The market plunged sharply, losing 1.6 percent on August 22 as bears tightened their grip over Dalal Street in the second half of the session as hopes for a stimulus dimmed. Selling was seen across sectors with Bank, Auto, Metal and Realty falling between 1.7 to 6.2 percent.
The benchmark BSE Sensex declined 587.44 points to 36,472.93 while the Nifty 50 fell to new corrective swing low of 10,718, before closing 177.30 points lower at 10,741.40.
Experts feel the selling pressure is likely to continue in the short term and advised using sell on a rise strategy.
According to the pivot charts, key support level is placed at 10,670.33, followed by 10,599.37. If the index starts moving upward, key resistance levels to watch out for are 10,860.23 and 10,979.17.
Nifty Bank closed at 27,034.20, down 684.85 points on August 22. The important pivot level, which will act as crucial support for the index, is placed at 26,776.5, followed by 26,518.8. On the upside, key resistance levels are placed at 27,491.0 and 27,947.8.
Stay tuned to Moneycontrol to find out what happens in currency and equity markets today. We have collated a list of important headlines from across news agencies.
US Markets
The benchmark S&P 500 ended little changed on Thursday as a fall in US jobless claims offset data showing a contraction in US manufacturing activity while investors awaited Federal Reserve Chair Jerome Powell’s speech on Friday for clues on the central bank’s monetary policy.
The Dow Jones Industrial Average rose 49.51 points, or 0.19%, to 26,252.24, the S&P 500 lost 1.48 points, or 0.05%, to 2,922.95 and the Nasdaq Composite dropped 28.82 points, or 0.36%, to 7,991.39.
Asian Markets
Asian shares struggled to make any headway on Friday as weak US manufacturing activity and uncertainty over how much further the Federal Reserve would cut rates added to the general air of caution in markets buffeted by global growth fears.
MSCI’s broadest index of Asia-Pacific shares outside Japan edged 0.1% lower, Japan’s benchmark Nikkei added 0.2% and Australian stocks eased 0.1%, while South Korean shares shed 0.3%.
SGX Nifty
Trends on SGX Nifty indicate a negative opening for the broader index in India, a with 0.08 percent loss or 8.5 points. Nifty futures were trading around 10,710-level on the Singaporean Exchange.
Oil prices eke out small gains ahead of Fed Chair speech
Oil prices clawed back the previous day’s losses on Friday, with Brent nudging above $60 a barrel, as tighter supplies from key producers offset slowing demand growth while investors await clues from the Federal Reserve on US monetary policy.
Brent crude rose 10 cents to $60.02 a barrel by 0118 GMT, while US crude futures were at $55.38 a barrel, up 3 cents. Both contracts were on track for a second weekly gain.
Rupee crashes to over 8-mth low of 71.81 against USD
The Indian rupee on August 22 plunged to an over eight-month low of 71.81, dropping 26 paise against the US dollar as tumbling equities and incessant foreign fund outflows weighed on sentiment. Also, the sudden drop in Chinese yuan led to increased volatility in emerging market currencies, including the rupee, forex dealers said.
At the interbank foreign exchange, the Indian currency opened weaker at 71.65 a dollar and went on to touch the day's lowest level at 71.97. It finally settled at 71.81, down 26 paise against the American currency. This was the lowest level for the rupee since December 14, when it had closed at 71.90.
Fed's Powell, under pressure, likely to stick to 'mid-cycle' message
Federal Reserve Chair Jerome Powell comes to this year's meeting of central bankers in Jackson Hole, Wyoming, caught between discord within the US central bank over appropriate monetary policy and mounting outside pressure for more interest rate cuts.
In navigating that divide, Powell is unlikely to use his keynote speech on Friday at the Kansas City Fed's annual economic symposium to veer much from the message he sent last month after the Fed cut rates for the first time in a decade: That the move was a "mid-cycle adjustment" and not the start of a rate-cutting cycle.
He will likely nod to the possibility that trade tensions, which have escalated since the July 30-31 policy meeting, may worsen a global economic slowdown and ultimately make more US rate cuts necessary.
US jobless claims fall in sign of labor market strength
The number of Americans filing applications for unemployment benefits fell sharply last week, suggesting the labor market was holding firm despite a manufacturing slowdown and concerns the economy is on a path toward recession.
Initial claims for state unemployment benefits dropped 12,000 to a seasonally adjusted 209,000 for the week ended August 17, the Labor Department said on August 22. The decline was sharper than expected. Economists polled by Reuters had forecast claims would drop to 216,000 in the latest week.
Japan's July core inflation hovers at two-year low
Japan’s core consumer inflation wallowed at a two-year low in July, increasing pressure for the central bank to acknowledge price momentum was slowing and expand its radical stimulus program.
With the global economy hit by the Sino-US tariff war and a pick-up in demand in the second half of the year uncertain, attention has turned to global central banks to gauge their readiness for further stimulus.
The core consumer price index, which includes oil products but excludes fresh food prices, rose 0.6% in July year-on-year, matching economists’ median estimate.
Domestic air passenger traffic grows by 3.01% in July
With the tourist season coming to an end, the domestic air passenger traffic in July increased by just 3.01 per cent compared to July last year, according to the data released by aviation regulator DGCA on August 22. The domestic air traffic in July this year consisted of 11.90 million passengers as compared to 11.55 million passengers in the same month last year, a jump of 3.01 per cent, as per the data.
In June this year, the domestic passenger growth was 6.19 per cent compared to the same month last year. The passenger load factor of all the major airlines -- Air India, IndiGo, SpiceJet, GoAir, AirAsia and Vistara -- declined in July as compared to June 2019, as per the DGCA data.
Two stocks under F&O ban period on NSE
For August 23, DHFL & IDBI are under the F&O ban period.
Securities in ban period under the F&O segment include companies in which the security has crossed 95 percent of the market-wide position limit.
With inputs from Reuters & other agencies
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