Post Market views - April 20, 2022 - Reliance Securities

Mr Mitul Shah, Head Of Research at Reliance Securities.

Domestic equities moved in tandem with global markets and recouped gains after a nosedive in the previous trading session. Nifty gained 1.1%, while broader markets underperformed in comparison to the main indices. Nifty MidCap was up 0.9% and Nifty SmallCap was almost flat. Most sectoral indices ended in green. Nifty Auto gained the most at 2.3% followed by Nifty IT and Nifty FMCG which increased 1.3% and 1% respectively. Nifty Media was the major laggard which dropped 0.5%. Meanwhile, investors await on earnings reports from India Inc for further cues and kept tabs on the developments of the Russia-Ukraine war and rising COVID infections in China.

U.S. equities ended higher with positive earnings momentum. The S&P 500 gained 1.7%, the Nasdaq gained 2.2%, while the Dow Jones rose 1.5%. The 10-year Treasury yield rose 5 basis points to 2.91%, hitting a new three-year high. Data suggested that slightly more than 79% of the 49 companies in the S&P 500 index which reported quarterly earnings so far, exceeded profit estimates. Moreover, U.S. crude oil prices tumbled 5.2% to $102.6 a barrel after the IMF cut down growth forecasts for the global economy and warned of higher inflation.

As the Q4 season is underway, the markets would be closely monitoring the earnings and management commentary, for the next few weeks. Moreover, trend in global markets, the movement of rupee against the dollar and crude oil prices will also influence the equity markets in the near term. The world continues to witness the developments on the Russia-Ukraine war, which is disrupting. Over the near-term, war issue and sanctions on Russian products would have high negative bearings on global and Indian equities. The markets are likely to see gap up opening, SGX nifty is up 64 points compared to yesterday's spot Nifty closing. Asian markets trading mix (Nikkei is up 0.4%, while Hang seng is down 0.34%).

Source : Equity Bulls

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