A day after the government reported slower-than-expected GDP growth for Jan quarter, foreign brokerages have cut their forecasts by up to 0.3 percentage points.
Nifty50 futures on the Singapore Stock Exchange were trading 50.50 points higher at 8,025.50, indicating a positive opening for the domestic market.
The Reserve Bank of India (RBI) has suggested to the finance ministry that the government buy back Inflation Indexed Bonds (IIBs) linked to the wholesale price index (WPI).
The activity we are seeing in most of the smaller cap companies and larger names from the oil marketing space suggest that this budget will be a very good budget in terms of improving the macros.
"There is not too much expectation of 50 bps rate hike, but if that happens, it would be negative for sectors which are capital-intensive."
“If consumer spending gets hit and then it is very difficult to revive, the momentum is lost it becomes very difficult to revive and no amount of interest rate cuts or tax cuts start working”
ICICI Bank today said the entry of these new entities would strengthen the overall financial ecosystem and also benefit existing banks.
Analysts on Dalal Street say a rate cut by the Reserve Bank of India (RBI) is expected to be the next big trigger for the Indian market.
"I see a consolidation at these levels. Midcap companies are in action since the last three days. So, we think 8,600-8,650 should be a consolidation zone."
According to CCI, Sumitomo Mitsui did not provide details regarding its stake in Ambit Investment Advisors Pvt Ltd (AIAPL).
The governor has taken the cautious view but his decision not to lower the policy rate this time is unjustified. We need to watch what he will do six weeks from now.
Central banks sometimes do have to be courageous and take matters in their hands. You can never be 100 per cent right but you need to take that call.
The domestic currency had fallen 9 paise to settle at 64.13 against the greenback on Friday amid sustained demand for the US currency.
"Given that this time banks have come stronger and the hangover of the RBI policy being there in future, this should clearly signal that the up move today should extend."
The rupee had lost six paise to close at 61.52 against the dollar in yesterday's range-bound session in line with a fall in local equities.
FIIs have been net buyers of Rs 13,243 crore in derivatives this month compared with just Rs 1,102.13 crore last month.
Banks and RBI have been at loggerheads for years on either passing on benefits of lower interest rates or raising rates to reflect RBI's tightening monetary stance.
The tension of Fed hike is making its presence felt on the bourses, with the Sensex slipping by nearly 1,000 points so far in March.
Chairing a special meeting of the State Level Banking Committee, Fadnavis asked the banks to study the pockets which do not have any branches.
Tune in now! The morning briefing of news, views and cues before you start your day on Dalal Street.
We will see these stocks being very volatile, but you have to buy these stocks at lower levels and then hold them for the next six-nine months, says Jaipuria.
Continue to be selectively bullish on metal and Hindalco is a favourite stock
Investors are keenly awaiting domestic auto sales numbers, PMI readings, big Q1 results.
Inflation is comfortably at the 4% range and there is case for 25 bps rate cut.
"So far, the economy's modest recovery has been shaped by good luck on crude oil and commodities, and a supportive policy environment.
Nifty PE multiple at about 24 times on a trailing basis, is at the 2007 peak level after which markets crashed
Broadly, Nifty shouldn't break the 6600 levels and would hit 6800 levels on the upside. So, Nifty will moving in the 6600 to 6800 broad range, he said.
That is quite heartening to the debt markets, which had faced quite a bit of the brunt at the time when the currency had depreciated significantly.
RBI, on expected lines, decided to keep policy rates on hold at 6.75%. It also kept the CRR of scheduled banks unchanged at 4% of net demand and time liability.
At 07:45 am, Nifty50 futures on the Singapore Stock Exchange were trading 10 points higher at 7,569.50, indicating a gap-up opening for the domestic market.
SBI as well as top private-sector rivals ICICI Bank and HDFC Bank have recently cut the rates they offer on term deposits following an improvement in liquidity.
'With all the other sectors doing fairly well, the markets may trade in a range 5500 to 6200 for the near term, but if I had cash, it is a good time to buy'
The important takeaway from the Governor’s speech is his dovish stance on future rate cuts as he expects inflation to fall and come below RBI’s comfort level.
