Indian equity markets fell yesterday, tracking weakness in Asian equities after crude oil prices spiked amid escalating tensions in West Asia after a US airstrike killed a top Iranian commander.
At the closing, the benchmark Sensex was 0.39% or 162.03 points lower at 41,464.61 points, while Nifty fell 0.45% or 55.55 points to 12,226.65 points.
Crude oil surged over 3.5% after a US airstrike killed a top Iranian general. The death of Qassem Soleimani, who led the Revolutionary Guards’ Quds force, heightened fears of an armed conflict between the US and Iran that could easily pull in other countries, a Bloomberg report said.
“Oil is likely to be on boil. Bad for large oil importing countries especially those with large trade and current account deficit like India. Indian equities better take note. Risk aversion would spike sharply,” said Ajay Bodke of Prabhudas Lilladher.
Oil marketing and paint companies fell as crude oil surged. Hindustan Petroleum Corp fell 2.3%, Bharat Petroleum Corp lost 1.2%.
Asian Paints fell 2.1%, Berger Paints decreased 0.4%, and Kansai Nerolac Paints Ltd lost 1.6%.
Information technology stocks gained after the rupee weakened to a one-month low. HCL Technologies gained 1.7%, TCS rose 2%, Tech Mahindra 1.2%, Infosys Ltd 1.48%, Wipro Ltd 1.05%.
Infrastructure stocks extended its gains on expectations that they will benefit from the government’s push to build roads, railways and other public works, outlined by the government. IRB Infrastructure Developers gained 2.6%, Jai Corp Ltd 8.4%, Reliance Industrial Infrastructure Ltd 20%, GMR Infrastructure Ltd 5%.
The first two days of 2020 saw gains with the overall market sentiment reviving after the government more than doubled infrastructure capex plan for the next five years and following the announcement of the US-China deal signing date and Beijing easing monetary policy to support slowing growth.
“Going ahead, markets would be looking ahead for the December quarterly results and any significant developments from the government before the Union Budget,” said Motilal Oswal in a note to its investors.
Meanwhile the Indian rupee yesterday closed at a six-week low against the US dollar following a spike in international crude oil prices amid escalating tensions in West Asia.
The domestic currency ended at 71.81 a dollar, a level last seen on November 20, down 0.59% from Thursday’s close of 71.37. The Indian unit opened at 71.62 a dollar and touched a low of 71.83.
Government bond yields fell after Reserve Bank of India announced its third ‘operation twist’. The RBI plans to buy three bonds for a combined Rs10,000 crore on January 6.
The 10 year bond yield was trading at 6.497% from its previous close of 6.503%.
Since April 1, the rupee has weakened 3.8%, while foreign investors have bought nearly $6.08bn in Indian equities and $2.22bn in debt.
The benchmark equity index Sensex fell 0.39% or 162.03 points to closed at 41,464.61 points. Since April 1, it has gained 7.64%.
Asian currencies were trading lower. South Korean won was down 0.48%, Philippines peso 0.31%, Malaysian ringgit 0.25%, Singapore dollar 0.12%, Indonesian rupiah 0.12%, China Offshore 0.06%, Taiwan dollar 0.05%. However, the safe-haven Japanese yen was up 0.45%. Hong Kong dollar fell 0.08%.
The dollar index, which measures the US currency’s strength against a basket of major currencies, was at 96.745, down 0.11% from its previous close of 96.846.
from Gulf Times https://ift.tt/2SPg3nm
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