Mr Mitul Shah, Head Of Research at Reliance Securities.
Domestic equities closed sharply lower due to heavy sell-off after RBI announced a 40 bps hike in repo rates in a surprise and unscheduled meeting. Nifty declined 2.3%, while broader markets moved largely in tandem with the main indices as Nifty MidCap and Nifty SmallCap fell 2.1% and 2.4% respectively. All sectoral indices ended in red. Nifty Media was the biggest laggard which plummeted 4.3%, followed by Nifty Reality and Nifty Metal which were down ~3.2% each. Meanwhile, LIC's initial share sale witnessed strong participation from policyholders and retail investors. Moreover, earnings results, Russia-Ukraine war and surging COVID-19 cases continue to remain on focus.
U.S equities ended higher on healthy corporate earnings. The S&P 500 gained 0.48%, the Nasdaq gained 0.21%, while the Dow Jones rose 0.17%. The yield on 10-year Treasury note close to its multi-year high levels and ended at 2.957%. The Fed is also likely to approve plans to begin shrinking its $9 trillion asset portfolio starting in June, at a much faster pace than previously expected.
The much-awaited IPO of LIC opened for subscription today. GST has peaked to an all-time high of Rs1.68 lakh crore in April 2022. For FY22 as a whole, total GST collections amounted to Rs14.83 lakh crore, up 30.. For equities, inflation remains a key overhang, coupled with the multi-sided impact of Russia's lingering war with Europe and strict lockdowns in Shanghai. Meanwhile, markets await on the next batch of quarterly results in the coming weeks. The Indian economy has shown signs of growth and recovery across the board, despite elevated input and labour costs and ongoing supply chain disruptions. Moreover, trend in global stock markets and the movement of rupee and crude oil prices, will dictate market trend in the near-term. The markets are likely to see gap down opening, SGX nifty is largely flat compared to Monday's spot Nifty closing. Asian markets trading in red with Nikkei is down 0.1%, while Hang Seng is down 1.2%.