Indian Shares Likely To Open Flat Or Slightly Lower

Lower SGX Nifty and weakness in Asian markets point to a flat or negative start for Indian shares Thursday morning.

The mood is likely to be cautious with investors looking ahead to first quarter earnings. Activity is likely to be mostly stock specific.

Shares of automobile manufacturers will be in focus today with vehicles sales data for the month of June setting the trend.

Vodafone Idea on Wednesday reported consolidated loss of Rs 7,022.8 crore for the quarter ended March 2021, compared with a loss of Rs 11,643.5 crore in the year-ago quarter.

Jain Irrigation Systems reported consolidated profit of Rs 49.09 core for the fourth quarter of 2020-21, compared with loss of Rs 324.16 crore in the same quarter in the previous financial year.

On the economic front, data released by the Controller General of Accounts on Wednesday showed India’s fiscal deficit for the first two months (April-May) of 2021-22 came in at Rs 1.23 lakh crore, or 8.2 percent of the full year target of Rs 15.07 lakh crore. For the same period last year, the fiscal deficit was 58.6% of the full year target as revenues had dried up due to lack of economic activity as the country was in the lockdown mode.

Another data released by the government showed Infrastructure output in India increased by 16.8 percent year-on-year in May, after rising by a revised 60.9 percent in April due to low base effects from last year when the coronavirus pandemic hit the economy hard. In May last year, infrastructure output declined 21.4 percent.

A report on manufacturing activity in India in the month of June and trade data for the month are due out Thursday.

The Indian market slid Wednesday afternoon and ended flat, giving up strong early gains, as worries about spikes in the Delta variant of Covid-19 and fresh travel curbs in several countries in Asia and Europe weighed on sentiment. Profit taking at some major counters contributed as well to market’s fall from higher levels.

The benchmark BSE Sensex plunged more than 425 points from the day’s high and ended with a loss of 66.95 points or 0.13 percent at 52,482.71. The Nifty settled with a loss of 26.95 points or 0.17 percent at 15,721.50, off the day’s high of 15,839.10.

Despite some upbeat economic data, the major European markets ended notably lower on Wednesday, as uncertainty about the pace of economic recovery amid a surge in the Delta variant coronavirus cases and travel curbs in several countries rendered the mood bearish.

U.S. stocks closed broadly higher on Wednesday. Among the major averages, the Dow advanced 0.61 percent and the S&P 500 gained 0.12 percent, while the Nasdaq ended lower by 0.17 percent.