Indian equity benchmarks are likely to start the week on a soft note, following mixed cues from Asian peers amid talks of fresh sanctions against Russia over its invasion of Ukraine. The weak trends on SGX Nifty also indicated a soft opening for the domestic bourses, with SGX Nifty futures trading 36 points, or 0.21%, lower at 17,706 on the Singapore Stock Exchange at 8:25 AM.
This week, the Reserve Bank’s monetary policy, domestic macroeconomic data, developments in the Russia-Ukraine conflict, and trends in crude oil would be key factors that will set the tone for the Indian share market.
Last week, the Indian benchmark indices ended on a positive note, thanks to the ease in crude oil prices and funds buying by foreign institutional investors (FIIs). During the week ended April 1, the BSE Sensex gained 1,914.49 points, or 3.33%, to settle at 59,276, while the Nifty50 rose 517.45 points, 3.01%, to end at 17,670 levels. India’s volatility index VIX dropped sharply by over 21% to 18.43%, supported by peace talks between Russia and Ukraine to end the war.
Stocks to focus
Infosys: The IT major is reportedly shifting its services from Russia to its other global delivery centres. The development comes in the backdrop of mounting pressure on the U.K. Chancellor Rishi Sunak, who was questioned lately over the Russian presence of Infosys, a company in which his wife, Akshata Murty, owns shares.
Auto stocks: Shares of automobile companies will be in focus as most of the index heavyweights will unveil their monthly sales numbers.
Tata Motors: The auto major along with its dealer partners has delivered 712 electric vehicles on Saturday to individual customers in Maharashtra and Goa. The order includes 564 Nexon electric vehicles (EVs) and 148 Tigor EVs.
NMDC: The country’s largest iron ore producer has reported 23% year-on-year growth in production to 42.15 million tonnes (MT) in the financial year ended March 31, 2022. The state-owned miner’s sales rose 22% to 40.70 MT during fiscal 2021-22.
TVS Motor Company: The two-wheeler posted sales of 307,954 units in March 2022 as against sales of 322,643 units in the month of March 2021. Motorcycle registered sales grew from 157,254 units, while scooter sales stood at 94,747 units in March 2022.
One97 Communications (Paytm): The shareholders of the fintech major last week approved the company’s related party transactions (RPTs) with Paytm Payments Bank (PPB).
Maruti Suzuki India: The country’s largest carmaker reportedly targets to sell 4-6 lakh CNG units in the current fiscal year depending upon supply situation of essential components. In FY22, the auto major sold about 2.3 lakh CNG units.
ONGC, Reliance Industries: The government has raised the gas price paid to producers of oil and regulated fields from $2.9 per million British thermal units to $6.10, a record high, effective from April 1. This rise in gas price would boost state-owned ONGC’s earnings by $3 billion (about ₹23,000 crore), while Reliance Industries may get an additional $1.5 billion (₹11,500 crore) in revenue.
Here are the key things investors should know before the market opens today:
Wall Street ends higher on Friday
All three major U.S. indices closed higher on Friday as investors cheered strong monthly jobs reports which painted a rosy picture of an economic growth. However, firm labor market data would prompt the Federal Reserve to maintain its hawkish policy stance. Data released on Friday showed US employers added 431,000 jobs in March and the unemployment rate dropped to 3.6% during the month under review. The Dow Jones Industrial Average rose 0.4%, while the S&P 500 and the Nasdaq Composite ended with a 0.3% gain each. Investors will also keep a close eye on Wednesday’s minutes of the Federal Reserve’s March meeting to have more clarity on the policy outlook.
Asian stocks mixed in early trade
Shares in the Asia-Pacific region witnessed mixed trading in early deals on Monday, tracking soft cues from Wall Street. The report of fresh sanctions against Russia in response to its invasion of Ukraine weighed on market sentiments, while stocks witnessed thin trade due to a holiday in China.
Regional heavyweight Japan’s benchmark index Nikkei 225 traded lower by 0.14%, Taiwan’s Weighted index slipped 0.4%, and Indonesia’s Jakarta Composite fell 0.15%. The Straits Times Index in Singapore traded flat with a negative bias.
Bucking the trend, the Hang Seng index in Hong Kong rallied 1.2%, South Korea’s KOSPI gained 0.28%, and Australia’s ASX 200 index rose 0.3%.
Oil prices drop 13% last week
The prices of Brent and U.S. crude oil slumped 13% last week, registering their highest weekly declines in two years, the International Energy Agency (IEA) agreed to support President Joe Biden’s decision to release the largest-ever U.S. oil reserves to ease international crude prices. Last week, the U.S. government announced the release of 1 million barrels per day of oil for six months from May, which is being seen as the largest ever release from the U.S. Strategic Petroleum Reserve.
In the Asian trading hours on Monday, the U.S. WTI crude futures were down 0.13% to $99.14 a barrel, while the Brent oil futures dropped 0.28% to $104.08 per barrel.
Meanwhile, Indian oil companies have again hiked petrol and diesel prices by 40 paise a litre, taking the overall increase in the last two weeks to ₹8.40. This was the 12th hike in fuel rates by the fuel retailers in two weeks in the backdrop of recent hike in the international crude oil market.
FIIs, DIIs turn net buyers
The foreign institutional investors (FIIs) and domestic institutional investors (DIIs) turned net buyers in the Indian equity market last week. As per the exchange data, FIIs purchased shares worth ₹5,590 crore last week, while DIIs net brought shares worth ₹5,052.5 crore.