Morning Update: Sensex gains, at 67227 level: While Nifty at 19950 level

 Indian Market 

FII AND DII 

 Indian Market News

1. The GIFT Nifty is off to a good morning; US markets are divided, but Asia is up.
2. Nikkei, Taiwan, and other Asian markets are trading higher. Weighted by 1%, 
3. S&P 500 finishes up as CPI data cements predictions on a Fed pause.
4. Oil prices rise as markets focus on supply scarcity.
5. As the ECB decision approaches, the dollar remains above its three-month low against the euro.
6. Samhi Hotels obtains Rs 616.54 crore through an anchor book in advance of its IPO.
7. JSW Infrastructure IPO will begin on September 25 with a fresh offering of Rs 2,800 crore.
8. Larsen & Toubro’s Rs 10,000 crore share purchase program will begin on September 18 and end on September 25.
9. Bombay Dyeing will sell 22 acres of land in Worli to a Sumitomo Group subsidiary for Rs 5,200 crore.
10. ACC begins commercial clinker production at the Ametha cement facility.

Global Market Check

GIFT Nifty

The GIFT Nifty index started slightly positive with a 33-point gain, while futures reached 20,167 points after reaching a high of 20,174 points.

US Markets

Stock futures remained near the flat line on Wednesday as traders prepared for the August producer price index, a measure of wholesale inflation.

The Dow Jones Industrial Average added 11 points or 0.03%, while S&P 500 futures ticked up 0.09%.

Nasdaq 100 futures inched 0.1% higher.

The core consumer price index (CPI) gained 0.3% from the prior month and 4.3% from 12 months earlier, compared to estimates of 0.2% and 4.3%, respectively.

Headline inflation increased 0.6% on a monthly basis and 3.7% from the prior year.

The August CPI reading is not expected to change the Federal Reserve’s course at its policy meeting beginning Sept. 19.

Fed funds futures pricing data shows a 97% likelihood of rates remaining unchanged next week, but markets are likely to remain volatile in the coming months.

European Markets

European stock markets closed slightly lower on Wednesday due to stronger than expected U.S. inflation data.

The Stoxx 600 index fell by 0.3%, with sectors and major bourses in negative territory.

Retail stocks dropped 0.9% to lead losses.

U.S. inflation data for August exceeded expectations, with the consumer price index rising 3.7% from a year ago.

Core CPI, which excludes food and energy, rose by 0.3% on the month and 4.3% on the year, in line with expectations.

  Asian Markets

Asia-Pacific markets experienced growth despite higher US inflation rates in August, reaching 3.7%.

The consumer price index rose 0.6% in August, in line with expectations.

The core CPI rose 4.3%, down from 4.7% in July.

Federal Reserve officials focus on core inflation as it provides a better indication of long-term trends.

The S&P/ASX 200 in Australia climbed marginally, ahead of August unemployment figures.

Japan’s Nikkei 225 rose 0.5%, while the Topix saw a smaller gain of 0.4%.

South Korea’s Kospi increased 0.43%, and the Kosdaq was 0.84% higher.

Hong Kong’s Hang Seng index futures stood at 18,042, indicating a stronger open compared to the HSI’s close of 18,009.22.

Oil Prices

Oil prices rose on Wednesday due to expected tight crude supply for the rest of the year, which offset inflation concerns. The International Energy Agency (IEA) reported that Saudi Arabia and Russia’s extension of 1.3 million barrels per day of crude oil production cuts will lock in a substantial market deficit through the fourth quarter. The continuing supply cuts could lift Brent futures above the $100 a barrel threshold before the end of the year. U.S. consumer prices rose in August by their most in over a year, driven by a 10.6% increase in retail gasoline prices. Benchmark Brent futures rose 40 cents to $92.46 a barrel, while U.S. West Texas Intermediate crude gained 41 cents to $89.25. The European Central Bank is expected to raise interest rates at its meeting on Thursday.

Dollar Index

The Dollar index closed 0.06 percent lower in futures at 104.65, while the dollar’s value was near Rs 83.09.

Gold Prices

Gold remained steady on Wednesday after a surge in U.S. consumer prices, indicating that inflation readings may not significantly change the Federal Reserve’s interest rate strategy. Spot gold was at $1,912.86 per ounce, while U.S. gold futures were at $1,935.40 per ounce. Labor Department data showed headline and core CPI in August rose 0.6% and 0.3%, respectively, month-on-month. However, traders’ expectations for the Fed to leave interest rates unchanged at its Sept. 19-20 policy meeting increased after the data, with a 44% chance of another hike before 2024. Precious metal investors are now focusing on retail sales numbers, which some believe is a more important indicator than the CPI data.

