INDIAN BENCHMARKS are likely to witness gap down opening as the global cues look sluggish with SGX Nifty trading 79.50 points lower. Indian equity benchmarks are set to be rocked by renewed turmoil in China after the country weakened the yuan’s reference rate by the most since August, raising concerns over a worsening slowdown in the world’s second biggest economy, pushing global markets into a tailspin, and prompting traders to shun risky assets. Trading in China’s stock bourses was suspended for a second time this week after the benchmark index slid 7 per cent, triggering an automatic circuit breaker. The World Bank cut the global growth forecasts for 2016 to 2.9 per cent from 3.3 per cent estimated earlier as a slowdown in China prolongs a commodity slump while Brazil and Russia suffer steep recessions.
Headlines for the day:
1. Cipla inks pact with US firm for Ropivacaine infusion system
2. Lupin launches Generic Ortho Tri-Cyclen Lo Tablets
3. NBCC wins work construction orders worth Rs295 crore from IIT Mandi
Global Indices:
1. Asian stocks plummeted as China’s move to weaken its yuan reference rate to an unexpectedly low level raised more anxiety over the country’s economic slowdown. China’s Shanghai Composite fell over 7 per cent before trading was halted, Hang Seng shed over 2 per cent while Japan’s Nikkei 225 tanked 1.8 per cent as a stronger yen curbed the lure for exporter stocks.
2. Doom and Gloom struck Wall Street on Wednesday as worries over a China slowdown, coupled with heightened geopolitical fears amidst Middle East tensions and North Korea’s successful testing of a hydrogen bomb hit sentiment.
3. Investors cast aside mostly upbeat US economic data which showed that private payrolls in the US rose by the most in a year, up by 257,000 in December, services maintained solid growth, with the PMI coming in at 55.3 last month, well above the neutral 50-mark, after 55.9 in November.
Trend in FII flows: The FIIs were net sellers of Rs -352.42 Cr in the cash segment on Wednesday while the DIIs were net buyers of Rs 13.19 Cr, as per the provisional figures released by the NSE.
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