Podcast | Trade war fears grips equity markets across the globe; Nifty ends below 10,950
Bucking the global trend, Nifty managed to close in positive compared to muted performance seen in other Asian markets amid fears of trade wars between US and China.
Asian markets closed sharply lower as trade war fears continued to dominate cues. The US is planning an additional $ 200 billion import tariff on Chinese goods. Shanghai composite fell 1.78 percent to close at 2,777.20.
European indices too were trading lower on the back of similar concerns on trade war as well. Stoxx 600 was off by 1.14 percent.
Even though Indian markets bucked the trend but benchmark indices closed near their respective intraday low levels as investors preferred to book profits at higher levels. The index closed flat but with a positive bias below its crucial resistance level of 10,950 levels.
The S&P BSE Sensex which rose over 100 points in the intraday trade pared most of the gains and closed just 26 points higher at 36,265.93. The index also breached its all-time closing high intra-day, but failed to sustain.
The broader markets underperformed, with BSE Midcap & Smallcap closing lower by 0.7 percent and 0.3 percent respectively. Amongst the sectors, IT index was a top performer, up 2.4 percent led by a sharp upmove in share price of TCS post impressive Q1FY19 numbers.
Realty & FMCG also outperformed. However, rest of the indices witnessed profit taking with Metals being the top loser, down 3.1 percent amid fears of trade war, followed by auto, consumer durables and capital goods.
“After a smart upmove, some consolidation cannot be ruled out in the coming sessions. Key domestic macro events like May IIP, June CPI inflation data and corporate earnings season will provide further direction to the markets in the near-term,” Jayant Manglik, President, Religare Broking Ltd told Moneycontrol.
“Stock/sector specific volatility will remain high. The progress of monsoon, movement of crude oil prices and global developments will continue to be monitored by the market participants. The rising trade tensions between US & China could induce high volatility across the indices globally. Traders should avoid risky leveraged positions,” he said.
Top Sensex gainers include names like TCS, Bajaj Auto, HUL, Infosys, RIL, Axis Bank, and Adani Ports.
Top Sensex losers include names like Coal India, Vedanta, Tata Motors, Tata Steel, SBI, and ICICI Bank.
Stocks in news:
Share price of Tata Consultancy Services rallied 5.47 percent to end at record closing high of Rs 1,979 as the company kicked off June quarter earnings season on a strong note with the profit growing 6.3 percent and revenue 6.8 percent sequentially, backed by recovery in banking vertical and maintaining momentum in industry verticals.
IDBI Bank share price rallied 7 percent after media reports suggested that there could be open offer from country’s largest insurance company LIC. The rally was in addition to more than 10 percent upside in previous two consecutive sessions, taking total this week’s gains to more than 21 percent. The insurance behemoth will make an open offer to minority shareholders of IDBI Bank in which it proposes to acquire up to 51 percent equity, PTI said quoting sources.
V2 Retail share price rallied 2 percent after ace investor Ashish Kacholia picked up a percent stake in the company. Ashish Kacholia’s name is reflected under public shareholders list in the company’s latest shareholding pattern published on exchanges.
Shares of Gammon Infrastructure Projects has locked at 5 percent lower circuit on termination of contract with APRDC. The company’s unlisted subsidiary Rajahmundry Godavari Bridge has terminated the concession agreement with (APRDC) Andhra Pradesh Road Development Corporation for project of bridge across Godavari river.
Shares of ASM Technologies gained 4.3 percent as company signed agreement for investment in RV Forms. The company has signed the LLP agreement and related documents pertaining to the investment of 70 percent in RV Forms & Gears LLP, a Chennai based firm.