Stock market on Monday: Markets opened on a negative note on Monday due to a depressed mood overseas after US inflation hit a 40-year high of 8.6 per cent in May. With a sharp rise in US inflation that beat street expectations, all eyes will be on the US Federal Open Market Committee (FOMC) meeting on Wednesday, June 15, as investors fear aggressive rate hikes. Other than this, India Retail inflation data for May will be released on Monday, June 13.
Massacre on D-Street on Monday Morning
At 10:19 am, the S&P BSE Sensex tumbled over 1,700 points as it slipped below the 53,000 level and the Nifty 50 slipped 500 points below 15,700, the first since March 8.
Top losers and gainers on Nifty
Cipla, Sun Pharma, SBI Life Insurance and Power Grid Corporation were the major gainers on Nifty, while losers were Kotak Mahindra Bank, HDFC, L&T, Hindalco Industries and Infosys.
RBL Bank is down 15%; Hits 52-Week Low
RBL Bank shares fell 15 per cent in early trade after the private bank announced the appointment of veteran banker R Subramaniakumar as its new managing director and chief executive officer. The appointment comes after the former MD and CEO of RBL Bank unexpectedly stepped down, following which the RBI appointed a nominee director on the bank’s board. Most analysts downgraded the stock, noting that the appointment raises more questions than answers, as the veteran banker was previously involved in turning around weak asset quality.
LIC shares at new low
Shares of Life Insurance Corporation of India (LIC) hit a new record low of Rs 682 on BSE in opening deals as the 30-day lock-in period for anchor investors ends today. Anchor investors who have bought more than 59 million shares can sell their shares in the open market from Monday.
10-year bond yield hits 3-year high
The yield on the 10-year bond in the open jumps 8bps to 7.59 per cent. The rise in the yield came amid rising crude oil prices and inflationary concerns around $120 a barrel.
Rupee breaches 78 per US dollar for the first time
The Indian rupee fell to an all-time low on Monday. The Indian currency on Monday opened lower by 30 paise at 78.14 per US dollar, as against 77.84 on Friday.
Why are the markets falling today?
Siddharth Khemka, Head – Retail Research, Motilal Oswal Financial Services said: “Investors will look forward to the upcoming Fed meeting on June 14 and 15. Domestically, rupee depreciation, higher crude oil prices and persistent FII selling head Remains negative. Market is trapped in a broad range for the past one month which is expected to continue till there is no clear direction from either side. While buying in the downside, support at higher levels Is missing. We expect limited stock and sector-specific action. Energy, auto, auto ancillary, select banks, retail, QSR and defense sectors are likely to be in focus.
IIP Data- A Silver Lining?
VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said: “A silver lining is the 7.1 per cent growth in IIP which indicates that the Indian economy is doing well. Therefore, long-term investors can use market downturns to buy higher quality economy-facing stocks, such as the capital goods, banking, telecommunications and export sectors. ,
Watch the biggest weekly drop on US market inflation data
US stocks posted their biggest weekly percentage drop since January and ended sharply lower on Friday as a sharper-than-expected rise in US consumer prices in May sparked fears of more aggressive interest rate hikes by the Federal Reserve. The Dow Jones Industrial Average fell 880 points, or 2.73 percent, to 31,392.79; The S&P 500 closed 116.96 points, or 2.91 percent, down at 3,900.86; And the Nasdaq Composite closed down 414.20 points, or 3.52 percent, at 11,340.02.
Asian stocks fall on rising inflation concerns
Tokyo shares opened lower on Monday, as global inflation concerns rose on fresh US data and weighed down Wall Street, particularly high-tech issues. The benchmark Nikkei 225 index fell 2.63 per cent, or 731.04 points, to 27,093.25 in morning trade, while the broader Topix index fell 2.05 per cent, or 39.86 points, to 1,903.23.
Asian stocks fell on Monday and bond yields ticked higher, as red-hot US inflation raised concerns about an even more aggressive Federal Reserve policy tightening, and a COVID-19 warning from Beijing dented global growth. Added concerns about Chinese blue chips shed 0.84 per cent and Hong Kong’s Hang Seng shed 2.9 per cent. Japan’s Nikkei fell 2.78 per cent and South Korea’s Kospi fell 2.78 per cent.
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