MUMBAI: Indian stock markets are likely to remain under pressure on Tuesday, with SGX Nifty futures suggesting a slightly positive start for Indian benchmarks.
On Monday, the BSE Sensex slipped 1,145.44 points or 2.25% to close at 49,744.32 and the Nifty lost 306.05 points or 2.04% before closing at 14,675.70.
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Asian stocks plunged on Tuesday as higher yields on U.S. Treasuries and the outlook for inflation led to a further rotation out of big tech stocks responsible for a major rally on Wall Street during the pandemic.
Oil prices have risen amid tight global supply prospects after US production was hammered by freezing weather and an impending meeting of major crude producers who will likely see production largely under control.
Bond yields rose sharply this month as prospects for another US fiscal stimulus raised hopes for a faster global economic recovery. However, it also fueled inflation expectations, prompting investors to sell growth stocks which drove the stock rally during the pandemic.
The MSCI’s largest Asia-Pacific stock index outside of Japan fell 1.18% on Monday, rising from a record high last week as surging U.S. bond yields confused investors.
Commodity prices rose in part as the US dollar remained weak overall. The dollar index fell 0.287%, with the euro up 0.09% to $ 1.2165. The Japanese yen strengthened 0.06% against the greenback to 104.99 per dollar.
Spot gold added 0.06% to $ 1,809.69 an ounce.
Federal Reserve Chairman Jerome Powell will be giving his biannual testimony to the US Congress starting Tuesday and likely reiterating his commitment to maintaining extremely easy politics for as long as it takes to drive inflation up.
Back home, in a late night notification, Reliance Industries Ltd (RIL) outlined its plans to reorganize its petroleum-chemicals (O2C) business and make it a separate entity that will be 100% owned by RIL. The company headed by Mukesh Ambani said it plans to complete the process by FY22.
The Supreme Court on Monday banned the National Company Law Tribunal (NCLT) from approving the ₹24,713 crore agreement between Future Retail Ltd (FRL) of Kishore Biyani and Reliance Industries Ltd (RIL), after Amazon.com Inc. filed a plea in Supreme Court.
India’s largest wireless operator Reliance Jio Infocomm Ltd is planning to build a data center in Uttar Pradesh for an investment of around $ 950 million, according to a Mint report.
Bharti Airtel Ltd will meet with global fixed income investors on or after February 23 to decide on the issuance of foreign currency bonds, the company said in an exchange brief on Monday. The board of directors of the telecommunications company earlier this month approved the raising of up to Rs7,500 crore through debt instruments such as debentures and single and multi-tranche bonds.
Tata Motors Ltd has placed high hopes on sport utility vehicles to support the growth in sales of its domestic passenger vehicles, a senior company official said. The Mumbai-based automaker on Monday introduced the Safari SUV model, resurrecting the brand’s name, which was discontinued in 2019 after a 21-year stint. The new model will be sold in six and seven seater versions and will be Tata Motors’ flagship vehicle.
(Reuters contributed the story)