INSUBCONTINENT EXCLUSIVE:
NEW DELHI: The global trade wars are back, and this time scarier than before
While the denuclearisation deal between the US President Donald Trump and North Korean leader Kim Jong-un lifted the market higher last
week, the hefty tariffs announced by the former on China, is likely to sour investors' mood.
Emerging markets remained unscathed after the
US Federal Reserve's hawkish tone, and the bulls on Dalal Street showed a great resilience
Last week, the broader NSE index gained 0.46 per cent and BSE posted a weekly gain of 0.50 per cent.
Here are key developments investors
might want to look at for the coming week:
Trade War Ahoy!US President Donald Trump announced late Friday that he was pushing ahead with
hefty tariffs on $50 billion of Chinese imports
And Beijing immediately vowed to responded, thus igniting fresh trade war concerns between the two biggest economies
India too joined, as the government decided to increase import tariffs on 30 items from the US amounting to $240 million in response against
tariffs imposed by the latter on aluminium and steel imports in March.
Slippery SlopeThe much-talked about Opec meet will be held on June 22
and 23 to review their production agreement
Opec and other exporters including Russia appear poised to ease voluntary production limits, which have helped shrink a global oil glut
since they went into effect in January 2017
However, many producers have tapped out and would prefer to hold back supply, which supports prices
Those nations include Venezuela, where output has cratered amid a prolonged economic crisis, and Iran, which is facing renewed US sanctions
aimed at cutting off its oil exports, says a CNBC report.
Opec meetings are closely watched because the producer group pumps about 40 per
cent of the world's oil.
Sensex RejigThe BSE Sensex composition is all set for a reshuffle on Monday, where Vedanta will replace Dr Reddy's
With Vedanta's inclusion, the weight of metals sector in the benchmark index will increase to 2.6 per cent
The existing metal player in the headline index Tata Steel carries 1.3 per cent weight
Vedanta, too, will have 1.3 per cent weight
On the flip side, the healthcare sector will hit an eight-year low as it stands to lose most in terms of weight (-70 bps to 1.7 per cent),
Earlier, in December 2017, Cipla and Lupin were excluded from the benchmark
Now, Sun Pharma will be the only such stock in the benchmark index.
ECB ForumA three-day ECB forum on central banking will start on Monday
The ECB (European Central Bank) in its policy meet last week said it would end asset purchases by the end of the year, but also pledged to
keep interest rates at current record lows at least through the summer of 2019
The more dovish-than-expected outlook for borrowing costs weighed on the euro and boosted the dollar
But Sintra speakers will still be listened to because any signs of a European growth setback could complicate the QE exit path, says Reuters
The forum will see the likes of ECB chief Mario Draghi, Bank of Japan’s Kuroda and the US Federal Reserve’s Jerome Powell.
BoE
Rate-Setting MeetThe Bank of England (BoE) will decide on interest rate on Thursday
It is expected to maintain status quo this time
BoE voted by seven to two to keep the bank rate at 0.5 per cent on May 10, due to a sharp slowdown in GDP growth in the first quarter
This apart, Brazil, Mexico, Taiwan, Philippines, Thailand and Hungary all have central bank meetings next week.
RITES IPO State-owned RITES
(Rail India Technical and Economic Services) is all set to launch its IPO on June 20
The price band of the offer has been set between Rs 180-185 per share with face value of Rs 10 each
At the upper price band of the offer, the company aims to raise Rs 466.2 crore
The three-day public offer will close on June 22, Friday
The IPO is part of the government's disinvestment programme
Last year, Finance Minister Arun Jaitley had announced Indian Railways’ plans to list its subsidiaries after the merger of the railway
budget with the Union budget.
Tech ChartsThe Nifty50 index on Friday slipped to near 10,750 level in the intraday trade before erasing the
losses of entire day to settle in the black, suggesting that the bulls were not in a mood to give in easily.
On the weekly timeframe chart,
the Nifty formed a small-body positive candle with a minor upper shadow
This pattern indicated rangebound movement in the market, said Nagaraj Shetti of HDFC Securities.
During the week, trading took place in a
138-point narrow range, leaving a dominant upper shadow
It should be a cause for concern, said Mazhar Mohammad of Chartviewindia.in.
"Unless the index closes above 10,930, the bulls will not gain
A breakout is needed for them to reach safe shores
A close below 10,755 shall re-establish the supremacy of the bears
Traders are advised to remain cautious,” Mohammad said.
