Domestic Benchmark Indices Set for Weak Opening as Asian Stocks Plummet
The domestic benchmark indices appear poised for a lackluster start on Wednesday, mirroring sustained selling pressure witnessed in global equity markets. Asian stocks have tumbled to their lowest point in 11 months, following significant declines in US stocks overnight. Indian traders are eagerly awaiting the Reserve Bank of India’s (RBI) upcoming monetary policy announcement and are beginning to form expectations for the forthcoming Q2 earnings season. Here are the key highlights to be aware of before the Opening Bell:
Nifty Outlook: According to Rupak De, Senior Technical Analyst at LKP Securities, Nifty has found support at the ascending trendline on the daily chart. However, the sentiment appears bearish in the short term. The level of 19,480 is expected to serve as a critical “make or break” point. A decisive drop below 19,480 could trigger substantial selling in the market, while 19,600 continues to be a significant resistance level on the upside.
GIFT Nifty Signals a Negative Start: Nifty futures on the NSE International Exchange traded 15 points, or 0.08 percent, lower at 19,435.50, hinting at a negative start for the domestic market on Wednesday.
Asian Stocks at 11-Month Low: Asian stocks have plummeted to their lowest level in 11 months due to robust US economic data pushing Treasury yields to new highs. The MSCI’s broadest index of Asia-Pacific shares, excluding Japan, declined by 1.05 percent. Key Asian markets experienced significant declines: Japan’s Nikkei dropped by 1.91 percent, Australia’s ASX 200 declined by 0.77 percent, New Zealand’s DJ fell by 0.71 percent, China’s Shanghai inched up by 0.10 percent, Hong Kong’s Hang Seng tumbled by 0.78 percent, and South Korea’s Kospi crashed by 2.14 percent.
Oil Prices Rise on Tight Supply: Oil prices have risen in early Asian trade, supported by tightening global crude supply ahead of an OPEC+ panel meeting. OPEC+ is expected to maintain its current output policy. Brent crude oil futures increased by 6 cents to reach $90.98 a barrel, while US West Texas Intermediate crude (WTI) rose by 11 cents to $89.34 per barrel.
Dollar Strengthens on Positive Data: The US dollar surged following upbeat data revealing an unexpected increase in US job openings in August. This data reflected a surge in demand for workers in the professional and business services sector. The Japanese yen was marginally lower at 149.17 per dollar, and the dollar index was last at 107.07. Sterling edged 0.02 percent lower to $1.2076, while the euro reached $1.0470.
US Stocks Settle Lower: US stock markets witnessed a downturn, with the S&P 500, Dow Jones, and Nasdaq all closing at their lowest levels since May and June. Economic data indicated the possibility of the Federal Reserve maintaining high-interest rates. The Dow Jones Industrial Average fell by 430.97 points, or 1.29 percent, to 33,002.38, the S&P 500 lost 58.94 points, or 1.37 percent, at 4,229.45, and the Nasdaq Composite dropped 248.31 points, or 1.87 percent, to 13,059.47.
Updater Services Lists Today: Updater Services (UDS) will make its debut on Dalal Street today. The company offered its shares in the price range of Rs 280-300 per share, with a lot size of 50 equity shares and its multiples, aiming to raise a total of Rs 640 crore. The subscription period for the issue was from September 25 to September 27.
Stocks in F&O Ban List: The National Stock Exchange (NSE) has placed only one stock, Indiabulls Housing Finance, in the F&O segment ban list for Wednesday, October 4. Companies with derivative contracts exceeding 95 percent of the market-wide position limit are included in the F&O ban list.
FPIs Sell Shares Worth Rs 2,034 Crore: Provisional data from the National Stock Exchange (NSE) indicates that Foreign Portfolio Investors (FPIs) were net sellers of domestic stocks worth Rs 2,034.14 crore on Tuesday. In contrast, Domestic Institutional Investors (DIIs) were net buyers of Indian equities worth Rs 1,361.02 crore.
Rupee Falls 14 Paise Against Dollar: The Indian rupee depreciated by 14 paise to close at 83.20 against the US dollar on Tuesday. This decline was attributed to a strong US dollar and weak domestic equities, which negatively impacted investor sentiment. Forex traders also noted muted domestic macroeconomic data and sustained Foreign Institutional Investor (FII) outflows, which added downward pressure on the rupee.
Please note that this information includes inputs from PTI, Reuters, and other agencies.