The market saw its biggest one-day fall in 2019 on June 6 as bears smashed the bulls right from the onset as the RBI did not make any announcement to tackle liquidity stress facing by NBFCs.
The market was also worried about banks’ loan exposure to DHFL which defaulted on debt repayment on June 4.
After a 25 bps rate cut by the central bank and change in policy stance to accommodative from neutral, traders might have chosen to book profits as the market had seen a one-way rally after election results, experts said, adding 11,600 would be crucial level to watch out for in coming days.
The BSE Sensex plummeted 553.82 points to close at 39,529.72 while the Nifty50 fell 177.90 points to 11,843.80 and formed ‘Bearish Belt Hold’ pattern on daily charts.
According to the Pivot charts, the key support level is placed at 11,769.4, followed by 11,695. If the index starts moving upward, key resistance levels to watch out are 11,979 and 12,114.2.
The Nifty Bank index closed at 30,857.40, down 731.65 points on June 6. The important Pivot level, which will act as crucial support for the index, is placed at 30,591.64, followed by 30,325.87. On the upside, key resistance levels are placed at 31,332.34, followed by 31,807.27.
Stay tuned to Moneycontrol to find out what happens in currency and equity markets today. We have collated a list of important headlines from across news agencies.
Wall Street rises with hopes of Mexican tariffs delay
Wall Street’s main indexes closed higher after a choppy session on Thursday as investors grew more optimistic on trade after reports that the United States is considering a delay in imposing tariffs on Mexican imports.
The Dow Jones Industrial Average rose 181.09 points, or 0.71%, to 25,720.66, the S&P 500 gained 17.34 points, or 0.61%, to 2,843.49 and the Nasdaq Composite added 40.08 points, or 0.53%, to 7,615.55.
Asia shares dazed by trade uncertainty, US jobs risks
Asian share markets dithered on Friday as investors waited for concrete signs of progress in the US-Mexican trade standoff, while bracing for a US jobs report that could sway the course of interest rates there.
MSCI’s broadest index of Asia-Pacific shares outside Japan edged 0.04% higher and looked set for another cautious session being up just 0.6% for the week so far. Japan’s Nikkei firmed 0.3%, but South Korea slipped 0.5%. E-Mini futures for the S&P 500 were mostly flat.
Trends on SGX Nifty indicate a negative opening for the broader index in India, a fall of 24.5 points or 0.21 percent. Nifty futures were trading around 11,859 – level on the Singaporean Exchange.
Oil prices extend gains, move further away from 5-month lows
Oil prices rose around 1% on Friday to move further away from five-month lows hit earlier in the week, buoyed by a report that Washington could postpone trade tariffs on Mexico and signs OPEC and other producers may extend crude supply cuts.
Brent crude futures were up 50 cents, or 0.8%, at $62.17 a barrel by 0041, having risen earlier to $62.41. They gained 1.7% on Thursday. US West Texas Intermediate crude futures were up 50 cents, or 1%, at $53.09 per barrel, after trading as high as $53.33. They finished the previous session 1.8% higher.
Rupee ends almost flat at 69.28 against dollar
The Indian rupee recouped most of its early losses and closed marginally lower at 69.28 to the US dollar after the Reserve Bank in a widely expected move cut key interest rates by 0.25 percentage point. To boost the sagging economy, the RBI June 6 lowered its benchmark lending rate to a nearly nine-year low of 5.75 percent and changed its monetary policy stance to accommodative, leaving space for future rate cuts.
After opening on a weak note at 69.41 at the interbank forex market, the Indian unit fell further to 69.45 against the US currency. Following the RBI’s Monetary Policy Committee (MPC) decision, the local currency recovered most of the lost ground and settled for the day at 69.28, down 2 paise over its previous close. The rupee had settled at 69.26 against the US dollar Tuesday.
SAT rejects NSE plea for bank guarantee to Sebi in co-location case
Securities Appellate Tribunal (SAT) June 6 rejected NSE’s plea for allowing it to provide bank guarantee instead of transferring Rs 687 crore from escrow account to Sebi in co-location case.
The tribunal, however, granted an additional week to the exchange to comply with the May 22 order which directed NSE to transfer Rs 687 crore to Securities and Exchange Board of India (Sebi) within two weeks from the escrow account.
“In our view, we do not find any reason to modify our order dated May 22, 2019. The appellant (NSE) should transfer the amount which is already kept in the escrow account as per the interim order of Sebi to be transferred to Sebi account as per our order dated May 22, 2019,” SAT said while rejecting NSE’s plea.
US tightens Venezuela oil sanctions, indicates more actions to come
The US Treasury Department on Thursday tightened its pressure on Venezuela’s state-owned oil company by making clear that exports of diluents by international shippers could be subject to US sanctions.
The change, announced on the Treasury Department’s website, is the latest US measure aimed at pressuring Venezuelan President Nicolas Maduro by limiting access to oil export revenue from PDVSA.
Investors lose Rs 2.22 lakh cr as equities plunge
Investor wealth eroded by Rs 2.22 lakh crore June 6 as markets recorded their biggest single-day fall this year after RBI delivered a rate cut on expected lines, but failed to assuage concerns regarding the NBFC sector. The 30-share BSE Sensex plummeted 553.82 points, or 1.38 per cent, to close at 39,529.72.
Tracking weak sentiment in the broader market, the market capitalisation (m-cap) of BSE-listed companies tumbled Rs 2,22,304.65 crore to Rs 1,53,19,126.66 crore.
RBI pushes for retail participation in state government bonds
In a move that is expected to broaden the scope of the sovereign debt market, the Reserve Bank of India (RBI) has focused on increased retail participation. The regulator asked stock exchanges to act as facilitators or aggregators of bids of their stockbrokers or other retail participants. Further, these bids are to be submitted as a single consolidated bid under the non-competitive segment of the primary auctions of State Development Loans (SDL).
SDLs are bonds issued by various state governments from time to time to fund their fiscal deficit. The gap between States’ revenues and expenses is funded by borrowing from institutions such as life insurance companies, mutual funds and the employee provident fund.
Three stocks under F&O ban period on NSE
For June 7, DHFL, IDBI Bank and PC Jeweller are under the F&O ban period. Securities in ban period under the F&O segment include companies in which the security has crossed 95 percent of the market-wide position limit.