Stock Market Updates

*Morning comments (HDFCSec Retail Research)* *All eyes on MPC* *Indian markets could open flat to mildly higher, in line with mixed Asian and US markets on June 06* Stocks closed mixed Thursday, after the European Central Bank cut rates for the first time in five years and as investors looked ahead to Friday's monthly jobs report to help gauge the strength of the U.S. economy. Wall Street expects to see 190,000 new jobs in the May report, slightly up from April. The unemployment rate is expected to hold steady at a historically low 3.9% Any upside or downside surprise could prompt investors to reassess their outlook for Fed rate policy. Many analysts eye September as the most likely time frame for a rate cut, assuming inflation continues to ease. The European Central Bank cut rates for the first time since 2019. The move was expected but marks a significant change in the central bank's policy. Attention now turns to when the Federal Reserve will follow suit. Monetary Policy Committee is likely to maintain status quo on the Reserve Bank of India's key lending rate amid the continuing need to bring down inflation further, even as economic activity remains strong. All economists polled expect the MPC to hold the Reserve Bank of India's repo rate steady at 6.5%. This will be the first RBI policy after the Lok Sabha election results 2024. In corporate news, Wipro Ltd said it has been awarded a $500-million deal by a leading US communication service provider over a period of five years. Wipro shall provide managed services for some products and industry-specific solutions. RVNL had been awarded a contract worth Rs 495 crore by the NTPC. IRB Infrastructure Developers Ltd along with its associate announced a strong year-on-year toll revenue growth of 30% for May 2024. Nifty extended its recovery for a second consecutive session on June 06 after the steep fall witnessed on June 04. Broad market indices rose more than the Nifty even as the advance decline ratio rose. The intra day volatility is falling over the past two days. Nifty could now stay in the 22419-23180 band for the near term. RBI Governor’s commentary on inflation and future interest rate cut trajectory will drive the markets in the near term. Indian markets could open flat to mildly higher, in line with mixed Asian and US markets on June 06.

The S&P 500 and Nasdaq Composite ended at records Wednesday as Nvidia Corp.'s market capitalization touched the $3 trillion mark for the first time. Nvidia is now worth more than Apple, becoming the second-largest U.S. company behind only Microsoft. The rise came amid tentative optimism for interest rate cuts on signs of slowing labor demand and a cooling economy. US treasury yields continued their fall this week as rate-cut bets were boosted by data showing the economy created fewer than expected private sector jobs in May, with just 152,000 workers hired in the month, down from 188,000 in the prior month, and missing economists estimates of 173,000. Bank of Canada became the first Group of Seven central bank to kick off an easing cycle. The Bank of Canada has trimmed its key policy rate by 25 basis points to 4.75 percent, in a widely expected move that marked its first cut in four years, and said more easing was likely if inflation continued to ease. Asia-Pacific stocks rose on Thursday as hopes for rate cuts by the European Central Bank boosted market sentiment, while major indexes in the U.S. hit fresh highs overnight. BHEL secures Rs 3,500 crore order from Adani Power for Chhattisgarh thermal plant Indian Energy Exchange reports 28.9% jump in May 2024 volumes Torrent Pharma in pact with Takeda to commercialize acid reflux drug Nifty erased some of the previous day's losses and ended higher on June 05 after the NDA allies pledged support for the alliance to form a government for the third term. At close, Nifty was up 3.36% or 735.9 points at 22620.4. Nifty now should consolidate after a sharp fall. Nifty could now head towards 22858 and 23180 on the upside while 22319 could offer support in the near term.

US stocks tossed between negative and positive territory on Tuesday, finishing narrowly in the green as investors shifted their rate-cut expectations after more weaker-than-expected economic data. US job openings fell in April to their lowest level since February 2021 (8.1 million, confounding economists' estimates for an increase to 8.37M) as the labor market shows further signs of rebalancing. China's services activity in May accelerated at the quickest pace in 10 months while staffing levels expanded for the first time since January, pointing to sustained recovery in the second quarter. The Caixin/S&P Global services purchasing managers' index (PMI) rose to 54.0 from 52.5 in April, expanding for the 17th straight month and growing at the fastest pace since July 2023. Asian markets traded with a mixed outlook on Wednesday following higher close of US indices on renewed expectations of rate cuts by the Federal Reserve due to a cooling US labour market. GPT Infraprojects received an order of Rs 547 crore Tata Motors’ finance unit to merge with Tata Capital Shilpa Medicare filed Type IV DMF of recombinant Human Albumin 20% Nifty tumbled to log its worst session in over four years on June 04 as vote counts from the nation's marathon elections indicated that the incumbent Bharatiya Janata Party might be reliant on alliance partners to return to power for a third time. At close, Nifty was down 5.93% or 1379.4 points at 21884.5. Nifty crashed on June 04 as vote count suggested weaker than expected performance by the NDA. While clarity on the final outcome and formation of the new Govt could take some more time, Nifty could fluctuate between 21710 to 22417 in the near term. Indian markets could open flat to mildly higher, in line with mixed Asian markets today and higher US markets on June 04.

