Before the trading day starts we bring you a digest of the key news and events that are likely to move markets. Today we look at:
Good morning, this is Ashutosh Joshi, an equities reporter in Mumbai. Indian stocks are poised for another turbulent trading session as investors react to US developments. President Donald Trump’s threat to impose tariffs on Canada and Mexico next month has raised concerns, although China seems to have been spared for now. Numbers from Tata Technologies and ICICI Prudential will be watched after two major earnings misses on Monday.
Earnings season still awaiting a turning point
Over 10 days into the quarterly earnings season, the market is still waiting for signs that corporate performance has bottomed out and is set to improve. Of the 51 Nifty members, only 10 have reported their results, with just three — including Reliance Industries — beating estimates. Four others barely met expectations, while new-age tech stars Zomato and Paytm contributed to the dour mood with underwhelming numbers.
More pain ahead for capital goods shares
Capital goods stocks, which have been the poster boys of the market rally, were also swept up in the December-quarter selloff, driven by concerns about expensive valuations. Analysts at Kotak Institutional Equities caution that these stocks are still expensive, with current prices implying growth expectations above historical longer-term averages. The brokerage anticipates further challenges for the sector and favors stocks that are less reliant on a recovery in private-sector spending.
Sugar mills hopping to hit a sweet spot
Shares of sugar mills had a rough 2024 thanks to the government’s inflation-curbing measures that squeezed profit margins. However, there are early signs of recovery for the sector. Following a favorable monsoon, India has eased curbs on exports of the sweetener and reduced the cost of rice supplied for ethanol distilleries. Sugar stocks rallied on Monday, but traders are keeping a close eye on the overall market sentiment before diving back into the sector.
Three great reads from Bloomberg today:
As global markets brace for heightened uncertainty and Indian equities remain in the correction zone, the caution is leading to one change that authorities have been striving for: a drop in speculative trading. Regulatory curbs and increased margin requirements have played a key role, causing the notional turnover of stock derivatives — once peaking at almost $6 trillion — to now potentially drop below $2 trillion.
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With assistance from Kartik Goyal.
This article was generated from an automated news agency feed without modifications to text.