D-Street might just manage to shrug off it all as domestic lenders on Tuesday promised to quickly pass on latest rate cut by the RBI and IMF said the Indian economy is recovering strongly.
The reverse repo rate under the LAF stands adjusted to 5.75% and the marginal standing facility (MSF) rate and the bank rate comes down to 6.75 per cent.
Nifty50 futures on the Singapore Stock Exchange were trading 4.50 points lower at 8,783.50, indicating a flat opening for the domestic market.
Retail inflation edged up to 5.01 per cent in May on costlier pulses even as prices of fruits and vegetables eased during the month.
The policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.5 per cent.
Even though a correction was on the cards in the domestic market, experts still advise investors to remain cautious and tread carefully over the next few weeks.
Total turnover of Interest Rate Futures on three major stock exchanges surged by 54.4 per cent to Rs 39,817 crore in November compared to the previous month.
Sinha cautioned banks to desist from blatant evergreening of loans or restructuring of debts as it was not good for the health of financial sector.
'Going back to 2007-2008, these norms were part of the Raghuram Rajan Committee on financial sector reforms,' says Kamath.
Reserve Bank Governor Raghuram Rajan, however, cautioned that uncertain monsoon may prevent future rate cuts, an outlook that disappointed markets.
Rajan, was quick to add that the move to cut rates is not conservative and that the RBI has chosen to "err" to give a boost to investment.
"It is best to avoid the banks all of them together especially public sector banks," Mehta said.
The rupee recovered by eight paise to 63.02 against the American currency in late morning trade today on fresh selling of dollars by banks.
Realtors' body CREDAI said RBI should cut key interest rate by 50 basis points to boost housing demand as well as growth of the realty sector.
"I do not see RBI as a regressive command-and-control thing as you seem to think it is. There are issues, but that does not necessarily mean the RBI is going the wrong way."
Nifty50 futures on the Singapore Stock Exchange were trading 8.50 points lower at 0.11, indicating a flat opening in the domestic market.
While our NIMs looks very high vis-à-vis global averages, our return on equity adjusted for the actual NPAs does not look that great vis-à-vis other entities.
Reserve Bank Governor Raghuram Rajan will announce the fifth bi-monthly monetary policy review on December 1.
ED has begun probe against industrialist and Congress leader Naveen Jindal and his family for alleged contravention of forex laws.
While the governor may not cut rates further, the policy is expected to be accommodative with the RBI providing enough liquidity .
"Ideally RBI will be pushing for SLR and HTM at the same level. As a bank we were expecting this to be so; there is nothing surprising."
In a chat with ET Now, Gaurang Shah, VP, Geojit BNP Paribas Financial Services shares his market outlook.
Rupee could be an out performer among EMs as global investors’ carry trade could get a boost amid expectations of a stable currency.
"Even at this rate banks are not getting deposits. However, the trajectory is down and so, a rate cut is coming. But it's tough to predict the time."
"However, I did not expect a cut today, because Governor Rajan tends to make his announcements between meetings, and not necessarily at meetings."
The impact of the RBI's move to hike repo rate by 25 bps to 8% was seen on banking stocks. The Bank Nifty corrected 206 points intraday
The domestic unit moved in a range of 62.10-62.24 during the day before concluding at 62.19, showing a gain of 30 paise or 0.48% against the dollar.
A 25 bps cut can be expected from the June 19th policy because GDP growth has come down to around 4.8% and inflation has started showing signs of lower trajectory.
it is an important event and it will have an impact maybe 2-3% either side on the indices but it is not going to change the course of the market in the medium to long term.
Rate-sensitive stocks were partly to blame, so was a COAI report suggesting that Reliance's telecom arm was offering full-fledged services to its users in name of 'tests'.
Nifty rose in a vertical line in the past five months. In percentage terms, it rose by 27 per cent from its 52-week low of 6,825 recorded back in February.
Finances of states are likely to improve going forward due to falling borrowing costs, which have come down by upto 28 bps since the beginning of the fiscal.
