Daily Market Commentary - August 29, 2022 - Bonanza Portfolio

Mr. Vishal Wagh, Research Head, BONANZA PORTFOLIO LTD

Indian indices opened gap-down with Nifty below 17200 on the back of weak global cues. At the time of closing, the Sensex was down 861 points or 1.46% at 57,972, and the Nifty was down 246 points or 1.40% at 17,313.

During the day, Benchmark indices ended lower amid selling across the sectors. FPIs continued to buy equities in August in spite of rising US bond yields and rising Dollars as per NSDL data FPIs bought equity worth Rs. 45,346 cr. through the stock exchange till 26th August. The country's foreign exchange reserves fell $6.7 billion to $564.05 billion in the week ended August 19, according to RBI data. The drop in the reserves was due to a fall in the FCA and the gold reserves. FCA fell by $5.8 billion to $501.3 billion in the reporting week. SEBI suspends trading in cotton futures on MCX for a month.

Profits at China's industrial firms sank in July, reversing previous gains as fresh Covid-19 curbs dragged down demand and squeezed factory margins, while power shortages due to heat waves threatened production. Oil prices were mixed as investors balanced expectations that OPEC will cut output to support prices against concerns. Government bonds and the rupee are expected to see turbulence after the US Federal Reserve pledged to fight inflation with sharper rate hikes.

The rupee breached the 80-to-a-dollar mark to hit a fresh record low while bond yields climbed 6 basis points, tracking a fall in global equities. The U.S dollar extended its rally, hitting a five-week high on the yen. Gold prices hit a more than one-month low, pressured by a robust dollar after U.S. Federal Reserve Chair Jerome Powell signalled continuing with an aggressive monetary policy to tame inflation. On the sectoral front, apart from FMCG and Oil & Gas, all other sectoral indices ended in the red with Bank, Information Technology, Metal, PSU Bank and Realty down 1%-3%.

Nifty 50 top gainers are Britannia Industries, Maruti Suzuki, Apollo Hospitals, Nestle India and Asian Paints. While Tech Mahindra, Infosys, Wipro, HCL Technologies and TCS were among the top losers.

Source : Equity Bulls

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