Trend is a friend in financial markets as per the Dow Theory. Yet, the ongoing trend in key global markets is failing to instill confidence among investors and traders, as they are increasingly getting worried about the major disconnect stocks have developed with the macro economy. Yet, even the broader market is showing strength on Dalal Street. The April-June quarter rally delivered highest quarterly gains for midcaps and smallcaps since 2014, indicating a structural turnaround. As one brokerage pointed out, the positive thrust in market breadth and expanding volumes give confidence that the worst is behind us.
MARKET CUES: Where do we stand >>>  | Nifty futures on Singapore Exchange traded 57 points higher at 7 am (IST) signalling a positive start ahead for Dalal Street |
| Nifty reclaimed the 10,400 mark on Wednesday after four days' consolidation, formed a bullish candle on the daily chart and made higher highs for lows. Analysts said it has seen a breakout of the consolidation range of last four sessions, but requires follow-up action to start the next leg of rally. |
| Asian stocks saw modest gains on Thursday after positive vaccine developments. Shares edged higher in Hong Kong despite the recent tensions over China's new national security law. Australia and South Korea also rose. Tokyo gains faded on reduced volumes. Shanghai saw a muted start. |
| The S&P500 closed 0.5% higher overnight, as improving jobs and manufacturing data and positive coronavirus vaccine news boosted investor sentiment. The Nasdaq added 0.95% to close at a record high, but the Dow fell 0.3%. |
| The rupee settled 9 paise lower at 75.60 against the US dollar on Wednesday as concerns over rising Covid-19 cases weighed on investor sentiment even as the domestic equity market was trading in the positive territory. |
| The dollar was on the defensive against more growth-sensitive currencies on Thursday, following upbeat US and European economic data. Sterling traded flat and the euro maintained its gain since the start of week. |
| Oil prices dipped on Thursday after the US recorded its biggest one-day spike in coronavirus cases. WTI crude futures fell 10 cents, or 0.3%, to $39.72 a barrel while Brent futures eased 6 cents, or 0.1%, to $41.97. |
| LOOK WHO'S |  |
Economy rebound gathers pace… The Indian economy gathered pace in June with goods movement rebounding close to prelockdown levels and GST collections rising sharply from May. Electricity consumption rose and demand for employment under the MNREGA Scheme fell, suggesting better industrial demand for labour. Bank credit rose Rs 32,022 crore in the fortnight ended June 5. GST collections recovered to ₹90,917 crore in June from ₹62,009 crore in May and ₹32,294 crore in April, reflecting a rise in consumption. The manufacturing PMI recovered to 47.2 in June from 30.8 in May. A reading above 50 on this survey based index reflects expansion.
Read More Auto firms see sharp rise in demand… Auto and two-wheeler companies clocked sharp month-on-month sales increase in June as pent-up demand and revival in economic activity drove purchases of sedans, SUVs and motorbikes across the country. Three large companies, Hero MotoCorp, Mahindra & Mahindra and TVS Motor came close to achieving 100% of the pre-Covid-19 sales numbers of February. Industry leader Maruti Suzuki posted a nearly four-fold month-onmonth increase in June numbers with year-on-year sales falling 53%.
Read More Tesla now highest-valued auto firm… Tesla Inc on Wednesday became the highest-valued automaker as its shares surged to record highs and the electric carmaker's market capitalisation overtook that of former frontrunner Toyota Motors. Tesla shares gained 5% in early morning trade to a record $1,133, boosting its market cap to $209.47 billion — roughly $6 billion more than that of Toyota. Tesla is now worth more than triple the combined value of US automakers General Motors and Ford Motor.
Read More Gold price tops Rs 50,000 in India… A strong global demand for gold, along with a depreciating rupee, helped the yellow metal to breach the Rs 50,000-per-10gm mark in Mumbai's retail market on Wednesday. This is the first time the price of the precious metal, with which Indians associate sentimentally, crossed the psychologically important level. At the same time, on leading commodities bourse MCX, the price was hovering just below the Rs 49,000 mark for contracts that will expire in August's first week.
Read More FPI investment fund norms eased… India has eased eligibility criteria for investment funds set up by category-I FPIs, such as sovereign funds, pension funds and regulated entities including offshore banks, to avail tax benefits retrospectively from September 23, 2019. These Sebi-registred funds do not need to adhere to certain conditions – having minimum 25 members, none having more than 10% participation interest and aggregate participation interest of 10 members not exceeding 50% – to benefit from India's special taxation regime.
Read More | AND WHO'S |  |
MSCI defers raising India weight… Global index management company MSCI has deferred raising India's weightage in global indices, theoretically delaying fund inflows from bulge-bracket offshore money managers that typically use the gauges to allocate investment wallets across multiple geographies. By some estimates, about Rs 10,000 crore worth of short-term passive inflows and Rs 40,000 crore in potential active inflows could be affected by the deferral.
Read More Sebi probes big rally in Ruchi Soya, Alok Ind… Sebi is probing into the recent jump in the share prices of Ruchi Soya Industries and Alok Industries. The capital market regulator has sought details of unusual trades in the two stocks from stock exchanges, said two people familiar with the matter. BSE and NSE declined to comment while Sebi did not respond to an email query.
Read More No breakthrough in talks on Galwan standoff… India and China have broadly agreed to restart the gradual and verifiable troop disengagement from "friction points" in Galwan Valley and Gogra-Hot Springs areas of eastern Ladakh, which got derailed the last time after Chinese soldiers reneged on the pullback agreement, leading to the bloody clashes on June 15. However, there has been no breakthrough yet on defusing the major troop confrontation at Pangong Tso, where PLA soldiers have built a large number of fortifications and taken the dominating heights.
Read More Close vigil on power tendering… The government is keeping a close watch on the tendering of the Rs 55,000 crore emission control equipment by the thermal power sector that has placed large orders on Chinese companies in the past. Most private and various state power companies are in discussions with Chinese companies for the emission control gear. Power utilities of states like Uttar Pradesh, Punjab, Haryana, Tamil Nadu, Karnataka and Maharashtra have sought global bidders for procurement against the Centre's public procurement norms.
Read More Meanwhile... Chinese banks slow down India loans… Top Chinese banks in India, Industrial and Commercial Bank of China (ICBC) and the China Development Bank (CDB), have considerably slowed their large-ticket term-loan advances in the country after bad loans surged in their portfolios that had included advances to the subsequently distressed companies such as IL&FS Transportation and Aircel. Charge filings with the Ministry of Corporate Affairs, compiled by data intelligence provider Propstack, show that ICBC and CDB have not disbursed any large-ticket term loan in India since 2018.
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