The market is likely to see a flat opening as the GIFT Nifty indicates a muted start for the broader index, with a gain of 12 points at 19,869 points on Wednesday.
On July 25, the BSE Sensex was down 29 points at 66,356, while the Nifty50 gained 8 points to 19,681 and formed a bearish candlestick pattern with a lower shadow on the daily charts. The index has taken good support at 10-day EMA (exponential moving average) of 19,655 for yet another session.
The pivot point calculator suggests that the Nifty may get support at 19,632, followed by 19,605 and 19,562. In case of an upside, 19,719 can be the key resistance area, followed by 19,745 and 19,789.
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 flat start for the broader index with a gain of 12 points on Wednesday. The futures stood at 19,869 points.
Trade setup for Wednesday: Top 15 things to know before the opening bell
US Markets
Futures tied to the S&P 500 traded near flat on Tuesday night as investors parsed a batch of corporate earnings from major technology names and geared up for Wednesday’s interest rate policy decision. S&P 500 futures were little changed, while Nasdaq 100 futures slid 0.2 percent. Futures tied to the Dow Jones Industrial Average slipped 42 points, or 0.1 percent.
Mega-cap tech stocks were among the biggest movers in extended trading following their respective earnings reports. Google-parent Alphabet rose more than 6 percent as cloud revenue growth helped propel the company to a better-than-expected quarter. On the other hand, Microsoft slid more than 3 percent after reporting slowing cloud revenue growth.
Outside of Big Tech, Snap tumbled 19 percent in after-hours action after giving weak guidance for current-quarter performance. Investors are counting down to the Federal Reserve’s latest interest rate policy decision and subsequent press conference with Chair Jerome Powell scheduled for Wednesday afternoon. The market is pricing in around a 98 percent chance the central bank raises the interest rates, according to the CME FedWatch Tool. That would mark a return to hikes after not increasing interest rates at the June meeting.
European Markets
European markets closed higher on Tuesday as investors assessed economic data and corporate earnings, while gearing up for a big week of central bank meetings. The pan-European Stoxx 600 index ended 0.47 percent higher, a sixth straight positive session. Mining stocks jumped 4.46 percent to lead gains on the back of new Chinese stimulus measures, while travel and leisure stocks fell 0.6 percent.
European stocks closed 0.47 percent higher Tuesday, with mining stocks climbing 4.46 percent and technology up by 1.2 percent. The UK’s FTSE 100 gained 0.17 percent and Germany’s DAX rose 0.13 percent as France’s CAC 40 slipped 0.16 percent.
Asian Markets
The Asia-Pacific markets were mixed as investors braced for the US Federal Reserve’s rate decision due tomorrow. The Fed is expected to approve what would be the 11th interest rate increase since March 2022.
Markets are pricing in an absolute certainty that the Fed will approve a quarter percentage point hike that will take its benchmark borrowing rate to a target range of 5.25 percent-5.5 percent. That would push the upper boundary of the federal funds rate to its highest level since January 2001.
In Australia, futures for the S&P/ASX 200 opened 0.1 percent up, ahead of its inflation figures for June. The inflation print comes ahead of the Reserve Bank of Australia’s rate decision on August 1, and will be a key consideration for the central bank. In Japan, the Nikkei 225 was down 0.46 percent, extending its losses from Tuesday, while the Topix also sunk 0.42 percent.
South Korea’s Kospi dropped 0.52 percent in early trade, but the Kosdaq rose 0.62 percent, on pace to record a 11th day of gains in 12 days. Hong Kong’s Hang Seng index is set to retreat after recording gains of over 4 percent on Tuesday, with futures at 19,390 compared to the HSI’s close of 19,434.4.
IMF raises India's FY24 GDP growth forecast by 20 bps to 6.1%
The International Monetary Fund (IMF) has raised its GDP growth forecast for India for 2023-24 to 6.1 percent from 5.9 percent due to the blowout growth number for January-March.
"Growth in India is projected at 6.1 percent in 2023, a 0.2 percentage point upward revision compared with the April projection, reflecting momentum from stronger-than-expected growth in the fourth quarter of 2022 (financial year 2022-23) as a result of stronger domestic investment," the multilateral agency said on July 25 in an update to its World Economic Outlook (WEO) report.
L&T gets board nod for Rs 10,000-crore share buyback at 17% premium
Engineering and construction major Larsen and Toubro (L&T ) will buy back as much as Rs 10,000 crore worth of shares, its first-ever return of capital to shareholders. The company’s board has approved the proposal to buy back 3.33 crore shares, representing 2.4 percent of the total paid-up equity share capital, at a maximum price of Rs 3,000 apiece, the company said in a statement.
The offer represents a premium of more than 17 percent to the July 25 closing price of Rs 2,561.95 . The buyback is subject to shareholders’ approval. The buyback is subject to approval from the Securities Exchange Board of India (Sebi). This is L&T's second attempt after its earlier board-approved buyback for around Rs 9,000 crore was denied by Sebi in 2019, citing non-compliance with regulations.
Tata Motors Q1 Results: Automaker swings back into profit of Rs 3,203 crore on JLR boost
Tata Motors, on July 25, swung back into the black with a consolidated net profit of Rs 3,203 crore for the first quarter of fiscal year 2023-24 (Q1 FY14), boosted by the improved margin of its passenger vehicle (PV) business and robust sales at its luxury car unit, Jaguar Land Rover (JLR).
The automobile manufacturing company had reported a net loss of Rs 5,006.60 crore in Q1 FY23 on revenues of Rs 71,934.66 crore. Revenue from operations increased 42 percent to Rs 1.02 lakh crore in the quarter under review. Earnings before interest, taxes, depreciation, and amortization (EBITDA) for the quarter stood at Rs 14,700 crore, up 177 per cent.
Oil Prices
Oil prices rose to fresh three-month highs on Tuesday, as signs of tighter supplies and pledges by Chinese authorities to shore up the world’s second-biggest economy lifted sentiment.
Brent futures gained $1.41 at $83.78 a barrel by 2:07 p.m. EDT. U.S. West Texas Intermediate (WTI) crude rose $1.04 at $79.78. The crude benchmarks have already clinched four weekly gains in a row, with supplies expected to tighten due to output cuts from the Organization of the Petroleum Exporting Countries (OPEC) and allies.
Dollar Index
The Dollar index traded 0.07 percent higher in futures at 101.42, whereas the value of one dollar hovered near Rs 81.86.
Gold
Gold prices rose on Tuesday on a weaker dollar and expectations that the US Federal Reserve will likely end its monetary tightening cycle after a widely expected rate hike this week. Spot gold rose 0.4 percent to $1,962.8307 per ounce. US gold futures inched up 0.1% to $1,964.60.
“Gold is expected to be in a range-bound trade before the Fed decision. But there is optimism here that the Fed is almost done with rate hikes and that will support the market,” said Edward Moya, senior market analyst at OANDA.
The focus is on a series of central bank meetings this week, starting from the Fed policy decision on Wednesday, followed by the European Central Bank (ECB) on Thursday and the Bank of Japan a day later.
FIIs and DIIs
Foreign institutional investors (FII) bought shares worth Rs 1,088.76 crore, whereas domestic institutional investors (DII) sold shares worth Rs 333.70 crore on July 25, provisional data from the National Stock Exchange (NSE) shows.
With inputs from Reuters and other agencies.
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