The benchmark Sensex and Nifty indices are likely to open marginally lower on October 9 as trends in the GIFT Nifty indicate a negative start for the broader index with a loss of 87.5 points.
On October 6, the day of the Monetary Policy Committee (MPC) review outcome, where the rate-setting panel chose to maintain a status quo on the key policy rates with a clear focus on arresting inflation within the 4 percent target, the BSE Sensex jumped 364 points to 65,996, while the Nifty50 climbed 108 points to 19,654 and formed a bullish candlestick pattern with minor upper and lower shadows on the daily charts.
"On the daily charts, we can see that the Nifty has managed to close above the 40-day moving average (19,610), which is a bullish sign. On the weekly charts, we can observe that the Nifty has closed in the green and, in terms of pattern, it formed a dragonfly doji, which has bullish implications," Jatin Gedia, technical research analyst at Sharekhan by BNP Paribas, said.
The pivot point calculator indicates that the Nifty may be taking support at 19,607, followed by 19,586 and 19,553. On the higher side, 19,673 can be an immediate resistance, followed by 19,693 and 19,726.
Stay tuned to Moneycontrol to find out what happens in the currency and equity markets today. We have collated a list of important headlines across news platforms, which could impact Indian as well as international markets.
GIFT Nifty
The GIFT Nifty indicates a marginally negative start for the broader index with a loss of 87.5 points. GIFT Nifty futures stood at 19,682 points after making a high of 19,698 points.
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US Markets
Stock futures were lower on Sunday as the attack on Israel by Palestinian militants adds geopolitical risk to an already fragile market dealing with inflation and surging interest rates. Futures tied to the Dow Jones Industrial Average fell 207 points, or 0.6 percent. S&P 500 futures fell 0.7 percent, while Nasdaq 100 futures slipped 0.6 percent.
The Israeli-Palestinian conflict escalated to a full-blown war on Saturday after the militant group Hamas staged an invasion, to which Israel was seemingly caught off-guard. Israeli Prime Minister Benjamin Netanyahu asserted that Hamas “will pay a price it has never known before”.
On Friday, stocks rallied after the release of stronger-than-expected US jobs data and a pop in Treasury yields. The Dow Jones Industrial Average gained 288.01 points, or 0.87 percent, to close at 33,407.58. The S&P 500 added 1.18 percent at 4,308.50. The tech-heavy Nasdaq Composite rose 1.60 percent, closing at 13,431.34. The US economy added 336,000 jobs in September, the US Labor Department said. Economists polled by Dow Jones expected 170,000 jobs. To be sure, wages rose less than expected last month.
European Markets
European stocks finished higher on Friday, despite an earlier dip, as market participants reacted to stronger-than-expected US jobs data. The pan-European Stoxx 600 index closed up 0.8 percent, managing to shake off a brief fall due to the US labour report. Retail stocks led the gains with a rise of 2.2 percent.
Nonfarm payrolls in the US increased by 336,000 in September, surpassing the Dow Jones consensus estimate for 170,000, the Labor Department said in a much-anticipated report. The unemployment rate was 3.8 percent, marginally higher than the forecast.
Asian Markets
The Asia-Pacific markets are set for a positive start to the week as Chinese markets come back from the Golden Week holidays. Investors will be watching inflation readings and trade data out from China and India later this week, as well as a monetary policy decision from Singapore’s central bank.
Japan and South Korea’s markets are closed Monday for a holiday. In Australia, the S&P/ASX 200 was up 0.61 percent in early trading. This comes after the index notched a five-day losing streak and fell below the 7,000 mark for the first time since March on Friday.
Futures for Hong Kong’s Hang Seng index stood at 17,724, pointing to a stronger open compared to the HSI’s last close of 17,485.98. Hong Kong however, has raised its typhoon warning to Signal 8 for Typhoon Koinu, which would cancel the morning session if it is not lifted before 9 a.m. local time. The Hong Kong observatory said that with “departing winds,” it expects to downgrade the Signal 8 warning at 11:40 a.m.
Key events this week: Inflation data, major IT companies' Q2 earnings, Fed Meeting Minutes and more
The week beginning October 9 is packed with important national and global macroeconomic data releases that could potentially impact the financial markets. In India, CPI inflation (October 12) and WPI inflation (October 13) readings for the month of September will be released this week. In addition, India's trade exports, imports, and trade deficit data (October 13) will also be released.
There will be one Initial Public Offering (IPO) launch, and 14 stocks will get listed to make their Dalal Street debut.
Tata Consultancy Services (TCS) will kickstart the earnings season for India Inc by releasing its July-September quarter (Q2) results on October 11. The IT major will also consider buy back of equity shares on the same day. The results for the second quarter of FY24 will be announced in India by TCS (October 11), Infosys, HCL Tech, HDFC AMC, Tata Metaliks (October 12), Den Networks, Hathway, HDFC Life, Aditya Birla Money (October 13), D'Mart, Dalmia Bharat (October 14), and HDFC Bank (October 15).
