An ongoing selloff in Adani Group stocks further pressured domestic equities.
Wall Street equities fell on Friday after nonfarm payrolls rose by 517,000 jobs in January, way above a Reuters estimate of 185,000.
The strong report heightened fears that the Fed might continue its rate hike trajectory, with interest rate futures now pointing to chances of the central bank delivering at least two more rate hikes.
Indian information technology stocks fell over 1.1%, with nine of the 10 constituents logging losses on rate-hike concerns in the U.S.
IT companies in the country count some of the biggest U.S. firms as their clients. Any potential slowdown in the world’s largest economy typically has an adverse impact on the companies’ growth prospects.
Meanwhile, analysts said that the selloff in Adani stocks had created panic in Indian markets. Ratings agency Moody’s warned that the tumble in Adani group stocks could hit the conglomerate’s ability to raise capital.
Thirty nine of Nifty 50 constituents declined, with Adani Enterprises falling the most while ITC and State Bank of India advanced after reporting better-than-expected rise in net profit in third quarter, post market hours on Friday.
Asian markets too slid on Monday, with the MSCI’s broadest index of Asia-Pacific shares outside Japan shedding 1.83%.
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Fitch Ratings says Indian banks’ margins face pressure in FY24
- Indian banks’ net interest margin will face pressure in financial year ending March 2024
- Expect Indian banking sector’s average NIM to slightly contract by about 10bp in FY24 to 3.45% but remain well above that in prior years
- 10bp reduction in NIM that we currently expect under our base case is unlikely to affect Indian banks’ profitability in near term
FPI selling in Indian stock hits 7-month high on rich valuations, Adani rout
The selling coincided with a slide in equity benchmarks, with Nifty 50 falling 2.45% in the first month of 2023.
Analysts cited multiple reasons – the uncertainties due to a sharp selloff in Adani group stocks after a Hindenburg Research report flagged concerns over the conglomerate’s financials, expensive valuations of Indian shares over their global peers, reallocation of funds to China and Taiwan for their relatively cheaper valuations, and Beijing’s reopening, easing COVID-19 controls.
Vi, Indus shares jump after Govt clears conversion of telco’s accrued interest
Price as on 06 Feb, 2023 09:41 AM, Click on company names for their live prices.
Market View: Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services
Globally, the surprise element is the robust job numbers in the US which came at 517000 in January. This tight labour market in the US indicates continuing strength in the U.S. economy and the possibility of US recession receding. At the same time the Fed will be forced to remain hawkish for an extended period of time. The US CPI data to be published on 14th February will be keenly watched by the market.
Most Adani stocks locked in lower circuits
Price as on 06 Feb, 2023 09:24 AM, Click on company names for their live prices.
Rupee falls 35 paise to 82.43 against US dollar in early trade.
EARNINGS IMPACT | State Bank of India on Friday reported a 68.5% year-on-year (YoY) increase in net profit for the quarter ended December 2022 to Rs 14,205.34 crore. This was the highest-ever quarterly profit posted by India’s largest bank. The figure also beat ET Now poll estimate of Rs 13,500 crore by a wide margin.
Price as on 06 Feb, 2023 09:21 AM, Click on company names for their live prices.
Top movers in morning trade
Price as on 06 Feb, 2023 09:20 AM, Click on company names for their live prices.
EARNINGS IMPACT | ITC reported a 21% year-on-year (YoY) rise in net profit for the quarter ended December to Rs 5,031 crore, which was higher than the ET Now poll of Rs 4,605 crore. Revenue from operations, net of excise duty, rose a meagre 2.3% on year to Rs 16,226 crore, and trailed estimates of Rs 16,810 crore.
Price as on 06 Feb, 2023 09:20 AM, Click on company names for their live prices.
EARNINGS IMPACT | One97 Communications reported a consolidated net loss of Rs 392 crore for the quarter ended December, but the payment gateway services provider turned positive at the operating level three quarters ahead of its guidance. However, the net loss has narrowed from Rs 779 crore a year ago.
Price as on 06 Feb, 2023 09:20 AM, Click on company names for their live prices.
Opening Bell: Sensex falls 200 pts, Nifty tests 17,800; Paytm rallies 7%, Adani Ent tumbles 8%
Pre-open session: Sensex up 5 points; Nifty above 17,825
Asia shares slip, dollar up as U.S. rate outlook shifts
Asian shares eased on Monday after a run of upbeat economic data from the United States and globally lessened the risk of recession, but also suggested interest rates would have to rise further and stay up for longer.
Quarterly earnings today
Tata Steel, Adani Transmission, Varun Beverages are among a host of companies that will announce their third quarter results on Monday
SGX Nifty signals a negative start
Nifty futures on the Singapore Exchange traded 23 points, or 0.13 per cent, lower at 17,817, signaling that Dalal Street was headed for a negative start on Monday.
Tech View: Nifty forms bullish candle
Nifty today formed a bullish candle with a longer lower shadow on the daily and weekly scale, which indicates buying interest on declines.
Wall Street ends down after stunning jobs growth raises Fed questions
Major U.S. stock indexes ended lower on Friday after surprisingly strong jobs data sparked concerns about aggressive Federal Reserve action, while investors digested a mixed bag of megacap company earnings reports.
Oil prices edge higher as IEA’s Birol talks up China demand outlook
Oil prices inched up in early trade on Monday after falling around 8% last week to more than three-week lows as jitters over major economies outweighed signs of a demand recovery in China, the world’s top oil importer.
Rupee gains 12 paise against US dollar on rally in equities
The rupee appreciated 12 paise to close at 82.08 against the US currency on Friday, supported by a rebound in domestic equities and easing crude oil prices.
Sensex, Nifty on Friday
The BSE Sensex index ended 910 points or 1.52% higher at 60,842, while Nifty50 rose 244 points or 1.38% to settle at 17,854.
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