Indian Equity Summary-
·
The
domestic equity market benchmark indices ended mildly in red on the back of
weak global cues. The small cap and the midcap indices bucked the trend and
managed to close in green ~1.5% thus exhibiting an overall strength of the
market and broad based buying. The uncertainty surrounding the additional
stimulus package and the caution ahead of the weekend meeting between the US
and China added to the cautious market sentiment. Upbeat economic data from the
US and China, and positive reports from Russia on registering Covid-19 vaccine
will act as tailwinds for the markets going forward.
·
Going
forward, global factors like development on the US -China relationship front ,
and domestic factors like the monsoon trajectory and remaining earnings season
; will continue to dictate the trend of the domestic equity market. We expect
the trading range for Nifty between 10900-11,400 in the near term.
Indian Debt
Market-
·
Government
bond prices fell as the yield of the 10-year benchmark 5.79% 2030 paper settled
at 5.97% on August 14 compared with 5.89% on August 7 , while the yield of the
10-year 5.77% 2030 paper settled at 5.95% on August 14 compared with 5.84% on
August 7.
·
India’s
industrial production (IIP) contracted 16.6% in June as against 33.9%
contraction in May while India’s retail inflation spiked to 6.93% in July on
account of higher food prices; retail inflation for June was also revised to
6.23%.
·
We
expect the 10 year benchmark yield to trade between 5.80-6.05% in near term.
Domestic
News
·
Prime
Minister Narendra Modi launched a financing facility of Rs 1 lakh crore under
the Agriculture Infrastructure Fund. He also unveiled the Transparent Taxation
platform to benefit honest taxpayers. Further, he released Rs 17,000 crore
directly into bank accounts of 85 million farmers under the PM Kisan scheme.
·
India’s
Consumer price inflation rose unexpectedly to 6.93 percent in July from 6.23
percent in June. Economists had forecast the rate to ease to 6.15 percent.
Foodpriceinflationacceleratedto9.62percentfrom8.72percentamonthago.
·
Prime
Minister Narendra Modi’s assurance on mass production of COVID-19 vaccines and
more infrastructure spending by the government boosted market sentiment.
International
News
·
China’s
Industrial production grew 4.8 percent on a yearly basis in July, the same rate
of growth as seen in June .
·
The
US non-farm payrolls jumped by 1.8 million jobs in July after surging by 4.8
million jobs in the previous month; the unemployment rate dropped to 10.2% in
July from 11.1% in June.
·
Producer
prices in Japan were up 0.6 percent on month in July. That exceeded
expectations for an increase of 0.3 percent following the 0.6 percent increase
in June.
·
The
UK gross domestic product (GDP) contracted by 20.4% sequentially in the second
quarter, following a 2.2% drop in the first quarter.
Disclaimer :
The
information and views presented here are prepared by Karvy Private Wealth (a division of Karvy Stock Broking Limited) or other Karvy Group
companies. The information contained herein is based upon sources that we
consider reliable. We, however, do not vouch for the accuracy or the
completeness thereof. This material is for personal information and we are not
responsible for any loss incurred based upon it. Karvy Private Wealth is only a
distributor of securities and financial market products.
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