The BSE Sensex and the NSE Nifty are set to start the week on flat to higher note, following mixed cues from Asian peers amid expectations of aggressive policy tightening by the U.S. Federal Reserve in its policy meeting this week. The muted trends on SGX Nifty also indicated a flat opening for the domestic bourses, with SGX Nifty futures trading 24 points, 0.14%, higher at 17,587 levels on the Singapore Stock Exchange at 7:50 AM. In absence of any major development on the domestic front, investors will keep a close eye on the Federal Reserve’s monetary policy outcomes this week, with the U.S. central bank expecting to raise the rate by at least 75 basis points. The foreign institutional investors (FIIs) movements and trends in crude markets will also impact market trade.
Last week, the Indian equity benchmarks settled in negative terrain with more than 1.5% losses as sell-off in global equities as well as concerns about global economic slowdown soared investors’ appetite for riskier assets. The higher-than-expected rise in U.S. inflation and warning of global recession by the World Bank in the backdrop of the continued rise in interest rates by central banks globally, especially the Federal Reserve, left investors jittery. The cut in India’s GDP growth projection by various domestic and global agencies also injected negativity in the market. Six of the top-10 most valued firms suffered a combined loss of over ₹2 lakh crore in market valuation last week, with IT heavyweight TCS and Infosys taking the massive hit. Last week, the 30-share Sensex plunged 1.6% to 58,841 levels, and the 50-share Nifty dropped 1.70% to 17,531. Among the Sensex pack, Reliance Industries, TCS, HDFC Bank, Hindustan Unilever, Infosys and HDFC saw dip in their valuation, while ICICI Bank, State Bank of India, Adani Transmission and Bajaj Finance emerged as net gainers.
Stocks to watch
ACC, Ambuja Cements: The Adani Family, through Endeavour Trade and Investment, a special purpose vehicle, has successfully completed the acquisition of Ambuja Cements and ACC from its parent company, Holcim. The value of the Holcim stake and open offer consideration for Ambuja Cements and ACC is $6.50 billion. Post the transaction, Adani will hold 63.15% in Ambuja Cements and 56.69% in ACC (of which 50.05% is held through Ambuja Cements).
Adani Power: The company has decided to withdraw its delisting offer, citing delay in getting approval from the exchanges. Its shareholders had given a nod for the delisting of the company's shares on the BSE and NSE in July 2020, and had submitted an application for the same to the exchanges in January 2021.
Mahindra and Mahindra (M&M): Mahindra Susten, the renewable energy arm of the Mahindra Group, has sold a 30% stake at an equity value of ₹2,371 crore to Ontario Teachers’ Pension Plan Board. Besides, Mahindra Group and Ontario Teachers’ will also jointly explore the sale of an additional 9.99% stake in Mahindra Susten by May 31, 2023.
Inox Wind: The company’s subsidiary, Inox Green Energy Services, plans to launch Initial Public Offering (IPO) by October this year. The wind power operation and maintenance service provider aims to raise ₹740 crore through public listing of shares to fund its expansion plans.
Vedanta: The site for the mining major’s joint venture semiconductor plant in Gujarat is likely to be finalised in the next couple of weeks. The company has hired experts for evaluating possible sites in Gujarat based on technical, commercial viability and connectivity aspects.
HDFC Life Insurance: The private insurer in an exchange filing said the Mumbai bench of National Company Law Tribunal (NCLT) has approved the merger of Exide Life Insurance with the company. Earlier this year, HDFC Life had announced acquisition of 100% stake in Exide Life from its parent Exide Industries for ₹6,687 crore.
Zomato: The food aggregator has launched its new offering Healthy to offer more healthy food options to its customers. The new services will be initially offered in ten cities across India, including Delhi, Mumbai, Bangalore, Hyderabad, Chandigarh, Pune, Chennai, Jaipur, Ahmedabad and Kolkata, Deepinder Goyal, founder and CEO, said in a blog.
