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Stock Market Today, Share Market Updates: The topline equity indices opened over 1.5 per cent higher on Friday taking cues from their Asian peers which rose after China cut a key lending benchmark to support a slowing economy.

At 9:24 am, the S&P BSE Sensex was up 1,006.38 points (1.91 per cent) at 53,798.61 while the Nifty 50 was trading at 16,122.55, up 313.15 points (1.98 per cent).

On the Sensex pack, all the stocks were trading higher in the early trade led by Tata Steel, Dr. Reddy’s Laboratories, Bharti Airtel, State Bank of India (SBI), Sun Pharmaceutical Industries and Hindustan Unilever(HUL).

Speaking on the sharp market movements, V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services said, “The excessive volatility in the market is broadly due to two reasons. One, the market has discounted severe monetary tightening by the Fed which is likely to take the Fed funds rate to around 3 per cent in 2023. Two, the market has not fully discounted the probability of the US economy slipping into recession in 2023. Till there is clarity on the second issue, the ‘risk-off, risk-on mode’ in the market is likely to continue in the near-term. It may take a few weeks for the markets to stabilize.”

On the global front, he noted “It is important to appreciate the fact that the dominant feature of this market is bearish in the short-term. Nasdaq is 30 per cent down from the peak and S&P 500 is 19 per cent down from the peak. These are reflections of weakness in the market.”

For India, Vijayakumar said that the foreign institutional investors (FIIs) are likely to continue selling since India is the only emerging market where they are sitting on good profits and the market provides the liquidity to sell.

Global market

Asian shares jumped in early trade on Friday after China cut a key lending benchmark to support a slowing economy, but a gauge of global equities remained set for its longest weekly losing streak on record amid investor worries about sluggish growth. China cut its five-year loan prime rate (LPR) by 15 basis points on Friday morning, a sharper cut than had been expected, as authorities seek to cushion an economic slowdown, though it left the one-year LPR unchanged. The five-year rate influences the pricing of mortgages.

MSCI’s broadest index of Asia-Pacific shares outside Japan quickly built on early gains after the cut, and was last up 1.4 per cent. Chinese blue-chips were 1.1 per cent higher in early trade and Hong Kong’s Hang Seng index jumped more than 2 per cent, while Australian shares rose 1.3 per cent. In Tokyo, the Nikkei stock index gained 1 per cent.

The gains in Asia came after a late rally on Wall Street petered out, leaving the Dow Jones Industrial Average down 0.75 per cent, the S&P 500 0.58 per cent lower and the Nasdaq Composite off by 0.26 per cent.

-global market input from Reuters




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