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Market Movers: What changed for D-Street while you were sleeping

Wall Street's main stock indexes ended slightly lower on Tuesday, though not far from record highs.

ETMarkets.com|
Dec 11, 2019, 08.06 AM IST
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The 50-share index ended the day at 11,856, even as the price chart formed a Big Black Body that engulfed the small body of the previous session.
NEW DELHI: Indian benchmark equity indices are looking for another flat opening taking cues from Asian markets and Nifty futures trading in Singapore. Investors are uncertain on whether the US will defer the proposed December 15 round of tariffs on Chinese goods.

Here’s breaking down the pre-market actions


TRADE SETUP

Singapore trading sets stage for flat start
Nifty futures on the Singapore Exchange traded 8.5 points, or 0.07 per cent, up at 11,915.50, indicating a flat start for Dalal Street.

Tech view: Nifty forms bearish candle
The 50-share index ended the day at 11,856, even as the price chart formed a Big Black Body that engulfed the small body of the previous session. “The near-term upward momentum is fading out, and a phase of correction or consolidation is setting in,” said Manav Chopra, CMT, Head Research - Equity, Indiabulls Ventures.

Asian shares flat
Asian stocks flatlined on Wednesday as Sino-US trade talks approached a weekend deadline with little sign of progress, while a tightening of the UK election race knocked the pound. Investors are beginning to suspect that even if US tariffs due to take effect on Sunday are delayed, it may be 2020 before Washington and Beijing can agree a broader rapprochement.

US stocks close lower
Wall Street's main stock indexes ended slightly lower on Tuesday, though not far from record highs. The Dow Jones Industrial Average fell 27.88 points, or 0.1 per cent, to 27,881.72, the S&P 500 lost 3.44 points, or 0.11 per cent, to 3,132.52 and the Nasdaq Composite dropped 5.64 points, or 0.07 per cent, to 8,616.18.

FIIs sell Rs 367 crore worth stocks
Net-net, foreign portfolio investors (FPIs) were sellers of domestic stocks to the tune of Rs 366.79 crore on Tuesday, data available with NSE suggested. DIIs were net buyers to the tune of Rs 338.4 crore, data suggests.

US Fed outcome
The Fed is set to share the statement of their December policy meeting later in the day, followed by Fed Chair Jerome Powell's news conference where investors will look for cues about the health of US economy. Powell has taken a glass-half-full view of the U.S. economy but the trouble may be that the glass has gotten smaller and has a few cracks.

Crude prices slip
Oil prices fell on Wednesday after industry data showed a surprise build in crude oil inventory in the United States. Brent futures fell by 37 cents, or 0.6 per cent, to $63.97 per barrel by 0121 GMT. US West Texas Intermediate crude slipped by 30 cents, or 0.5 per cent, to $58.94 a barrel.


MONEY MARKET

Rupee: The rupee rose by 12 paise to close at a more than one-month high of 70.92 against the US dollar on Tuesday amid softening crude oil prices and weakening of the greenback vis-a-vis major global currencies.

10-year bonds: India 10-year bond yields rose 0.04% to 6.71% on Tuesday, against 6.67% in the previous session, according to Bloomberg.

Call Rate: The overnight call money rate weighted average was 5.01% on Tuesday, according to RBI data. It moved in a range of 3.70-5.25%.

MACROS

China sees US postponing its Dec 15 tariff threat
Chinese officials expect President Donald Trump to delay a threatened tariff increase set for Sunday, giving more time to negotiate an interim trade deal that both sides continue to insist is close to fruition despite a series of missed deadlines, reports Bloomberg. Beijing sees the removal of the 15 December threat enabling talks to continue on the unfinished items in phase-one of the accord, two officials said on condition on anonymity because the conversations are private.

India’s retail loan growth could be lower: Crisil
Banks’ Retail loan growth numbers may be misleading. Bulk of the lending figures since the IL&FS crisis reflects the lending for purchase of NBFCs securitised retail loan pool, a report by ratings firm Crisil said. “After deducting securitisation flows, retail loans growth shows a fall from 16% in fiscal 2018 to around 12% in 2019 and first half of this fiscal” Crisil said. This is also the slowest growth in the last five years. Crisil arrived at the figure after it filtered lending-for-securitisation data from the retail credit data.

Auto sales continue to fall in Nov
After showing a brief pick-up during the festive season, sales of passenger vehicles, trucks, motorcycles and scooters have again tapered off in November, with sluggishness in the broader economy, stringent financing norms and the industry’s impending transition to BS VI emission standards impacting demand. Automakers dispatched 263,773 passenger vehicles to dealers last month, a decline of 0.84%, shows data available with industry body Society of Indian Automobile Manufacturers. Passenger car sales in the local market dropped by 10.83% (to 160,306 units) in the period under review, but strong demand for utility vehicles lifted overall volumes. Sales of utility vehicles rose 32.70% to 92,739 units in November.

RBI finds Rs 11,932 cr hole in SBI's NPA book
State Bank of India (SBI) on Tuesday said that a Reserve Bank of India audit found out it had under-reported gross non-performing assets to the tune of Rs 11,932 crore for fiscal year 2019. In a regulatory filing on Tuesday, the state-run lender said the central bank also found that the divergence in provisioning for these bad loans stood at Rs 12,036 crore. As per the assessment done by the RBI, the gross NPAs of SBI was Rs 11,932 crore more at Rs 1,84,682 crore as against Rs 1,72,750 crore reported by the bank for 2018-19, SBI said in a regulatory filing.

Silver lining for India at WTO
Global trade dispute settlement will come to a standstill from Wednesday with the Appellate Body of the World Trade Organization (WTO) becoming dysfunctional as the number of judges on the body falls below the minimum threshold of three. The US has blocked the appointment of judges for more than two years, crippling the multilateral trade agency’s dispute settlement mechanism. However, this may have a silver lining for India in the short term as it gives New Delhi the option to continue with its key export subsidy schemes, including the one for special economic zones which it appealed last month after losing the case to the US.

Employability of graduates jumps to nearly 50% in 2019
A survey has found that nearly half of the fresh graduates are employable now. The survey, however, does not speak about the jobs scenario given the shape of the economy due to the high capacity underutilization prevalent in across most industry segments for many years now. According to the India Skills Report by Wheebox, People Strong and CII, there is an overall positive trend in talent supply as over 46% of the students surveyed are found to be employable in 2019 against only 33% in 2014. The most employable candidates are MBAs with 54% being found employable against 40% two years ago

Cos can recover exploration costs from new finds
Vedanta, Reliance Industries and other oil companies can fully recover exploration cost incurred after the expiry of the so-called exploration period, according to an oil ministry clarification, which also said such cost – currently about $650 million for Vedanta and $250 million for RIL – will have to be recovered from new discoveries alone, and not from the revenues of the older, producing ones.
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