No petrol, diesel price hike likely despite crude oil price surge as elections loom: Moody's
Petrol and diesel prices are unlikely to be increased despite firming raw material costs because of upcoming general elections next year, Moody's Investors Service said. Three state-owned fuel retailers — Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL) — which control roughly 90 percent of the market, have kept petrol and diesel prices on freeze for a record 18 months in a row.
This is despite the raw material (crude oil) cost surging last year, leading to heavy losses in first half of 2022-23 fiscal year before easing oil prices propelled them to profitability. International oil prices have firmed up since August, leading to margins of three retailers turning negative again.
As Israel war rages, oil traders are focused on Iran
As oil traders prepare for the market to open after the sudden eruption of war in Israel, one question is key: will the conflict spread to the rest of the region?
Crude traders don’t expect a massive price surge as there’s no immediate threat to supply. But all eyes are in Iran, a major oil producer and key backer of the Hamas group that launched this weekend’s offensive in Israel. A retaliatory strike against the Islamic Republic would inflame fears over the Strait of Hormuz, the vital shipping artery which Tehran has previously threatened to shutter. There’s also the prospect of the US cracking down again on a resurgent flow of Iranian oil exports.
The “oil-disruption scenario”, according to Bob McNally, president of Rapidan Energy Group and a former White House official, “would be if conflict spread to Iran.” For now, that looks unlikely, he said.
Exclusive: Govt approves 12 Executive Director appointments at public sector banks
The Union government on October 7 approved the appointment of 12 Executive Directors (EDs) positions in public sector banks. Notably, in July 2023, the Financial Services Institutions Bureau (FSIB) had recommended 16 candidates for the position of executive directors (EDs) in public sector banks (PSBs).
Sanjay Rudra, who is general manager at Bank of Maharashtra, will take charge as the executive director of Union Bank of India with effect from the date of assumption of office, according to a DOPT notification. Moneycontrol has access to the document. However, Lal Singh, chief general manager at Union Bank of India, has been appointed as executive director of Bank of Baroda for a period of three years with effect from the date of assumption of office, according to that notification.
MCX gets approval from SEBI tech panel to launch new commodity derivatives platform
Multi Commodity Exchange of India (MCX) on October 8 said that it has received the approval from SEBI tech panel to launch a web-based commodity derivatives platform (CPD) after several delays with the market regulator earlier.
"Subsequently, SEBI Technical Advisory Committee has recommended that MCX and MCXCCL may Go-Live with the CDP and to intimate SEBI regarding the proposed date for Go Live," MCX said in a regulatory filing. This development was first reported by CNBC-TV18 on October 6 citing sources.
Over the past month, the stock of the Mumbai-based commodity exchange has jumped 18 percent against a 1.4 percent rise in the benchmark Sensex. On October 6, the scrip was up 5.06 percent to close at Rs 2,047.95 apiece.
Oil Prices
Oil prices rose on Friday but remained posted their steepest weekly losses since March, after another partial lifting of Russia’s fuel export ban compounded demand fears due to macroeconomic headwinds. On Friday, Brent futures settled up 51 cents at $84.58 per barrel. U.S. West Texas Intermediate crude futures settled up 48 cents at $82.79.
For the week, Brent posted a decline of about 11 percent and WTI recorded an over 8 percent drop, on worries that persistently high interest rates will slow global growth and hammer fuel demand, even if supplies are depressed by Saudi Arabia and Russia, who said they will continue supply cuts to year end. U.S. job growth rose by 336,000 in September according to Labor Department statistics, far exceeding economists’ forecasts of a 170,000 rise.
Dollar Index
The Dollar index traded 0.22 percent lower in futures at 106.10, whereas the value of one dollar hovered near Rs 83.12.
Gold Prices
Gold prices gained on Friday, helped by a technical rebound after a nine-day losing streak, although robust US jobs data raised worries over another US rate hike and kept bullion on track for its second weekly drop. Spot gold was up 0.6 percent at $1,831.09 per ounce but on track for its second straight weekly loss, down 0.9 percent so far.
US gold futures settled 0.7 percent higher at $1,845.20 per ounce. Benchmark Treasury yields headed for a weekly increase, denting the appeal of gold. The bounce in gold prices despite the strong jobs data indicates that selling pressure has been exhausted and there is covering of short positions, said Tai Wong, a New York-based independent metals trader.
FIIs and DIIs
Foreign institutional investors (FII) offloaded shares worth Rs 90.29 crore, while domestic institutional investors (DII) purchased Rs 783.25 crore worth of stocks on October 6, provisional data from the National Stock Exchange (NSE) showed.
With inputs from Reuters and other agencies.
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