Market Talk – Monday, April 12

ASIA:

Asian markets have a very volatile day today. The surge in Covid-19 numbers globally has raised concerns worldwide. Indian markets fell in line with other major Asian markets. Nikkei in Japan, Hang Seng in Hong Kong, and Shanghai Composite in China fell between 0.5 percent and 1 percent on Monday. The continuing rise in Covid cases over the last six weeks also had an impact on the industrial sentiment and India’s manufacturing sector activity weakened sharply in March, with the IHS Markit India Manufacturing Purchasing Managers’ Index (PMI) slipping to a seven-month low of 55.4 in March from 57.5 in February. This marks an indication for a slowdown in the manufacturing sector due to restrictions on account of the fresh surge in Covid-19 pandemic cases and the situation is set to turn more challenging in April.

India’s central bank has launched an Open Market Operations program Government Securities Acquisition Programme (G-SAP) — through which it will purchase government securities worth Rs 1 lakh crore in the first quarter of FY22. The RBI also announced that it would continue with a variable rate reverse repo to suck excess liquidity. While the 10-year G-Sec bond yields dropped 0.6% to 6.08 on Wednesday, the benchmark Sensex gained 0.9% to close at 49,661.7. In the backdrop of the government’s elevated borrowing for this year, which the RBI has to ensure goes through without causing disruption, G-SAP aims to provide more comfort to the bond market, market participants said.

The major Asian stock markets had a mixed day today:

  • NIKKEI 225 decreased 229.33 points or -0.77% to 29,538.73
  • Shanghai decreased 37.73 points or -1.09% to 3,412.95
  • Hang Seng decreased 245.52 points or -0.86% to 28,453.28
  • ASX 200 decreased 21.20 points or -0.30% to 6,974.00
  • Kospi increased 3.71 points or 0.12% to 3,135.59
  • SENSEX decreased 1,707.94 points or -3.44% to 47,883.38
  • Nifty50 decreased 524.05 points or -3.53% to 14,310.80
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