Indian markets could continue to consolidate; Jet Airways, PSU banks in brief

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MUMBAI: Indian stocks will likely continue to see consolidation on Monday, with trends on SGX Nifty suggesting a flat opening in national benchmarks.

On Friday, the 50-stock Nifty index closed at 14,981.75, down 137.20 points or 0.91%. The BSE Sensex finished at 50,889.76, down 434.93 points or 0.85%.

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Asian stock markets edged up on Monday as expectations of faster economic growth and inflation around the world hurt bonds and boosted commodities, though rising real yields have made stock ratings more strained in comparison.

Bonds have been shattered by the prospect of a stronger economic recovery and even bigger borrowing as US President Joe Biden’s $ 1.9 trillion stimulus package progresses.

Federal Reserve Chairman Jerome Powell will be giving his semi-annual testimony to Congress this week and will likely reaffirm his commitment to keep politics very easy for as long as it takes to drive inflation up. European Central Bank President Christine Lagarde is also expected to appear conciliatory in a speech later Monday.

Back home, the consortium comprising asset management firm Kalrock Capital and entrepreneur Murari Lal Jalan, who are currently awaiting approval from the National Company Law Tribunal (NCLT) to restart the operations of Jet Airways (India) Ltd , plans to keep the airline as a publicly traded company. The consortium hopes to restart operations within four to six months of court approval, which is expected to hear the resolution plan on Monday.

Public sector banks (PSBs) are exploring the idea of ​​starting a business to build and share digital infrastructure in response to the rapid digital adoption in banking due to the pandemic, according to a report from the Mint.

The government may consider privatizing Oriental Insurance or the United India Insurance Co, as their financial health has improved after a series of capital injections, according to a PTI report.

The Punjab National Bank (PNB) will not participate in the fundraising plans of its housing finance subsidiary, PNB Housing Finance, but the company will continue to seek equity from other sources, according to a regulatory filing. In August last year, PNB Housing Finance Ltd had notified of its intention to raise Tier I capital up to 1800 crore through different modes including QIP, preferential issue of shares or issue of rights.

Meanwhile, 10-year Treasuries yields have already reached 1.38%, breaking the psychological level of 1.30% and taking the rise for the year so far to 43 basis points.

Oil prices followed the run, helped by tight supplies and freezing weather, giving Brent 22% gains for the year so far.

Early Monday, Brent futures rose another 50 cents to $ 63.41 a barrel, while US crude added 45 cents to $ 59.69.

The US dollar index was relatively limited, with downward pressure from the country’s growing double deficit offset by higher bond yields. The index was the last at 90.341, not far from where it started the year at 90.260.

Gold is a commodity that is not doing as well, partly because of rising bond yields and partly because investors are wondering if cryptocurrencies could be a better hedge against inflation.

The precious metal was valued at $ 1,786 an ounce, having started the year at $ 1,896. Bitcoin was down 1.8% on Monday at $ 56,403, but started the year at $ 19,700.

(Reuters contributed the story)

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