Paytm: The Enforcement Directorate has seized funds worth ₹46.67 crore lying in various bank accounts of payment gateways Easebuzz, Razorpay, Cashfree, and Paytm. As per the probe agency, ₹33.36 crore was found with Easebuzz Private Limited, ₹8.21 crore with Razorpay Software Private Limited, ₹1.28 crore with Cashfree Payments India Private Limited and ₹1.11 crore with Paytm Payments Services Limited.
Sunteck Realty: The real estate company has received green building pre-certification for its ongoing projects from Edge-IFC. It has secured certificates for its four residential projects - Sunteck Beach Residences (SBR) Vasai; 4th Avenue SunteckCity, Oshiwara District Centre (ODC) Goregaon (W); Sunteck MaxXworld and Sunteck ONEWorld at Naigaon by EDGE-IFC.
NSE F&O ban: Indiabulls Housing Finance, India Cements, PVR, and RBL Bank will be under the NSE F&O ban today.
Here are the key things investors should know before the market opens today:
Wall Street falls on FedEx warning
On Friday, all three major U.S. indices closed lower on Wall Street, registering one of its biggest single-day losses in the last two months, as concerns about a global economic slowdown as well as FedEx’s warnings about earnings outlook spooked investors’ sentiments. The Dow Jones Industrial Average settled 0.46% lower, the S&P 500 dropped 0.69%, and the Nasdaq Composite tumbled 0.9%.
Shares of package delivery giant FedEx plunged 21% percent after it lowered its earnings forecast for the current quarter, citing a slump in global demand. FedEx’s move further dampened market sentiment, which was rattled by comments from the World Bank, which warned of a potential global economic slowdown due to the continued rise in interest rates globally. In the backdrop of a higher-than-expected inflation report (CPI) in August, the Federal Reserve is expected to raise the interest rate by at least 75 basis points at its policy meeting later this week.
Asian shares edge lower
Shares in the Asia-Pacific region started the week on a weak note, following a sharp sell-off on Wall Street on Friday as concerns about an aggressive rate hike by the U.S. Federal Reserve and a cut in earnings outlook by delivery major FedEx dented market sentiments.
The Hang Seng index in Hong Kong fell 0.5%, South Korea’s Kospi shed 0.6%, and Australia's ASX 200 was trading flat.
The Straits Times in Singapore was marginally higher, while the Taiwan Weighted index dipped 0.2%.
Markets in mainland China were trading mixed, with the Shanghai Composite rising by 0.25%, while the Shenzhen Component fell by 0.2%.
FPIs invest ₹12,000 crore in Sept so far
Foreign investors have injected ₹12,000 crore into the Indian equity market so far this month amid optimism that the U.S. central bank may go slow on rate hikes as inflation starts to cool off. In the previous month, foreign portfolio investments (FPIs) had touched a record high of ₹51,200 crore, from ₹5,000 crore in July, after net fund outflows of a massive ₹2.46 lakh crore between October 2021 till June 2022.
However, going ahead, the FPIs flows are expected to remain volatile this week due to expected jumbo rate hike by the U.S. Fed to tame inflation.
FIIs, DIIs turn net sellers
Foreign institutional investors (FIIs) and domestic institutional investors (DIIs) emerged as net sellers in the Indian equity market on September 16. As per the exchange data, FIIs net sold shares worth ₹3,260.05 crore, while DIIs net offloaded stocks worth ₹36.57 crore.
Crude prices rise
The crude oil climbed more than 1% during early Asian trade on Monday as weak dollar and supply concerns pushed prices higher. However, persistent concerns about fuel demand outlook in the backdrop of slowdown in global economy limited upmove.
In Asian trading hours on Monday, the Brent oil for November delivery climbed 0.8% to $92.3 per barrel, while the U.S. West Texas Intermediate (WTI) crude October futures rose 0.96% to $85.58 a barrel.