SGX Nifty down 200 points; here's what changed for market while you were sleeping

Domestic stocks looked set to see a gap-down start on Tuesday, following an overnight steep fall in US stocks amid fears of rising inflation in the world’s largest economy. Asian markets were all in deep red and technical charts for key domestic indices hinted at profit booking ahead.

Here's breaking down the pre-market actions:

STATE OF THE MARKETS
SGX Nifty signals gap-down start
Nifty futures on the Singapore Exchange traded 205 points, or 1.37 per cent, lower at 14,783.50, signalling that Dalal Street was headed for a gap-down start on Tuesday.

Tech View: Nifty likely to see profit booking
Nifty50 formed a bullish Doji kind of candle on Monday, indicating indecisiveness among investors. The trading range was narrower than the previous session, which is likely a hint of a slowdown in the upward journey as well as profit taking. Analysts advised traders to avoid Nifty trades for the time being, considering the narrow trading range, and shift focus to stock-specific opportunities.

Asian markets fall in early trade
Among Asian markets, Japan’s Nikkei plunged 2.73 per cent to 2,8716. Taiwan's TWSE index tanked 2.59 per cent to 16,791.82. Hong Kong’s Hang Seng slumped 2.35 per cent to 27,918. South Korea’s Kospi declined 1.62 per cent to 3,196.94 while China’s Shanghai Composite index fell 0.62 per cent to 3,406.60.

US stocks end higher
In overnight trade, US stocks fell from a record high, as worries about accelerating inflation dragged on shares and hobbled the dollar that struggled at a 10-week low. The S&P 500 index plunged 44.17 points, or 1.04 per cent, to 4,188.43. The Dow Jones Industrial Average retreated 34.94 points or 0.10 per cent to 34,742.82, while the tech-heavy Nasdaq dived 350.38 points or 2.55 per cent to 13,401.86.

Q4 earnings today
Godrej Consumer, Neuland Labs, BASF India: Godrej Consumer Products, Siemens, Aarti Industries, Linde India, BASF India, KEC International, Firstsource Solution, Granules India, Kalpataru Power, Neuland Labs, Alembic, Huhtamaki India and Dishman Carbogen Amcis are among companies that will announce their March quarter results today.

FPIs buy Rs 584 crore worth stocks
Net-net, foreign portfolio investors (FPIs) turned buyers of domestic stocks to the tune of Rs 583.69 crore, data available with NSE suggested. DIIs were net sellers to the tune of Rs 476.26 crore, data suggests.

MONEY MARKETS
Rupee: The rupee rose by 16 paise to close at more than one-month high of 73.35 against the US dollar, marking its third straight session of gains on the back of positive domestic equities and weak American currency.

10-year bonds: India 10-year bond yield marginally lost 0.02 per cent to 6.01 after trading in 6.00 -6.03 range.

Call rates: The overnight call money rate weighted average stood at 3.24 per cent, according to RBI data. It moved in a range of 1.90-3.50 per cent.

MACROS
Banks scale down unsecured loans... Private banks have scaled down their unsecured loans portfolio in the wake of the pandemic last year, which has reduced the risk of defaults during the second wave. Private banks have shifted focus to small business loans that are secured by a government guarantee. This was done under the Emergency Credit Line Guarantee Scheme announced by the government in the wake of Covid. Another segment where banks have been aggressive is home loans, which saw unexpected demand in the fourth quarter despite the pandemic.

LIC eases claim settlement... LIC said that it has eased its claims settlement process in a bid to help customers with the process during the pandemic. The insurer will now allow policyholder to refurbish discharge or death summary issued by hospitals, government or armed forces in relevant cases, counter signed by any Class 1 officer at the insurer as a relevant proof. Earlier death certificates were mandatory for claims process.

Labour reforms pushed to next year... Implementation of big-ticket labour reforms could get pushed to next year as most state governments are going slow on readying the rules framework for implementation of the four labour codes. India Inc also is also reluctant to take on the additional cost and compliance burden under the codes amid the second wave of the Covid-19 pandemic.

US inflation expectations at decadal high… US inflation expectations have surged to the highest in a decade as the economy reopens from COVID-19-related shutdowns, putting investors at odds with the Federal Reserve which sees price pressures still far from its target Inflation expectations as measured by breakevens on Treasury Inflation-Protected Securities (TIPS) over the coming five years jumped to a 10-year high of 2.73 per cent on Monday.

Auto sales slip 28% in April... As lockdowns and mobility restrictions made a comeback across the country due to a massive surge in corona cases, the auto industry saw April sales at retail points scale down substantially, slipping by 28% month-on-month when compared to the numbers achieved in March. No comparison has been made to sales made in the same month last year (April 2020) as the country was under a complete shutdown then after the outbreak of the coronavirus, which saw all auto companies announce ‘zero’ sales.

Crisil says economy tilting to downside... The Indian economy’s growth is “firmly tilted” to a downside in the range of 8.2-9.8% in the ongoing financial year from the current estimate of 11% on account of the second wave of Covid-19, according to rating company Crisil. While weaker growth is expected in the first half of FY22 as the resurgence in infection softens the favourable base effect, the second half would be supported by better vaccination coverage and stronger global growth, the company said in a report on Monday.

Banks slow down micro loans... Lenders are going slow once again on micro finance loans, credit cards and personal loans, as they see these unsecured loans to have become riskier amid the second wave of the pandemic. Performance of these loans is worsening given the low capital cushion and risky nature of such assets, said lenders, who have become extra cautious while providing new collateral-less loans.

Fitch says risks mount for Indian financials... Fitch Ratings said risks to India’s financial institutions are mounting as the second wave of Covid-19 is sapping the economy’s near-term recovery momentum. While the shock to the economy may not be as severe as it was last year, risks of prolonged disruptions and lockdown on account of infections spreading further than previously assumed remain, the American credit rating firm said in a report released on Monday.

China's factory-gate prices surge most in 3 years… China's factory gate prices rose at the fastest rate in three and a half years during April, official data showed on Tuesday. The producer price index (PPI), a gauge of industrial profitability, rose 6.8 per cent from a year earlier, the National Bureau of Statistics said in a statement, compared with a 6.5% rise tipped by a Reuters poll of analysts and a 4.4% rise in March.