Dear Trader…
Indian equity benchmarks continued their weak trade in today's session due to weak global cues as US central bank projected at least two interest rate hikes in 2023, a year earlier than forecasted in the March meeting. Sentiments were also fragile as foreign institutional investors (FIIs) stood as net sellers in the capital market as they offloaded shares worth Rs 870.29 crore on June 16, as per provisional exchange data.
Some anxiety also came with RBI’s article stating that bank deposits and currency holding with the public have been adversely impacted during the second COVID wave, indicating a heavy outgo towards pandemic-induced medical expenditure. On the global front, Asian markets were trading mixed after Federal Reserve officials sped up their expected pace of policy tightening.
Nifty futures opened at 15671.05 points against the previous close of 15790.20 and opened at a low of 15626.00 points. Nifty Future closed with an average movement of 151.60 points and a decline of around 109.25 points and 15680.95 points .. !!!
On the NSE, the midcap 100 index will decline 1.23% and smallcap 100 index is closing decline 0.53%. Speaking of various sectoral indices, the NSE saw gains in FMCG and IT stocks, while all other sectoral indices closed lower.
At the start of intra-day trading, august gold opened at Rs.48250, fell from a high of Rs.48250 points to a low of Rs.47420, with a decline of 1001 points, a trend of around Rs.47505 and July Silver opened at Rs.71000, fell from a high of Rs.71000 points to a low of Rs.69363, with a decline of 1962 points, a trend of around Rs.69506..!!
Meanwhile, The Reserve Bank of India (RBI) article has said that bank deposits and currency holding with the public have been adversely impacted during the second COVID wave, indicating a heavy outgo towards pandemic-induced medical expenditure. It noted that bank deposits -- having a share of around 55 percent in total assets of households -- decelerated by 0.1 percent at end-April 2021 on a m-o-m (month-on-month) basis as against a growth of 1.1 percent in April 2020.
It also stated that currency holding with the public has also decelerated significantly to 1.7 percent during April 2021 in comparison to the growth of 3.5 percent a year ago, implying heavy outgo towards COVID-induced medical expenditure. It said the rate of decline in bank deposits vis-a-vis bank credit has also been higher, indicating that this time around the banking sector component of household savings declined.
According to preliminary estimates by RBI, the household financial savings in Q3:2020-21 have come down to 8.2 per cent of GDP from 21 per cent and 10.4 per cent in the previous two quarters. The savings of High Networth Individuals (HNIs) and retail individuals in liquid funds surged sharply in Q1:2020-21, mirroring the impact of uncertainty amidst COVID-induced lockdown. Households also parked their funds in gold Exchange Traded Funds (ETFs).
Technically, the important key resistances are placed in Nifty future are at 15707 levels, which could offer for the market on the higher side. Sustainability above this zone would signal opens the door for a directional up move with immediate resistances seen at 15737 – 15777 levels. Immediate support is placed at 15606 – 15530 levels.
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