Just when stock markets globally were appearing to be headed for a double dip on scare of a second wave of Covid outbreak, Morgan Stanley put its neck out to predict the fastest rebound for the US economy and Wall Street, which has been cue for emerging markets since they hit their March lows. MS economists say this US recession will be "the steepest but the shortest on record," because this is not an endogenous shock triggered by huge imbalances, deleveraging pressures will be more moderate and policy support has been decisive, sizable and will be effective in boosting the recovery. Based on that theory, MS strategists are actually doubling down on a V-shaped recovery in the economy and earnings.
MARKET CUES: Where do we stand >>>  | Nifty futures on Singapore Exchange traded 98 points higher at 7 am (IST) signalling a major rebound ahead on Dalal Street |
| On Monday, Nifty saw selling pressure, after showing weakness on the weekly charts last week. The index, which had failed to take out the 10,000 level in the previous two sessions, formed an Inside Bar candle on the daily scale. Analysts said Nifty may see further selling pressure should it fall below the 9,726 level. |
| Asian stocks rebounded from their biggest decline since March, boosting investor sentiment in face of worries over a second wave of the coronavirus. Japanese, Australian and Korean shares opened up over 2%. |
| US futures climbed after the Fed detailed plans to buy individual corporate bonds. Key indices on Wall Street erased losses and closed higher in overnight trade. Dow climbed 0.6 per cent, S&P500 added 0.8% and the Nasdaq Composite 1.4%. |
| The rupee depreciated by 19 paise to close at a more than six-week low of 76.03 on Monday as weak domestic equities and sustained foreign fund outflows weighed on investor sentiment. |
| The dollar extended declines and the dollar index fell 0.6% against a basket of currencies. The Japanese yen weakened 0.06%, while sterling last traded 0.10% higher against the greenback |
| Crude oil prices dipped on Tuesday on jitters that a rise in coronavirus infections around the world could hurt fuel demand. Brent crude fell 14 cents, or 0.4%, to $39.58 a barrel while WTI crude slipped 24 cents, or 0.7%, to $36.88 |
| Gold prices fell sharply in Indian markets on Monday, tracking a decline in global rates. In global markets, spot gold fell 0.7% to $1,718.13 an ounce, after the precious metal posted over 2.5% gains in the previous week. Silver fell 1.7% to $17.14, and platinum 0.6% to $800.59. |
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WPI inflation in deflationary zone… Wholesale price inflation entered the deflationary zone for the first time in over four years, reflecting sharp dip in demand due to the lockdown enforced to stem the spread of the coronavirus. Inflation, as measured by the wholesale price index (WPI), contracted 3.2% in May compared to 2.8% growth in the same period in the previous year. This was the sharpest level of deflation witnessed since November 2015, economists said.
Read More Exports contraction slows… The pace of contraction of India's exports slowed in May as relaxations in the lockdown to contain the Covid-19 pandemic led to some pickup in economic activity. The government expects the trend to improve in June on the back of some early indications. Exports in May shrank 36.47% to $19.05 billion against a 60% contraction in April, which was largely due to overseas orders' cancellation. Trade deficit narrowed to $3.15 billion in May as the contraction in imports was sharper. The previous low for trade deficit was March 2016 when it was $2.18 billion.
Read More Surge in applications for distressed realty fund… SBICAP Ventures-managed last-mile fund for stressed real estate projects has received over 100 new applications from realty developers in the last one month, said two persons with direct knowledge of the development. A significant part of these applications seeking financial support have been made during the last 15 days after the fund lowered its return expectations to 12% from earlier 15%-17%.
Read More Hiring picks up in pharma… Hiring by pharma and life-sciences companies has gone up by 7-8% over the last 40 days and is likely to surge up to 25% in the next six months, as they ramp up drug production to meet domestic as well as global demand amid the Covid-19 pandemic, industry experts said. According to a staffing firm catering to the pharma sector, as many as 30,000 vacancies exist across the pharma space, in areas of sales, research and development functions such as in formulation and analytical development, regulatory affairs, production and quality control.
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Sebi show-cause notice to Jhunjhunwala… Sebi has issued a show-cause notice to billionaire investor Rakesh Jhunjhunwala for alleged insider trading in the shares of Aptech, an education and training company owned by him and his family, said two people familiar with the matter. The capital markets regulator is investigating Jhunjhunwala, his family members and other board members of Aptech for trading in the company's shares four years ago. Aptech is the only company in which Jhunjhunwala and family members own a majority stake.
Read More Tatas tighten purse strings… The $113-billion Tata Group has initiated a large-scale cost-cutting exercise across the holding company, Tata Sons, and operating firms as part of an effort to ensure liquidity amid revenue loss caused by the Covid-19 pandemic. The cuts will impact all functions, including finance, marketing, human resources and branding, officials said. The exercise was approved by the Tata Sons board at its June 5 meeting.
Read More Banks not ready to give up interest… Banks have told the regulator and the government that they are opposed to the waiving of interest during the loan moratorium period, said people with knowledge of the matter. Officials from the finance ministry, IBA and the Indian Banks' Association along with a few state-run bank chiefs got into a virtual huddle on Monday to finalise the government's stand in the moratorium case. On June 12, the Supreme Court had told the central bank to meet with the finance ministry to decide whether interest will accrue through the moratorium period or be waived.
Read More Meanwhile... Shoppers stay away from malls… Consumers stayed away from malls in the first week of reopening in parts of India after a two-month gap, with business at 25% of pre-Covid levels despite discounts, cashbacks and promotions, dissuaded by rising Covid-19 infections. Shoppers Stop, H&M and Benetton said high-street shops saw better traction, with sales at 50-60% of pre-lockdown numbers. On the other hand, online sales have surged.
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