Indian equity benchmarks are set to open with heavy losses on Monday after Asian stocks nosedived, by 4% in Hong Kong and Japan, amid economic uncertainty triggered by the Russia-Ukraine conflict and rising crude oil prices. High risk aversion in the market due to sustained rally in commodity prices and continued sell-off by foreign portfolio investors may also keep investors on edge. The negative trends on SGX Nifty also indicated a gap-down opening for the domestic bourses, with SGX Nifty futures trading 420 points, or 2.58%, lower at 15,824 on the Singapore Stock Exchange at 7:55 AM.
On Friday, the domestic bourses continued their losing streak for the third straight session as investors' sentiments were dented by reports of Russian strikes at Europe's largest nuclear plant in Ukraine. The 30-share Sensex opened lower and declined as much as 1,215 points intraday, before closing 769 points, or 1.4%, down at 54,334. The Nifty 50 index hit an intraday low of 16,134 but reversed losses to settle at 16,243, down 255 points or 1.5%. The market saw broad-based selling with all sectoral indices closing in red. Auto and metal indices were among the worst performers, while IT and technology sectors declined the least. The top five losers on the BSE Sensex were Titan Company, Maruti Suzuki India, Asian Paints, Mahindra & Mahindra and Hindustan Unilever Ltd. (HUL).
Stocks to focus
Coal India: The country’s largest coal miner’s supplies to the power sector hit a record high of 493 million tonnes (mt) during the current financial year, breaching the previous high of 491.5 mt seen in FY19. The surge in coal prices amid sanctions on Russia is also likely to impact positively to the state-run company.
State Bank of India (SBI): The country’s largest lender has appointed former Ujjivan Small Finance Bank CEO Nitin Chugh as Deputy Managing Director (DMD) to boost digital banking operations.
Vodafone Idea: The promoters of the telecom company have amended the shareholder's pact to secure their governing rights with the proposed issuance of equity to the central government. The company will hold an Extraordinary General Meeting (EGM) on March 26.
3i Infotech: The company has secured a contract worth ₹12.85 crore from Rajasthan State Pollution Control Board (RSPCB) for the design, development, implementation, and maintenance of an integrated e-governance solution for the Rajasthan State Pollution Control Board.
Wipro: Designit, a Wipro-owned company, has announced the appointment of Nicolas (Nic) Parmaksizian as chief executive officer.
Nazara Technologies: Ace investor Rakesh Jhunjhunwala-backed mobile gaming company said its board has approved the issuance of equity shares worth ₹25 crore to existing shareholders of Datawrkz Business Solutions. These shares will be issued on a preferential basis, at a price of ₹2,260 per share.
V-Mart Retail: SBI Funds Management through various schemes has acquired an additional 4.5% stake in the apparel retailer through open market transactions on March 3. With this, SBI Funds Management stake in the company rose to 8.76%.
Balkrishna Industries: The tyre manufacturer has begun commercial production of the brownfield expansion and de-bottlenecking project at its Bhuj plant ahead of schedule.
Tube Investments of India: The Murugappa Group company said that its subsidiary, TI Clean Mobility, has purchased a 70% stake in Cellestial E-Mobility.
Here are the key things investors should know before the market opens today:
Wall Street ends lower amid Ukraine concerns
On Friday, all the three major U.S. indices ended lower as concerns about war in Ukraine overshadowed a boost in the U.S. jobs market. The market sentiments were dented amid a report that Russian troops took control of Europe's biggest nuclear power plant. Meanwhile, data by the Labour Department showed jobs grew by 678,000 last month and the unemployment rate dropped to 3.8%, the lowest since February 2020. The Dow Jones Industrial Average slipped 0.53%, the S&P 500 shed 0.79%, and the Nasdaq Composite tumbled 1.66%.
Asian stocks slump in opening deals
Shares in the Asia-Pacific region plunged in early trade on Monday as the war between Russia and Ukraine continues to dent investor sentiment. The continued surge in commodity prices, including crude oil, and hawkish policy stance by the U.S. Federal Reserve also dragged the markets lower.
Japan’s benchmark index Nikkei 225 nosedived 3.6%, South Korea’s KOSPI tumbled 2.5%, and the Straits Times Index in Singapore slipped 0.55%.
The Hang Seng index in Hong Kong was the worst performer in the region with a 4.1% loss, while Australia’s ASX 200 index fell 1.4%.
In mainland China, the Shenzhen component slumped 1.9%, while the Shanghai Composite shed 1.4% in early deals.
Brent crude tops $130 on supply concerns
The oil prices continued their uptrend, with Brent crude futures crossing $130 a barrel mark on Monday amid a report that the U.S. and its allies are considering banning Russian oil and natural gas imports. Crude oil prices have been rising since Russia invaded Ukraine amid fears that sanctions on Russia, one of the major oil producers, would further tighten fuel supply. Russia accounts for a third of Europe’s natural gas supply and 10% of global oil production. About one-third of Russia’s gas supplies to Europe usually travel through pipelines crossing Ukraine.
During the early Asian trading hours on Monday, the U.S. West Texas Intermediate (WTI) crude futures were up 7.35% to $124.17 a barrel, while the Brent oil futures spiked 8.6% to $128.18 per barrel.
FPIs pull out ₹17,537 crore from Indian markets
Foreign portfolio investors (FPIs) flushed out ₹17,537 crore from the Indian markets in just three trading sessions of March amid political uncertainty and spike in crude prices triggered by Russia-Ukraine war. As per the exchange data, FPIs pulled out ₹14,721 crore from equities, ₹2,808 crore from debt segment and ₹9 crore from hybrid instruments during this period.
As per the data available on the NSE, foreign institutional investors (FIIs) remained net sellers in the Indian equity market on March 4, while domestic institutional investors (DIIs) were net buyers. FIIs sold shares worth ₹7,631 crore, while DIIs net purchased shares worth ₹4,739 crore.