CPI up 4.9% on a year-on-year basis (expectation 5%), its first reading below 5% in two years. That is still well above the 2% level targeted by the Fed.
· Global market summary – US April Inflation at 4.9% vs 5% (YoY)– Expectation 5%. US Core Inflation at 5.5% vs 5.6% (YoY) – expectation. US 10-Year and 2% Year bond fell to below 3.5% and 4% respectively. China April CPI at 0.1% vs 0.7% (YoY) – expectation 0.3%. China April PPI at -3.6% vs -2..5% (YoY) – expectation -3.3%. U.S. Crude-Oil inventories rise for 1st time in 4 weeks.
· Asian Market –Asian market are witnessing mixed bag while US equity futures extended on gains for US stocks as inflationary pressure eased. The dollar held losses from the prior session after a drop in Treasury yields. South Korea Index gained half percent while Taiwan and Japan Market marginally decline.
· European Market – European stocks declined after briefly bouncing on cooling US inflation, with investors also assessing a slew of corporate earnings as well as the possibility of a US recession. UK, France and Germany Index declined half percent each.
· Oil – Brent crude declined 1% to $76/bbl on account of rising US oil inventory. US oil inventory surged first time in four weeks.
· Gold – Gold was steady at $2035/ounce amid signs that US inflation is cooling, fueling speculation that the Federal Reserve will soon pause tightening.
· Previous Day market Update – Equity benchmark Nifty ended with modest gain to close above 18300 level ahead of key US Inflation data to be release today which would give some insight on the outlook for interest rates. There was rally in index heavyweights Reliance, HDFC Bank, and Bajaj Finance that lifted market in the later part of the day. Sensex advanced 179 points or 0.30% to settle at 61,940.
2.1K viewsAdv Dhananjay Kadam, 03:18
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