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 21 points at 19,827 points. On July 26, the Nifty50 rose nearly 100 points to 19,778 and formed a bullish candlestick with a small upper shadow on the daily charts, while the BSE Sensex climbed 351 points to 66,707.
The pivot point calculator suggests that the Nifty may get support at 19,732, followed by 19,706 and 19,665. In case of an upside, 19,815 can be the key resistance area followed by 19,841 and 19,882.
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 21 points on Thursday. The futures stood at 19,827 points.
Trade setup for Thursday: Top 15 things to know before the opening bell
US Markets
S&P 500 futures were little changed in overnight trading after the Federal Reserve instituted a quarter percentage point hike, bringing rates to the highest level in more than 22 years.
Futures linked to the S&P 500 traded flat, while Dow Jones Industrial Average futures lost 48 points, or 0.13 percent. Futures connected to the Nasdaq-100 rose 0.2 percent.
Meta Platforms shares popped nearly 7 percent in extended trading on better-than-expected results and strong guidance, while Chipotle Mexican Grill plunged about 9 percent as sales fell short of estimates.
In regular trading Wednesday, the Dow Jones Industrial Average rose for a 13th straight session, gaining 82.05 points, or 0.23 percent, to notch its longest win streak since 1987. The S&P 500 dipped 0.02 percent, while the Nasdaq Composite lost 0.12 percent. The moves came after the Fed implemented a widely expected 25 basis point hike, bringing interest rates to their highest level since 2001.
European Markets
European stock markets closed lower Wednesday amid a slew of earnings and ahead of the latest monetary policy update from the U.S. Federal Reserve. The benchmark Stoxx 600 index provisionally closed down 0.6 percent, with most sectors in negative territory. France’s CAC 40 fell 1.4 percent as luxury goods behemoth LVMH dropped over 5 percent after reporting a surprise slowdown in U.S. sales after the market close on Tuesday.
Banks were down 0.3 percent despite Deutsche Bank and UniCredit both beating analyst earnings expectations, while British aerospace and defense firm Rolls-Royce soared over 20 percent after it hiked its profit forecast for the year. The U.K.’s FTSE 100 lost 0.19 percent and Germany’s DAX lost 0.49 percent.
Asian Markets
Asia-Pacific markets were largely down as investors brace for the U.S. Federal Reserve’s rate decision on Wednesday. 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%-5.5%. That would push the upper boundary of the federal funds rate to its highest level since January 2001.
In Australia, the S&P/ASX 200 climbed 0.78 percent and closed at 7,396.8, its highest point since Feburary 2023. Australia’s inflation rate on an annual basis grew 6 percent in the June quarter, slower than the 7 percent seen in the first quarter, official data showed.
South Korea’s Kospi led losses in the region and fell as much as 2 percent, dragged by tech and consumer services stocks. The index eventually ended the day 1.67 percent lower and closed at 2,592.36, while the Kosdaq saw a larger loss of 4.18 percent and finished at 900.63.
In Japan, the Nikkei 225 was down marginally, extending its losses from Tuesday and closing at 32,668.34, while the Topix also sunk 0.1 percent to end at 2,283.09. Hong Kong’s Hang Seng index retreated from Tuesday’s rally and inched down 0.31 percent, while mainland Chinese markets also all fell. The Shanghai Composite was down 0.26 percent and closed at 3,223.02, while the Shenzhen Component lost 0.48 percent to end at 10,968.98.
US Fed hikes interest rates to highest level since 2001
The US Federal Reserve raised its benchmark lending rate on Wednesday to the highest level since 2001 to tackle above-target inflation and signaled the possibility of further increases ahead.
The quarter percentage-point rise lifts the Fed's key lending rate to a range between 5.25 percent and 5.5 percent, the US central bank said, adding that it will "continue to assess additional information and its implications for monetary policy."
The rate-setting Federal Open Market Committee (FOMC) used similar language when it voted to hold rates steady in June, and the latest statement suggests that policymakers are mulling another pause at their next meeting in September.
However, the Fed also said it would assess a range of data points "in determining the extent of additional policy firming," which indicates that they also see more monetary tightening ahead. This would be in line with the median forecast of two additional rate hikes this year at the last FOMC meeting in June.
Dr Reddy’s Q1 Results: Net profit rises 18% to Rs 1,402 crore, beats estimates
Pharma major Dr Reddy's Laboratories on July 26 reported an 18.1 percent rise in net profit at Rs 1,402.5 crore for the quarter that ended June 30, 2023, despite a high base of Rs 1,187.6 crore during the same period a year ago.
The company had a one-time gain of $72 million in the base quarter that it had received from British drugmaker Indivor as a settlement for a patent litigation for the generic drug Suboxone. Moreover, the net profit also topped the Street’s estimate of Rs 944.1 crore.
Revenue for the drugmaker rose 29.2 percent to Rs 6,738.4 crore as against Rs 5,215.40 crore in the year-ago period. The Street had pegged revenue for the company at Rs 6,458 crore for the quarter under review.
The company reported an EBITDA of Rs 2,137.2 crore for the quarter as against Rs 1,779 crore in the previous corresponding quarter. EBITDA margin came at 31.7 percent for April-June, against 34.1 percent in the year-ago period.
Axis Bank Q1 Results: Net profit grows 40%, asset quality improves
Axis Bank on July 26 reported a 40 percent rise in net profit to Rs 5,790 crore for the April-June FY24 quarter from Rs 4,125 crore last year.
According to a poll of three brokerages conducted by Moneycontrol, the bank was expected to report a net profit of Rs 5,889 crore. The lender missed analyst expectations. The bank’s net interest income (NII) grew 27 percent year-on-year (YOY) to Rs 11,959 crore. Net interest margin (NIM) for Q1FY24 stood at 4.10 percent, up 50 bps YOY.
The gross non-performing assets (GNPA) of the bank declined to 1.96 percent as compared with 2.76 percent last year. Also, the net non-performing assets (NNPAs) of the bank fell to 0.41 percent compared with 0.64 percent last year.
Oil Prices
Oil prices fell about 1 percent on Wednesday, after data showed U.S. crude inventories fell less than expected and the Federal Reserve raised interest rates by a quarter of a percentage point. Brent crude futures closed down 72 cents, or 0.9 percent, at $82.92 a barrel, while U.S. West Texas Intermediate (WTI) crude settled at $78.78, down 85 cents, or 1.1 percent.
Both benchmarks fell by more than $1 earlier in the session, after hitting three-month highs on Tuesday. The rate hike, the Fed’s 11th in its last 12 meetings, set the benchmark overnight interest rate in the 5.25%-5.50% range, and the accompanying policy statement left the door open to another increase.
Dollar Index
The Dollar index traded 0.17 percent higher in futures at 101.06, whereas the value of one dollar hovered near Rs 81.98.
Gold
Gold prices extended gains on Wednesday, helped by a weaker dollar and bond yields after the U.S. Federal Reserve delivered a widely expected interest-rate hike and investors digested comments from Chair Jerome Powell. U.S. gold futures settled 0.5 percent higher at $1,974.90.
The Fed raised interest rates by a quarter of a percentage point on Wednesday, marking the 11th hike in the U.S. central bank’s past 12 policy meetings, and the accompanying policy statement left the door open to another increase.
FIIs and DIIs
Foreign institutional investors (FII) bought shares worth Rs 922.84 crore, while domestic institutional investors (DII) purchased shares worth Rs 470.10 crore on July 26, provisional data from the National Stock Exchange (NSE) shows.
With inputs from Reuters and other agencies.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