News Updates

The madcap run that has triggered the mid-cap fall in five charts

The sudden and steep cut in mid-cap stocks has caused panic among investors, with some segments of the market running ahead of their fundamentals. This is partly due to investors trying to chase the performance of mid-caps and small-caps, leading to an avalanche of fund flows into these categories of equity funds. Stock valuations have zoomed in certain pockets that promise high growth. Over the last four months, mid-cap and small-cap funds of domestic equity mutual funds have seen inflows of Rs 215 billion, while large-cap and flexi-cap funds have seen outflows of Rs 60 billion. This is considered exuberance by Kotak analysts.

Adani in talks for $3.5 billion, one of top Asia loans this year

Adani Group is in talks with banks to refinance debt taken on to fund its purchase of Ambuja Cements Ltd. This could be one of Asia’s largest syndicated loan deals of the year. Banks are likely to refinance a total of $3.5 billion, with Adani repaying at least $300 million on the original Ambuja facility. The Indian conglomerate, backed by billionaire Gautam Adani, has been in talks with lenders for several months to refinance up to $3.8 billion worth of debt taken for its Ambuja acquisition. DBS Group Holdings Ltd., First Abu Dhabi Bank PJSC, Mizuho Financial Group Inc, Mitsubishi UFJ Financial Group, Inc., and Sumitomo Mitsui Banking Corp. will each lend around $400 million.

Reliance Retail in talks with Gulf, Singapore funds on $1.5 billion injection

India’s Reliance Retail is in talks with sovereign wealth funds of Singapore, Abu Dhabi, and Saudi Arabia for a combined $1.5 billion injection. The talks are part of an internal target to raise $3.5 billion, which the company aims to close by the end of September. QIA recently announced a $1 billion investment, while KKR & Co recently received $250 million. Singapore’s GIC, the Abu Dhabi Investment Authority (ADIA), and Saudi Arabia’s Public Investment Fund (PIF) are looking to invest at least $500 million each in Reliance Retail at a valuation of $100 billion. Reliance Retail has declined to comment on media speculation and rumors.

STOCK IN NEWS 

• Bombay Dyeing and Manufacturing Company: The business has given the go-ahead to sell a 22-acre land plot in Worli, Mumbai, in two phases for Rs 5,200 crore to Goisu Realty Private Limited, a division of Sumitomo Realty & Development Company Limited. About Rs 4,675 crore from Phase I and the remaining from Phase II will go to BDMC.

• Venus Remedies: The business declared that the Department of Scientific and Industrial Research (DSIR), an Indian government agency, has recently registered it. This will make it easier for the business to get customs duty exemptions.

   

   

• Wipro: In Dusseldorf, Germany, the IT services provider opened its Cyber Defence Centre (CDC). The CDCs of Wipro are spread out over the world to offer localised support and to meet the cybersecurity and compliance needs of their clients.

   

• Vinati Organics: The business has contributed Rs 11,16,00,000 to the rights issue of Veeral Organics, a completely owned subsidiary, by subscribing to an additional 1,11,60,000 fully paid-up equity shares with a face value of Rs 10 apiece at par.

• NBCC (India): The state-owned business has agreed to a quadripartite MoU for the monetization of Rashtriya Ispat Nigam’s non-core assets in Vishakhapatnam with the Central Government, RINL, and NLMC. According to the agreement, NBCC would serve as a technical cum transaction advisor and help the Ministry of Steel (MoS), RINL, and NLMC monetize the Vishakhapatnam-based non-core assets of RINL.

• Shree Cement: The proposed Non-Convertible Debentures (NCDs) rating of Rs. 700 crore has been reaffirmed by CARE Ratings as CARE AAA.

• Filatex Fashions: 197 investors, including promoters, institutions, and private investors, contributed a total of Rs 2,211 crore to the company’s approval of the allotment of 157 crore shares at Rs 14.08 per share. The promoter Prabhat Sethia and Madhusudan Securities are significant investors.

• NIIT: In partnership with Century 21 Heritage Group, NIIT Canada, a fully owned subsidiary of NIIT Learning Systems, announced the successful launch of its Xsel Learning platform. According to the business, the introduction of Xsel represents a significant development in real estate education pedagogy and technology and brings cutting-edge digital learning solutions to the CENTURY 21 Heritage Group.

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