U.S. stocks closed mostly higher on Monday in a volatile day of trade following an early trading glitch on the New York Stock Exchange and as investors looked forward to a series of economic data due later this week, including the jobs report due Friday. The Dow recovered the bulk of its previous losses in the final hour of trade, while the S&P 500 turned positive. U.S. and global benchmark crude futures settled Monday at their lowest levels since February, pressured in the wake of a weekend decision by major oil producers that would lead to higher oil production later this year. July West Texas Intermediate crude fell $2.77, or 3.6%, to settle at $74.22 a barrel on the New York Mercantile Exchange. Asian stocks fell Tuesday morning after concerns about the health of the US economy outweighed expectations for early Federal Reserve policy easing. Welspun Corp associate company signs Rs 3,670 crore contracts with Aramco for steel pipe supply Amber Enterprises may invest Rs 2,000 crore to set up printed circuit board facility PNC Infratech subsidiary receives Rs 391 crore from NHAI in settlement agreement Nifty logged its best session in over three years on June 03, as investors cheered exit polls, along with better-than-expected India Q4 GDP. At close, Nifty was up 3.25% or 733.2 at 23263.9. It made a new all-time high with large volumes based on the event and economic data. It could now rise towards 23490 in the near term while 23039 could offer support. Counting of votes and final election results could lead to some level of volatility, though lower than the previous session. Indian markets could open higher, in line with mixed Asian markets today and mostly higher US markets on June 03

India’s Prime Minister Narendra Modi looks set for a rare third consecutive term in power, as local exit polls on Saturday suggested his Bharatiya Janata Party-led alliance will clinch a decisive parliamentary majority. According to an exit poll summary by local news channel NDTV, the BJP-led National Democratic Alliance is expected to secure around 365 out of the 543 seats in the lower house of parliament. Asian stocks gained on Monday, as a softer reading of the US Federal Reserve’s preferred measure for inflation bolstered rate-cut hopes. Nifty formed a long legged doji on May 31 and broke the 5-day losing streak. It formed a sideways candle compared to the previous session. On weekly charts, Nifty fell 1.86%, while on monthly charts, Nifty ended May 0.33% lower forming a long doji after a rise. Exit polls' outcome has been slightly better than median expectations. Nifty could see volatile moves early this week after a higher opening based on the outcome of exit polls and later the actual results of voting. Nifty could face resistance in the 22993-23110 band while 22150 could offer support for the early part of next week. *DJ (HDFCSec Retail Research)*

U.S. stocks ended mostly higher Friday, after erasing earlier losses shortly before the closing bell. India's gross domestic product (GDP) growth surpassed all expectations and stood at 7.8 percent in the January-March quarter, though slower versus 8.4 percent in the third quarter. The full-year 2023-24 GDP growth has been revised upwards to 8.2 percent from the second advance estimate of 7.6 percent. India's eight core sectors posted a growth of 6.2 percent in April, backed by strong electricity and steel output. India's gross goods and services tax (GST) collections rose to ₹1.73 lakh crore in May (vs Rs.2.10 lakh cr in April), growing 10 per cent year on year (YoY) driven by increased revenues from domestic transactions India’s Prime Minister Narendra Modi looks set for a rare third consecutive term in power, as exit polls on Saturday suggested his Bharatiya Janata Party-led alliance will clinch a decisive parliamentary majority. Asian stocks gained on Monday, as a softer reading of the US Federal Reserve’s preferred measure for inflation bolstered rate-cut hopes. Adani Ports signs 30-year deal to operate terminal at Tanzania's Dar es Salaam Port Coal production in May grew by 7.5% year-on-year to 64.4 million tonnes, and offtake increased by 7.2% year-on-year to 68.2 million tonnes. NMDC’s iron ore output falls 37% in May; sales down 22 % Indian markets could open sharply higher due to outcome of exit polls in favour of ruling dispensation

U.S. stocks closed lower on Thursday, pulled down by tumbling technology stocks, including the roughly 20% drop in shares of Salesforce Inc. US Gross domestic product rose 1.3% annualized in the first three months of the year, below the previous estimate of 1.6%, Bureau of Economic Analysis figures published Thursday showed. The economy’s main growth engine — personal spending — advanced 2.0%, versus the previous estimate of 2.5%. India's economy is expected to have grown at a slower pace in the January-March quarter than the previous three months, dampened by a moderation in manufacturing and urban spending. The gross domestic product is estimated to grow by 7% in the January–March period, according to economists, lower than the higher- than-expected 8.4% expansion in the previous quarter. The GDP figures will be released on Friday at 1200 GMT. MSCI's quarterly rejig will come into effect following the market close on May 31, leading to potential inflows of around $2 billion into the Indian equity markets. MSCI's quarterly rebalancing will lead to 13 new stocks being added to the MSCI Global Standard Index, while three stocks will be excluded. China's manufacturing activity unexpectedly fell in May, keeping alive hopes of fresh stimulus as a prolonged property crisis continues to weigh on businesses, consumers and investors. Asian stocks rose Friday as the latest round of US economic data signaled economic momentum is slowing, boosting the case for the Federal Reserve to start cutting interest rates this year. Federal Bank and Tata AIA Life Insurance Announce Strategic Bancassurance Partnership IDFC First Bank to issue shares worth Rs 3,200 cr via preferential issue Orient Electric appoints Ravindra Singh Negi as Managing Director and CEO Nifty fell for the fifth consecutive session on May 30, to close with the losses of 0.95% at 22488. From the recent high of 23110, Nifty has witnessed a fall of almost 700 points towards 22417. 50 days EMA for Nifty is placed near 22380, which can offer support for the short term. On the higher side, 22700 could act as an immediate resistance. Indian markets could open higher, in line with mostly higher Asian markets today and despite negative US markets on May 30

