Daily Market Commentary - August 23, 2022 - Bonanza Portfolio

Mr. Vishal Wagh, Research Head, BONANZA PORTFOLIO LTD

Indian indices opened on a negative note with the Nifty below 17400. At the time of closing, the Sensex was up 257.43 points or 0.44% at 59031.30, and the Nifty was up 86.80 points or 0.50% at 17577.50.

During the day, RBI set itself for a two-year timeframe to bring down inflation closer to its 4% target, bank's rate-setting panel is likely to opt for slowing down the pace of hikes and increase the repo rate by 0.25% in September. The central bank has hiked the repo rate by 1.40% in three consecutive rounds since May. The impact of the heat wave on the wheat harvest is expected to result in a low growth of the agricultural sector in Q1 FY2023. Overall, ICRA expects GDP growth in Q1 FY2023 to trail the 16.2% projected by the Monetary Policy Committee (MPC).

British consumer price inflation is set to peak at 18.6% in January, more than nine times the Bank of England's target, an economist at U.S. bank. China cut its benchmark lending rate and lowered the mortgage reference by a bigger margin, one-year loan prime rate (LPR) was lowered by 5 bps to 3.65% at the central bank's monthly fixing on Monday, while the five-year LPR was slashed by 15 bps to 4.30%. Japan's factory activity growth slowed to a 19-month low in August as output and new order declines deepened, amid growing pressure from persistent rises in raw material and energy costs and weakening global demand.

Gold prices edged higher after hitting a near one-month low in the previous session, helped by a slight pullback in the dollar. Euro Zone August manufacturing PMI at 49.7 and Services PMI at 50.2. UK August services PMI at 52.5 against an estimate of 51.6. On the sectoral front, buying is seen in the auto, bank, capital, metal, pharma, oil & gas and realty while IT and power stocks were under pressure.

Nifty 50 top gainers are M&M, Eicher Motors, Bajaj Finserv, Titan Company and Tata Steel while Infosys, TCS, Divis Labs, HUL and HCL Technologies were among the top losers.

Source : Equity Bulls

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