Sensex drops more than 1%, Nifty below 16,300

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Benchmark equity indices opened negative on May 9, the first trading day of the new week. The Sensex was down 612.05 points or 1.12% at 54,223.53. The wider Nifty was down 174.50 points or 1.06% at 16,236.80. About 816 stocks were up, 1434 stocks were down and 138 stocks were unchanged.

Today’s focus would be on Mindtree, which announced a merger with L&T Infotech. The two independent listed IT services companies of Larsen & Toubro Group would together create the fifth largest IT services provider in India. The combined entity will be known as “LTIMindtree”.

Metals company APL Apollo was trading down 5.90% to Rs 895.95. The National Mineral Development Corporation slipped 3.15% to Rs 147.60. The Steel Authority of India fell 2.89% to Rs 87.35. Real estate stocks also came under selling pressure. Tata Power fell 7.57% to Rs 226.65. JSW Energy slipped 3.68% to Rs 289. Adani Green Energy slipped 3.22% to Rs 2,780.

None of the 30 scrips that are part of the Sensex benchmark traded in the positive today. Infosys, Bajaj Finserv Limited, HCL Technologies and Power Grid Corporation of India were the only Sensex winners.

Asian markets weak at start of trade

Asian markets got off to a shaky start on Monday as U.S. equity futures skidded early on rate worries, while a tighter lockdown in Shanghai stoked worries about global economic growth and a possible recession .

MSCI’s broadest index of Asia-Pacific stocks outside Japan fell 0.3% and the Japanese Nikkei 1.2%. Investors were also tense ahead of Wednesday’s U.S. consumer price report, where only a slight easing in inflation is expected, and certainly nothing to stop the Federal Reserve from hiking at least 50 points. base in June. Core inflation is actually expected to rise to 0.4% in April, from 0.3% the previous month, although the annual pace is falling a bit due to base effects.

US stocks close lower

All three major U.S. stock indexes closed lower on Friday, each posting another week of losses, as investors assessed April jobs data amid heightened fears of stagflation.

US employment data

The latest US jobs data confirmed expectations that the Federal Reserve will remain on its rate-hike path to combat stubbornly high inflation. The S&P 500 fell for a fifth straight week, its longest losing streak since June 2011. For the week, the Dow Jones and S&P 500 each slipped 0.2% while the tech-heavy Nasdaq Composite fell fell 1.5%. The Nasdaq Composite fell for a fifth straight week, marking its longest weekly losing streak since 2012.

The US economy added 428,000 new jobs in April, according to a report released Friday by the US Bureau of Labor Statistics. But an acute labor shortage showed little improvement last month, which could underscore concerns about inflation already at its highest level in 40 years. Economists polled by the Wall Street Journal had predicted 400,000 new jobs. The jobless rate remained unchanged at 3.6%, the government said on Friday, just above a 54-year low. Average hourly earnings declined, rising 0.3% in April against expectations of a 0.4% increase.

US stocks are expected to remain volatile

The US 10-year yield rose 5.8 basis points on Friday to 3.124%, the highest level since Nov. 13, 2018.

After a week of extraordinary turbulence, equities are expected to remain volatile as investors await further inflation data and monitor bond yield developments. The big report for the markets is Wednesday’s April Consumer Price Index. Economists expect high inflation, but it should ease from March’s pace of 8.5% year-on-year. A second inflation report, the Producer Price Index, which is a wholesale price indicator, is released on Thursday.

LIC IPO subscribed 1.79 times on Day 5

Life Insurance Corporation’s IPO, the nation’s largest public offering, was oversubscribed 1.79 times on the penultimate day of the offering on Sunday.

Against 16,20,78,067 shares on offer, 29,08,27,860 bids were received, according to stock market data as of 7 p.m. However, the Qualified Institutional Buyer (QIB) category is not yet fully subscribed. Offers have been received for 0.67 percent of the shares reserved for the segment, which shows a lackluster response.

As for non-institutional investors (NII), a total of 3,67,73,040 offers were received for 2,96,48,427 shares reserved for the class, reflecting a subscription of 1.24 times. Individual retail investors offered 10.99 crores of shares versus 6.9 crores of shares offered for the segment, resulting in a 1.59x oversubscription.

Of this total, the share of policyholders was subscribed 5.04 times, while that of employees was subscribed 3.79 times.

REITs withdraw Rs 6,400 cr

Foreign investors withdrew more than Rs 6,400 crore from the Indian stock market in the first four trading sessions of the current month when the Reserve Bank of India (RBI) and the US Federal Reserve raised interest rates.

Foreign Portfolio Investors (REITs) remained net sellers for seven months to April 2022, withdrawing a massive amount of over Rs 1.65 lakh crore from the shares. This was largely due to the expectation of a rate hike by the US Federal Reserve and the deteriorating geopolitical environment following Russia’s invasion of Ukraine.

Fuel prices unchanged

Fuel prices remained unchanged on May 9. Gasoline and diesel prices have been stable for 33 days. Petrol in Delhi costs Rs 105.41 per liter and diesel Rs 96.67 per litre. In Mumbai, the prices of petrol and diesel per liter are Rs 120.51 and Rs 104.77 respectively. In Chennai, petrol costs Rs 110.85 per liter and diesel Rs 100.94 per litre. In Kolkata, petrol is Rs 115.12 per liter and diesel Rs 99.83 per litre.

Results May 9

The following companies will release their quarterly results today: UPL, PVR, Godrej Agrovet, Infibeam Avenues, Dalmia Bharat, Gujarat Narmada Valley Fertilizers & Chemicals, 3i Infotech, Aarti Drugs, BASF India, Borosil, Central Bank of India, CMS Info Systems , Craftsman Automation, Vedant Fashions, Suven Pharmaceuticals, VST Tillers Tractors, ISMT, Mold-Tek Packaging, Visaka Industries and Vishwaraj Sugar Industries will release their quarterly results on May 9.

Posted: Monday 09 May 2022, 09:25 IST

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