Major U.S. stock indexes rose Friday, with the Nasdaq Composite scoring a fresh record peak ahead of the three-day weekend honouring Memorial Day. US stocks got a degree of relief as University of Michigan data showed consumers expect prices to climb at a 3.3% annual rate over the next year, down from the 3.5% expected earlier in the month. The chances of a Fed interest rate cut were pushed back to the Fed's November FOMC meeting, instead of the first cut occurring in September, according to the CME's FedWatch Tool. China’s industrial profits rose 4.3% year on year in the January to April period (unchanged from Jan-March period), data from the National Bureau of Statistics showed. India's total trade deficit in the last fiscal narrowed to $238.3 billion as against $264.9 billion in the previous fiscal. Asian stocks followed gains in US peers as an easing in US consumer inflation expectations boosted the case for the Federal Reserve to cut rates this year. Adani Ports and Special Economic Zone Ltd (APSEZ) will replace Wipro Ltd in the 30-stock blue-chip S&P BSE Sensex from June 24. GAIL's 10 MW green hydrogen plant in Madhya Pradesh inaugurated Reliance Industries seeks CCI approval for Viacom18-Star India merger Excel Industries enters into a long-term supply agreement with a multinational company After making fresh highs above 23,000 in early trade, Nifty settled flat on May 24. At close, Nifty was down 0.05% or 10.6 points at 22957. The low of May 24 i.e. 22908 should be protected on a closing basis for the rally to continue. Nifty could now face resistance at 23175 while 22794 could provide support in the near term. Indian markets could open mildly higher, in line with mixed Asian markets today and positive US markets on May 24

U.S. stocks finished lower Thursday, with the Dow sliding about 600 points on renewed concerns about the US Fed's next move on interest rates. Stocks retreated as data showing US business activity accelerated amid a pickup in inflation strengthened bets the Federal Reserve will remain on hold. As bond yields rose, the stock market's most interest-rate sensitive segments fell, with the S&P 500's real-estate sector ending almost 2.2% lower, Boeing Co. shares also dropped about 7.6%, creating a major drag on the blue-chip index. Asian stocks tracked Wall Street lower following activity data that signaled the Federal Reserve may keep rates on hold for most of this year. Astral Limited Launches New Paint Line as Astral Paints Tech Mahindra, Fuji TV ink pact to produce content globally L&T Technology Services announces Establishment of Simulation Centre of Excellence for Airbus Nifty ended at record high level on May 23 after the RBI announced a mega dividend to the Govt the previous evening. At close, Nifty was up 1.64% or 369.9 points at 22967.7. Nifty rose the most in percentage terms in almost 6 months on May 23. It could now head towards 23175 on the upside while 22794 could offer support on corrections in the near term. Indian markets could open flat to mildly lower, in line with mostly negative Asian markets today and lower US markets on May 23

U.S. stocks traded lower Wednesday as the minutes from the Federal Reserve’s May meeting raised concerns of persistent inflation, indicating the central bank may not cut interest rates soon. Post market, Nvidia’s results sent its shares as much as 7% higher in after-hours trading. Nvidia said second-quarter revenue will be about $28 billion, beating analysts’ estimates. The company also announced a 10-for-1 stock split and boosted its quarterly dividend by 150% to 10 cents a share. The Reserve Bank of India's (RBI) Central Board of Directors has approved the transfer of Rs 2.11 lakh crores as surplus to the government for the financial year 2023-24. The government had budgeted a dividend of Rs 1.02 lakh crore for 2024-25. BPCL Boosts Aviation Fueling Capabilities with New Hydrant Facilities at Manohar International Airport, Goa. NHPC expects to complete all 4 units of the Parbati-II hydroelectric project by Dec 2024 Karur Vysya Bank has set a target of opening 100 new branches during the current financial year across the country, Asia-Pacific markets were mixed after minutes of the last U.S. Federal Reserve meeting revealed Fed officials’ concerns over persistent inflation, with members seemingly becoming unsure of possible interest rate cuts. Nifty ended a range-bound session on May 22 in the positive. At close, Nifty was up 0.31% or 68.8 points at 22597.8. Nifty settled higher for the fifth consecutive session and recorded its longest winning streak since April 25 Nifty could now rise towards the 22710-22794 band while 22404 can provide support on falls in the near term. Indian markets could open flat, in line with mixed Asian markets today and despite lower US markets on May 22