Pre Session- Bears may continue to haunt Dalal Street
03/06/2015
Indian equity benchmarks are poisted to retreat for a second straight day on Wednesday as the Reserve Bank of India’s (RBI) cautious outlook over further policy easing in Asia’s third biggest economy coupled with a downgrade of the Monsoon forecast may sour investor appetite for risky assets. The 30-share Sensex plummeted by 660.61 points or by 2.37 per cent to 27,188.38 on Tuesday while the Nifty plunged 196.95 points or by 2.34 per cent at 8,236.45 as traders looked past the RBI’s 25 basis points interest rate cut, the third such reduction this year. The RBI warned of upside risks to inflation including a below-par monsoon which has now been downgraded to 88 per cent of the Long Period Average, and can cause a spike in food prices, signaling that it could switch to a pause mode and wait a while longer before deciding to go for further rate cuts. Investors will also eye the Indian Services PMI data to be unveiled by HSBC and Markit Economics on Wednesday, and which may offer further cues over the health of the country’s economy. Weakness in the SGX CNX Nifty Index futures for June delivery which fell by 0.27 per cent at 8,206 at 10:38 am Singapore time, signal a gap down opening at Dalal Street on Wednesday. A mixed trend in Asia tracking a bearish finish at Wall Street overnight, may weigh on domestic sentiment. Asian shares were mixed as robust China services data was offset by uncertainty over Greece with the country facing a loan repayment to the IMF on Friday. Investors will eye the meeting of the European Central Bank (ECB) over the future of its stimulus program and the outlook for the Greek deal. Stocks in China and Hong Kong rose as acceleration in Chinese services activity signaled a pickup in the world’s second biggest economy. The HSBC China Services index climbed to 53.5 in May from 52.9 in April, with a reading above 50 signaling expansion. Japanese shares were lower tracking a negative close at American stock markets on Tuesday as US factory orders slid for the eighth time in nine months, down by 0.4 per cent in April.
03/06/2015
Indian equity benchmarks are poisted to retreat for a second straight day on Wednesday as the Reserve Bank of India’s (RBI) cautious outlook over further policy easing in Asia’s third biggest economy coupled with a downgrade of the Monsoon forecast may sour investor appetite for risky assets. The 30-share Sensex plummeted by 660.61 points or by 2.37 per cent to 27,188.38 on Tuesday while the Nifty plunged 196.95 points or by 2.34 per cent at 8,236.45 as traders looked past the RBI’s 25 basis points interest rate cut, the third such reduction this year. The RBI warned of upside risks to inflation including a below-par monsoon which has now been downgraded to 88 per cent of the Long Period Average, and can cause a spike in food prices, signaling that it could switch to a pause mode and wait a while longer before deciding to go for further rate cuts. Investors will also eye the Indian Services PMI data to be unveiled by HSBC and Markit Economics on Wednesday, and which may offer further cues over the health of the country’s economy. Weakness in the SGX CNX Nifty Index futures for June delivery which fell by 0.27 per cent at 8,206 at 10:38 am Singapore time, signal a gap down opening at Dalal Street on Wednesday. A mixed trend in Asia tracking a bearish finish at Wall Street overnight, may weigh on domestic sentiment. Asian shares were mixed as robust China services data was offset by uncertainty over Greece with the country facing a loan repayment to the IMF on Friday. Investors will eye the meeting of the European Central Bank (ECB) over the future of its stimulus program and the outlook for the Greek deal. Stocks in China and Hong Kong rose as acceleration in Chinese services activity signaled a pickup in the world’s second biggest economy. The HSBC China Services index climbed to 53.5 in May from 52.9 in April, with a reading above 50 signaling expansion. Japanese shares were lower tracking a negative close at American stock markets on Tuesday as US factory orders slid for the eighth time in nine months, down by 0.4 per cent in April.
