Morning market quote from Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services
“Market dynamics have become highly complex with an uncertain cocktail of positive & negative factors. The smart rebound in economic activity, sharp decline in crude by 7% overnight, reaffirmation of accommodative monetary stance by the Fed & resumption of FII buying are clear positives. But the second wave of Covid, particularly in the economically crucial state of Maharashtra, the rise in US bond yield above 1.7% and sustained DII selling are negatives. The market direction in the short-term will be decided by either the positive or negative factors gaining traction, going forward. Investors will have to wait & watch”
Opening Bell: Sensex, Nifty open lower for the sixth session as bond yields spike; banks, autos drag
Indian indices opened lower for sixth straight session on Friday following losses in global markets as a spike in bond yields spooked investor sentiment. The yield on the benchmark 10-year Treasury bonds hit 1.71 percent, its highest in almost 14 months. Domestically, all sectors witnessed broad-based selling with banking, financials, and auto dragging the most. At 9:18 am, the Sensex was down 243 points at 48,973 while the Nifty fell 75 points to 14,483. Broader markets were also in the red with the midcap and smallcap indcies down 0.8 percent each. On the Nifty50 index, HCL Tech, Bharti Airtel, HDFC Life, SBI Life, and Dr Reddy’s were the top gainers while ONGC, GAIL, Tata Motors, L&T and Coal India led the losses.
Petrol, diesel prices unchanged for 20th consecutive day
The oil marketing companies (OMCs) kept petrol and diesel rates static for the 20th consecutive day on Friday. Accordingly, petrol prices in Delhi remained unchanged at Rs 91.17 a litre, while diesel prices maintained its price line of Rs 81.47 a litre in the national capital, according to Indian Oil Corporation, the country’s largest fuel retailer. In Mumbai, the petrol price remained unchanged at Rs 97.57 per litre on Monday. The cost of diesel also was the same at Rs 88.60 a litre. The prices of petrol and diesel are reviewed by oil marketing companies such as state-run Indian Oil on a daily basis and any revision is implemented from 6 am in the morning.
TV ad volumes for Jan-Feb 2021 highest since 2017: BARC India
The January-February 2021 period witnessed a revival in TV advertising. Despite a decline in the count of advertisers and brands during Jan-Feb 2021, overall ad volumes registered a 21 percent growth compared to the same period in 2020, according to BARC India’s 2021 advertising report. The total ad volume in Jan-Feb 2021 is at an all-time high since 2017. “Continuing the momentum built in H2 of 2020, TV Ad Volumes have had the most promising start with January & February Ad Volume levels of 2021 being the highest ever in 5 years. A lot of sectors/categories, and key non-FMCG brands, also seem to have increased their presence on TV during this period which augurs well for the medium,” said Aaditya Pathak, Head – Client Partnership and Revenue Function, BARC India. More here
Oil steadies but Europe pandemic outlook knocks demand hopes
Oil prices edged up on Friday, but were still down more than 8% for the week as a new wave of COVID-19 infections across Europe spurred fresh lockdowns and dampened hopes that an anticipated recovery in fuel demand would come soon. Prices plunged 7% on Thursday, falling for a fifth day in a row amid concerns about slowing vaccination programmes in Europe, even if infections have plummeted in the United States, the worst-hit country and biggest crude consumer. U.S. crude was up 10 cents, or 0.2%, at $60.10 a barrel by 0233 GMT. Brent crude was up 18 cents, or 0.3%, at $63.46 a barrel. Several large European countries have reimposed lockdowns as new infections increase, while vaccination programs have slowed because of concerns about side effects of the AstraZeneca vaccine, which was being widely distributed in Europe.
Rising US yields: NASDAQ and India will suffer the most, says Jeff Chowdhry
The US Treasury yields have been on the rise as the prospect of economies emerging from year-long lockdowns have sparked inflation fears. Jeff Chowdhry, Chairman of RLC Ventures on Thursday said that US bond yields are the ultimate barometer of risk around the world and one needs to be extremely cautious as US bond yields continue to rise. Chowdhry believes that NASDAQ and India are the two areas that will suffer the most because of the rising US yields.
“If you think about a global fund manager or an FII fund manager, the two biggest over-owned asset classes in equities at the moment are NASDAQ, US technology stocks, and within emerging markets India. So, if US bond yields are going up, the two areas which are going to suffer the biggest pain of those two growth areas is NASDAQ where we have seen a reduction from the high and it continues to fall, and India. India is an extremely over-owned market by FIIs. I can’t say anything about the domestics and what they will do, but the FIIs will continue to sell this market as US bond yields go up,” he said. More here
US 10-year Treasury bond yields hit 14-month high
The US 10-year Treasury note yield rose to its highest in 14 months on Thursday as investors expect higher inflation as the economic recovery in that country gathers steam. The yield on the benchmark 10-year Treasury bonds hit 1.71 percent, its highest in almost 14 months. The move comes after the US Federal Reserve lifted the inflation and growth forecasts but reiterated its commitment to keep the benchmark interest rates low until at least 2024. The Fed expected inflation to jump to 2.4 percent this year, above its 2 percent target. However, Fed chair Jerome Powell said that it was viewed as a temporary surge that would not change the Fed’s pledge to keep its benchmark overnight interest rate near zero. More here
First up, here is quick catchup of what happened in the markets on Thursday
Indian indices ended a percent lower on Thursday, extending losses for the fifth straight session as bond yields spiked to their 13-month high. Domestically, major selling was seen in the IT, pharma and banking sectors. The Sensex ended 585 points lower at 49,216 while the Nifty lost 163 points to settle at 14,558. US 10-year Treasury yields hit their highest levels in 13-months, climbing above 1.70 percent for the first time since January 24, 2020 after the Federal Reserve’s push back against speculation over interest rate hikes. Back home, broader markets were also lower with the midcap and smallcap indices down over 1 percent each. On the Nifty50 index, ITC, Bajaj Auto, Hindalco, Grasim and Bharti Airtel were the top gainers while HCL Tech, Infosys, Divi’s Labs, Dr Reddy’s and Hero Moto led the losses.
Welcome to CNBC-TV18’s Market Live Blog
Good morning, readers! I am Pranati Deva from the market’s desk of CNBC-TV18. Welcome to our market blog, where we provide rolling live news coverage of the latest events in the stock market, business and economy. We will also get you instant reactions and guests from our stellar lineup of TV guests and in-house editors, researchers, and reporters. If you are an investor, here is wishing you a great trading day. Good luck!