09/07/2015 08:39
Indian equity benchmarks which bled heavy on Wednesday, may recover some lost ground as investors shift their focus to the start of the Q1 FY 2015-16 corporate earnings season that kicks off on Thursday with IT bellwether TCS and Bajaj Corp set to unveil their April-June quarter report cards today. The country’s largest IT software services exporter, TCS, may report a 7.5 per cent dip in sequential revenue for the quarter ended June 30, 2015 with dollar-denominated revenue likely to have risen by 4.2 per cent. However, caution ahead of tomorrow’s industrial output data for May which may show that factory growth probably slowed to 3.6 per cent following 4.1 per cent in April, coupled with lingering concerns over China and Greece, may hold back gains in the Sensex. Positive trade in the SGX CNX Nifty Index futures for July delivery which rose 0.11 per cent at 8,374.50 at 10:22 am Singapore time, signals a gap up opening at Dalal Street on Thursday. The 30-share benchmark had slumped by 483.97 points or by 1.72 per cent to end at 27,687.72 on Wednesday as investors shunned risky assets as a deepening stock market rout in China and heightened fears that Greece may be pushed out of the euro roiled market sentiment.
Most Asian stocks bounced back from yesterday’s steep rout with markets in China rising for the first time in three days as officials took further measures to arrest an equity rout that has wiped out more USD 3 trillion of value. Late Wednesday, China banned major shareholders from selling stakes in listed companies, the latest in a series of measures undertaken by policymakers that have included interest rate cuts to loosening of bank’s reserve requirements and suspension of new share sales to restore confidence in the country’s stock market. Meanwhile, China’s consumer inflation accelerated to 1.4 per cent in June 2015 from 1.2 per cent in May 2015 while producer prices remained under the firm grip of deflation. Meanwhile, Greece has until tonight to submit fresh economic reform measures including spending cuts to press for a new bailout and convince European leaders to keep the cash-strapped country in the euro. While Hang Seng also rebounded after a severe dip in the previous session, Japanese stocks remained under pressure as an investor flight to the safety of the yen dimmed the lure for exporter stocks. On Wednesday, Wall Street, fell prey to intense selling pressure with benchmarks shedding more than 1 per cent after the Federal Reserve in the minutes of its latest policy meet in June warned of the potential risks to the US economy from the turmoil in Greece and China.
