 "Asian indices tumble; Nifty futures too edge down")
Hong Kong: Markets across Asia are down sharply in early trades, but curiously the Nifty futures market, a barometer of investor sentiment, has been relatively immune to the negativity.
As at 7.30 am IST, most indices across Asia are down in excess of 1 percent on weak cues from Wall Street overnight and grim news out of Europe centred around preparations for a Greek exit. Shanghai alone is swimming against the bearish current, and is up marginally, on hopes of a stimulus package in China. But elsewhere, sentiment is weighed down also by Fitch’s ratings downgrade on Japan.
[caption id=“attachment_318165” align=“alignleft” width=“380” caption=“Overnight, Wall Street made some early gains after strong housing data, which pointed to a revival of the market. Reuters”]
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Nifty futures too were somewhat out of step with the rest of Asia, and were actually up a tick in early trades. But since then, they too have edged down, although the fall thus far - of the order of about two-tenths of 1 percent - is nowhere near as severe as in the other markets.
Overnight, Wall Street made some early gains after strong housing data, which pointed to a revival of the market that was at the epicentre of the financial crisis of 2008. But those gains vanished into thin air after the former Greek Prime Minister suggested that preparations for a Greek withdrawal from the eurozone were under way. All three leading Wall Street indices finished about flat, but the undercurrent is very nervous.
Back home, the rupee’s continuing slide has investors and analysts fretting. The RBI’s interventions on the margins haven’t helped to shore up the rupee - and if anything, it led to a liquidity squeeze, which the RBI is now addressing through open market operations of the order of Rs 12,000 crore. That should ease the liquidity problem, but the rupee’s core problems remain, and the RBI may be fighting a losing battle on that front.
All things considered, given the downbeat sentiment in overseas markets, we’ll likely see a weak start to the trading day.
Venky Vembu attained his first Fifteen Minutes of Fame in 1984, on the threshold of his career, when paparazzi pictures of him with Maneka Gandhi were splashed in the world media under the mischievous tag ‘International Affairs’. But that’s a story he’s saving up for his memoirs… Over 25 years, Venky worked in The Indian Express, Frontline newsmagazine, Outlook Money and DNA, before joining FirstPost ahead of its launch. Additionally, he has been published, at various times, in, among other publications, The Times of India, Hindustan Times, Outlook, and Outlook Traveller.