After a sharp recovery in the closing hours on Monday, Indian markets are expected to open on a flat note on Tuesday. While global cues remain mixed, SGX Nifty indicates a negative opening for the Indian markets.

Analysts say, while the market may move in a range, individual stocks are likely to see alternate bouts of buying and selling that will mar traders’ interest.

The SGX Nifty at 15,810 (8 am IST) indicates a flat-to-negative opening for Nifty futures, which on Monday closed at 15,832.65. Most Asian-Pacific markets are ruling in the positive terrain though US stocks overnight ended on mixed tone.

While Nikkei, Australia and Taiwan markets are up beween 0.5 per cent and 0.8 per cent in early deal on Tuesday, Hong Kong and Chinese markets are down. South Korea’s benchmark is ruling flat. Last night, the tech-focussed Nasdaq and S&P 500 closed in the green even as Dow Jones edged down marginally.

Inflation pressure

May month headline CPI inflation unexpectedly rose 210 bps to 6.3 per cent on unfavourable base effect, compounded by across-the-board rise in sequential momentum in both headline and core inflation. “However, the MPC may still choose to look through the spike in inflation in the near term, with the monetary reaction function currently hinging more on growth revival becoming sustainable,” said Emkay Global Research.

WPI-inflation came in at a 25-year high of 12.9 per cent YoY in May 2021 but lower than the market consensus of 13.4 per cent.

Nifty witnessed a massive intra-day recovery from the lows suggesting that the upmove is not out of strength. “However, the intra-day volatility was enough to prompt profit-taking across the board resulting in a negative advance-decline ratio. The street will now watch as to whether some more negative news will surface in the coming few days to prompt a more sustaining downmove,” said Deepak Jasani, Head of Retail Research, HDFC Securities.

Eyes on US Fed

The US Fed policy meeting to be held on June 15-16 is expected to dominate investor behaviour in the coming days. Though the Fed is expected to keep its rates unchanged, the key focus of the market will be on its comment on inflation, Vinod Nair, Head of Research at Geojit Financial Services.

Stock to watch

Media is abuzz that promoters of Newgen Software will sell 12 per cent stake in the company via block deals. According to reports, the stake sale could happen between ₹440-454 a share for ₹375 crore. Currently, promoters hold 65.73 per cent stake in the company.

Manorama Ind: The board of Manorama Industries Limited has approved new investments in setting up new capacity for fractionation and refinery process by 25,000 MT per annum each, along with supporting infrastructure with the total estimated capex of ₹65 crore.

NHPC Limited has signed a Memorandum of Understanding (MoU) with Bihar State Hydro-Electric Power Corporation Limited (BSHPCL) on Monday for execution of Dagmara HE Project (130.1 MW) in Bihar by NHPC Limited on ownership basis.

IPO watch

Shyam

Metalics’ ₹909-crore initial public offering (IPO) has been subscribed 1.23 times at the end of Day 1 of the issue. The IPO closes on June 16. The company has fixed the price band for its primary market offering at ₹303-306 per share. Shyam Metalics’ IPO will involve a fresh issue of shares worth up to ₹657 crore and an offer-for-sale amounting to ₹450 crore by existing shareholders, including Subham Capital, Subham Buildwell, Kalpataru Housefin & Trading, Dorite Tracon and Narantak Dealcomm.

Sona BLW Precision Forgings’ (Sona Comstar) ₹5,550-crore IPO was subscribed 11 per cent on Day 1. The issue has been priced at ₹285-291 a share. Blackstone-backed Sona BLW issue will close on June 16. The auto components maker’s public issue comprises a fresh issue of equity shares of up to ₹300 crore and an offer-for-sale (OFS) by selling shareholder Singapore VII Topco III Pte Ltd, an affiliate of the Blackstone Group Inc.

The IPO of (BSE-SME) Navoday Enterprises Ltd, a marketing and event management company, which opened on June 14, was subscribed 0.52 times. The IPO price has been fixed at ₹20 apiece. The company plans to raise ₹46 crore and the market lot is 6,000 shares. The stock will be listed at BSE-SME.

Results calendar

Agar Industries, BLS International Services, Centum Electronics, Easy Trip Planners, Entertainment Network (India), Flexituff Ventures International, India Home Loan, JMD Ventures, Jubilant FoodWorks, LIC Housing Finance, Lemon Tree Hotels, Manaksia, Power Finance Corporation, Salzer Electronics, Spencers Retail, and Whirlpool of India will declare their quarterly results on Tuesday.

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