Nifty today: SGX Nifty up 100 points; here’s what changed for market while you were sleeping

Domestic stocks look set to extend Monday’s gains on Tuesday, thanks to supportive global cues. All eyes will be on the listing of Indigo Paints and quarterly earnings of HDFC and Tata Consumer, among others. Post-Budget reactions of different stocks and sectors would also be followed keenly.

Here’s breaking down the pre-market actions.

STATE OF THE MARKETS
SGX Nifty signals gap-up start
Nifty futures on the Singapore Exchange traded 97 points, or 0.68 per cent, higher at 14,455.50 in signs that Dalal Street was headed for a gap-up start on Tuesday.

Tech View: Nifty forms Long White candle

Nifty50 reclaimed the 14,200 level in style on Monday, and formed a Long White candle on the daily chart to the surprise of many. The sharp gains made analysts believe that the NSE benchmark found a bottom at its recent low at 13,596 level. They said profit booking cannot be ruled out after Monday’s rise, but any fall could trigger buying.

Asian markets rise in early trade

Asian markets opened higher on Tuesday as global markets faced another chaotic week, with retail investors expanding their duel with Wall Street into commodities and driving up the price of silver. In early Asian trade, Australia’s S&P/ASX 200 benchmark was up 0.81 per cent and South Korea’s KOSPI added 0.79 per cent. Japan’s Nikkei rose 0.73 per cent and Hong Kong’s Hang Seng index climbed 1.32 per cent.

rises as producers look to cut output

Oil prices rose around 1 per cent after major producers showed they were cutting crude output in line with their commitments on restraint, supporting a market thrown out of kilter by weak demand during the coronavirus pandemic. Brent crude was up 51 cents, or 0.9 per cent, at $56.86 a barrel, while US oil gained 53 cents, or 1 per cent, to $54.08 a barrel. Both contracts rose more than 2 per cent in the previous session.

US stocks settled higher

The S&P 500 registered its biggest daily percentage gain since November 24 on Monday after a steep sell-off last week, and technology-related shares led the advance, while a move by retail traders into silver drove up mining shares. The Dow Jones Industrial Average index rose 229.29 points, or 0.76 per cent, to 30,211.91, the S&P500 index gained 59.62 points, or 1.61 per cent, to 3,773.86 and the Nasdaq Composite added 332.70 points, or 2.55 per cent, to 13,403.39.

Indigo Paints to make market debut today

The paints makers looks set to make a strong market debut on Tuesday, as sentiment turned euphoric in the secondary market post Union Budget 2021. The scrip was commanding a grey market premium of Rs 820 apiece post the Budget after plunging to Rs 700-720 levels a day ago, thanks to six days of relentless selling pressure in the secondary market correction that was eventually snapped by Monday’s mega rally.

Q3 earnings today

HDFC, Tata Consumer: HDFC, Escorts Tata Consumers, PI industries, Dixon Technologies, Ajanta Pharma, Vinati Organics, V Mart, Balrampur Chini and Intellect Design are among companies which will announce their December quarter results on Tuesday.

FIIs buy Rs 1,494 crore worth stocks

Net-net, foreign portfolio investors (FPIs) were buyers of domestic stocks to the tune of Rs 1,494 crore, data available with NSE suggested. DIIs were net buyers to the tune of Rs 90.46 crore, data suggests.

MONEY MARKETS

Rupee: The rupee depreciated by 6 paise to close at 73.02 against the US dollar due to fiscal concerns after the government projected a higher fiscal deficit for 2020-21 and increased borrowing in the budget presented by Finance Minister Nirmala Sitharaman.

10-year bonds: India 10-year bond yield rose 1.87 per cent to 6.06 after trading in 5.88-6.07 range.

DATA/EVENTS TO WATCH

Q3 Earnings: HDFC I Tata Consumers I ION Exchange I Escorts I Dixon
India Balance of Trade Prel Dec (06:50 pm)
India Exports Prel Jan (06:50 pm)
India Imports Prel Jan (06:50 pm)
Australia RBA Interest Rate Decision (09:00 am)
UK Nationwide Housing Prices YoY Jan (12:30 pm)
Euro Area GDP Growth Rate QoQ Flash Q4 (03:30 pm)

MACROS

Budget puts a burden on RBI… The central bank is under pressure to step in to keep yields in check after the government surprised bond markets with a bigger-than-expected borrowing plan. That puts the burden on Governor Shaktikanta Das to calm the bond traders when he meets to decide policy on Friday. He’s already had to assuage them that a recent measure to mop up excess liquidity isn’t a step toward changing RBI’s accommodative policy and the central bank has rejected bids at two auctions of benchmark debt after investors sought higher yields.

FPIs get some generous tax relief… The budget has eased taxes on dividends for overseas investors and forthcoming instruments like Real Estate Investment Trusts and Infrastructure Investment Trusts. The proposal to allow FPIs to avail treaty rates for tax deducted at source for dividends is expected to cut the TDS rates for offshore funds by as much as 50%. Until now, FPIs were subject to TDS of up to 22% for dividends earned in India. Now, TDS will be equal to the dividend tax rate proposed in the tax treaty through which the foreign investor enters India. Most of the treaties have a tax rate as low as 10%.

Jewellery set to get cheaper… Gold and silver jewellery will become cheaper in the country ahead of the upcoming wedding season with finance minister Nirmala Sitharaman reducing import duty on gold and silver to 7.5% from 12.5% in the Union budget. Besides bringing relief to the consumers, the move would make Indian jewellery more competitive in global markets and also help reduce gold smuggling into the country, industry insiders said.

Infra financing gets a shot in arm… Five years after India increased the ceiling on overseas ownership in the insurance sector, finance minister Nirmala Sitharaman on Monday heralded bold reforms in a sector considered crucial for underpinning infrastructure financing. She raised the headroom on foreign holding to 74% in one go, potentially multiplying fund-raising avenues in a long-gestation industry that needs as much capital as is available. Her pronounced accent on reforms, evident elsewhere in the budget speech that included the ‘privatisation’ word in the golden-anniversary decade of bank nationalisation, hasn’t sacrificed ‘safeguards’ either.

Major setback for Ulips… Equity mutual funds are expected to benefit from a move in the Union Budget to introduce taxes on investments in unit-linked insurance plans exceeding Rs 2.5 lakh in a financial year. Several rich investors have been pouring money into Ulips — stock market-linked insurance plans similar to equity MFs — since the reintroduction of longterm capital gains tax in equities. Ulips had been exempt from taxes on gains made from the product.

Fridge, AC may get dearer…Increased spending on rural infrastructure, sops for the farm sector and a focus on job creation are expected to help spur demand for daily household products and groceries — a market that has already recovered strongly during the last quarter. However, prices of some consumer electronics products such as refrigerators, air-conditioners and printers and discretionary items including hiking shoes, electronic toys and imported frozen foods could increase marginally due to hike in customs duty on their raw materials.