Your FD will yield you less in the present scenario, Abheek Barua of HDFC Bank said.
Our view has been that was India could easily reduce interest cost by at least 50 bps without having any impact on the currency.
In an exclusive chat with ET Now, Tanvee Gupta Jain, India Economist at Macquarie Securities, said that manufacturing goods will see a fall in the tax rate which are currently taxed at 22.5%.
Investors will keenly follow earnings season, RBI stance, says Raheja. RBI stance on policy rate will drive sentiment as the economy is recovering slowly, he adds.
Accepting the RBI suggestion may have helped resolve the Tata-Docomo row although it could impact other such transactions differently.
Reliance Capital said it would establish a new bank in India with support of SMTB as a strategic partner, as and when the RBI policy permits.
In a filing, the company said its total income (including other income) during the period rose to Rs 2,796 crore from Rs 2,689 crore a year ago.
For the movement it does not look like we are going to collapse from here but what it appears is that the market is going to drift along may be in 100 point ranges.
The RBI had maintained status-quo on interest rate in its two credit policies announced after the formation of the new government in May.
Mythili Bhusnurmath and Charan Singh, ED, UCO Bank discuss macro cues including the possibility of a June Fed rate hike, the RBI policy tomorrow and the expecations from Indradhanush 2
ADAG is a high beta bunch of stocks and in this kind of market, it will be under pressure.
India's annual consumer price inflation quickened to 4.41 percent in September from a year earlier, compared to an annualised 3.66 percent in August, government data showed.
We are not an over-leveraged country. So the impact of QE2 on us is indirect in a way, says KV Kamath.
The RBI may pause in its policy review meet in Aug, an HSBC report has said, adding that there is a possibility of a rate hike in the last quarter.
The market is trying to digest two things at this stage. One is clearly the RBI policy which has set this limited room for rate cuts.
The repo rate, at which the RBI lends to banks, was retained at 8% and the cash reserve ratio (CRR) was kept unchanged at 4 per cent.
The number of trading clients on NSE from north rose by 12 per cent on the cash segment during the first nine months of 2014-15.
"We do not expect rupee to appreciate, except for very short periods of time. The longer-term trend will clearly be towards gradual depreciation."
They are vary about taking these loans and it will make our job easier sourcing corporates by telling them these projects will not show up as NPAs.
So, there are a number of measures that the governor has taken, particularly in terms of extending the kind of maturity for the FPI flows into the country.
Tracking the momentum, the Nifty index may retest its crucial psychological level of 7,850-7,800 in trade today.
“NPAs in the commercial lending book of most banks would have doubled over last 12 to 18 months.”
Gurumurthy expects the average inflation for FY16 to be well within RBI’s expected trajectory.
Tracking the momentum, the Nifty index may retest its crucial psychological level of 7,800-7,750 in trade today.
'RBI’s view is that low inflation is the best way to ensure growth, but the point is that in a country like India you cannot really focus only on one thing."
The deal would make the Japanese major a strategic partner of RCap to collaborate on various businesses, including in its proposed banking venture.
SKS Microfinance cracked 20 per cent to hit a low of Rs 360.60 on NSE. On BSE, the stock fell 16.65 per cent to hit a low of Rs 376.65.
PSU banks can offer good returns in the next 12 months, but it would not be wise to hold them for long, says Tandon.
You buy only when you think that you would stay invested in the market for at least two to three years, says Kohli.
Overseas investors are keenly watching the onset and progress of monsoon and RBI governor Raghuram Rajan’s term extension after September, said Gopikrishnan MS.
Atsi Sheth bets on India as the fastest growing economy among similar rated sovereigns, despite a lower-than-expected June quarter GDP growth.
From an expenditure GDP perspective, the ongoing consumption slowdown will overlap the delayed improvement in investment, the brokerage said.
The expectation that private investment will come in such a hurry was probably misplaced, private investment follow GDP growth, he said.
With the pay commission being on the anvil and the expectations of a above normal monsoon, way is clear for demand creation and increase in capacity utilisation
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