MarketBuzz
1268: Marketbuzz Podcast with Kanishka Sarkar: Sensex, Nifty 50 headed for muted start, all eyes on RBI MPC policy
Good morning everyone. Welcome back to CNBC TV, 18s Market Bus Podcast. This is your host Kanishka Sarkar bringing you on the top developments ahead of today's trading session. Well, first of all, apart from more details emerging on the government formation front in old-shaking ceremonies due this weekend following the election results, all eyes today will be on the Reserve Bank of India's monetary policy announcement that begins at 10 AM. RBA monetary policy committee is expected to remain on an extended pause and cut interest rates only in October after the Fed cycle starts. The central bank has been indicating that India's monetary policy a reaction function crucially depends on domestic conditions and the US Federal Reserve may not have much of an impact on it. This MPC meeting comes at a crucial time, falling between the recently-controlled Lok Sabha elections and the upcoming full budget in July. This meeting follows a strong GDP growth report for the March quarter and persistent concerns about food inflation. The US Federal Reserve is not inclined to cut rates at this time it seems. Now given these factors, RBA MPC is expected to adopt a wait and watch approach with no immediate reason to rate cuts. All 10 economists polled by XENBCTV18 expect the MPC to leave the repurate unchanged at 6.5% and retain the withdrawal of accommodation stance. All respondents also believe that even a stance change is likely only after August with 80% of them expecting the first straight cut only in October as things stand. Now coming to the stock market, with the exit polls and results now out of the way, the market is set to post gains in a week in which it saw its biggest single day drop in four years and investors' wealth worth 30 lakh crore rupees was wiped out. Such has been the recovery in the NFT over the last two sessions that Tuesday's fall now seems a thing of the past. The recovery has been anything but smooth. During Thursday's training session, foreign investors continued to remain heavy sellers in the cash market while domestic investors were net buyers. The weekly expiry for the NFT turned out to be choppy and even if the index ended about the 2800 mark, it closed trade 90 points of the day's high. This choppiness may persist until more clarity on government formation and who gets which ministry emerges. The fact that this will also be a collision government will be enough to keep uncertainty lingering till a complete picture emerges. Today's session, as I said, will also be all about the RBI Monetary Policy Committee announcement. While the street anticipates the status quo and no change in stance, the focus will be on whether the MPC revises either of the GDP or the inflation estimates for the financial year 2025. On the global front, Asian stocks rose this morning as Wall Street wavered ahead of a key U.S. jobs reading that's likely to guide the Fed's policy outlook. Australian and South Korean stocks rose and equities in Japan was steady while futures in Hong Kong point is higher. The S&P 500 in the U.S. closed little change overnight, having stalled near all-time highs as traders refrained from big bets ahead of U.S. non-farm payroll status. Contracts for U.S. shares were steady in early-Asian trading. U.S. treasuries were steady while Australian needs are lower. Back home, the gift NFT was trading flat indicating a muted start for the Indian market ahead of the MPC outcome. Many stocks to watch out for today. Vipro has won a contract worth $500 million for managed services for some products and industry-specific solutions from a leading U.S. communications service provider. This contract is for a period of over 5 years. ICICI Bank will be in focus as the SEBI has warned the lender on its outreach program around the delisting of ICICI securities. ICICI Bank had undertaken an outreach program to maximize participation of the ICICI securities shareholders in the voting process. SEBI has called this outreach program inappropriate. Meanwhile, UK's Chester Crown Court has ordered Tata Chemicals Europe to pay 1.1 million pounds worth of fine for a safety incident which occurred in 2016. A contractor sustained injuries and subsequently passed away. PB-Fintech chairman and CEO Yashish Thaya has been issued a show cause notice by SEBI over a $2 million investment by a Dubai unit. This $2 million investment was made by PB-Fintech, FZLLC, Dubai for a 26.72% stake in YKNP, marketing management. PB-Fintech said that the show cause notice will have no material impact in financials, operations and other company activities and that the company is seeking legal advice to take appropriate steps. Bijaj Finance and Bijaj Fincer will be in focus as well as the board has approved IPO of Bijaj housing finance of equity shares of 10 rupees each by the company. The IPO will comprise a fresh issue of equity shares worth 4000 crore rupees and an offer for sale of equity shares which is subject to market conditions, applicable approvals, regulatory clearances and others. RBNL meanwhile has received a letter of award from NTPC for being the project execution agency for execution of balance civil and HM works of Bijaj complex including part HRT package of Ramam Hydro-electro-Project Stage 3. Wells Fund Enterprises will also be tracked today as the Delhi High Court Mediation and Conciliation Centre has instructed Indian Oil Corporation to pay the company 15.96 crore rupees towards final settlement of claims and interest of 7.7 crore rupees on or before June 14th. The company had filed a suit before the Delhi High Court against IOC in August 2018 in relation to the Parniput NAFTA cracker project. Hero Motocar Board has approved the purchase of additional shares of up to 2% of 8th her energy for 124 crore rupees and lastly, Mutut microfinance has entered into a strategic co-lending partnership with State Bank of India. With this collaboration, Mutut finance aims to extend its financial services to women entrepreneurs in rural and semi urban regions across India. Well those were the few cues to watch out for today. This is Kanushka Sir Kar signing off. Stay tuned to CNBC TV80 for more news and cues. [Music] [BLANK_AUDIO]