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Nifty ends below 15,750; oil & gas stocks tumble
(15:38, 14 Jun 2022)

The key equity indices ended with small losses after a volatile session on Tuesday. The Nifty closed below the 15,750 mark, extending its losing streak for third consecutive session. Oil & gas, auto and bank stocks declined while metal and pharma shares advanced.

As per provisional closing data, the barometer index, the S&P BSE Sensex, declined 153.13 points or 0.29% to 52,693.57. The Nifty 50 index lost 42.30 points or 0.27% to 15,732.10. In three sessions, the Sensex has declined 4.75% while the Nifty has lost 4.53%.

In the broader market, the S&P BSE Mid-Cap index shed 0.16% while the S&P BSE Small-Cap index slipped 0.40%.

The market breadth was negative. On the BSE, 1,550 shares rose and 1,766 shares fell. A total of 133 shares were unchanged.

While easing domestic inflation in May gave some hope to investors, recession fears in the US continued to loom large ahead of the US Fed's policy outcome due on Wednesday.

A major foreign brokerage has reported forecasted a 75-basis point (bp) interest rate hike from the Fed's June policy meeting on Wednesday. A 75-bp hike would reportedly be the biggest since 1994.

Economy:

India's inflation based on the Wholesale Price Index (WPI) rose further in May, hitting 15.88%, according to data released by the commerce ministry today. WPI inflation was 15.08% in April 2022 and 13.11% in May 2021. The high rate of inflation in May, 2022 is primarily due to rise in prices of mineral oils, crude petroleum & natural gas, food articles, basic metals, non-food articles, chemicals & chemical products and food products etc. as compared to the corresponding month of the previous year, stated the Ministry of Commerce and Industry.

India retail inflation (CPI) eased to 7.04% in May, mainly on account of softening food prices, though it remained above the RBI's upper tolerance level for the fifth consecutive month, government data showed on Monday. The Consumer Price Index (CPI) based inflation was 7.79% in April. In May 2021, the retail inflation stood at 6.3%.

Buzzing Index:

The Nifty Oil & Gas index fell 1.22% to 7,707.75. Hindustan Petroleum Corporation (down 5.66%), Oil India (down 5.57%), Indian Oil Corporation (down 2.9%), Indraprastha Gas (down 2.82%) and Oil & Natural Gas Corporation (down 2.23%) were the top losers.

Among the other losers were Petronet LNG (down 1.9%), Reliance Industries (down 1.39%), Bharat Petroleum Corporation (down 1.15%), Castrol India (down 0.58%) and Gujarat Gas (down 0.51%).

Meanwhile, Adani Total Gas (up 1.52%), Mahanagar Gas (up 1.02%) and Aegis Logistics (up 0.61%) edged higher.

Stocks in Spotlight:

Bajaj Auto dropped 5.85%. The two-wheeler maker on Tuesday said that its board has decided that further deliberations are required in order to take a decision on the proposal of buyback, and accordingly deferred the matter.

Adani Enterprises (AEL) advanced 5.65%. AEL and TotalEnergies have entered into a new partnership to jointly create the world's largest green hydrogen ecosystem. In this strategic alliance, TotalEnergies will acquire 25% minority interest in Adani New Industries (ANIL) from AEL.

ANIL's ambition is to invest over $50 billion over the next 10 years in green hydrogen and associated ecosystem. In the initial phase, ANIL will develop green hydrogen production capacity of 1 million ton per annum before 2030.

Bharti Airtel rose 1.37%. The company said it launched Xstream multiplex, an extension of Airtel's Xstream premium offering, on the Partynite Metaverse platform.

Torrent Power gained 3.26%. The Gujarat-based integrated power utility on Monday said it has completed acquisition of a 50-megawatt (MW) solar power plant in Telangana from SkyPower Group for Rs 416 crore.

Dr Reddy's Laboratories rose 0.96%. The drug major announced the launch of Sorafenib tablets, a generic equivalent of Nexavar tablets in the U.S. market as approved by the United States Food and Drug Administration (USFDA).

RBL Bank added 0.51%. The private lender said that the speculation and rumors linking its new MD & CEO with asset quality challenges of the bank are unfounded and baseless.

Metropolis Healthcare fell 3.81%. With references to the various news items/articles appearing on various media platforms, the company said that given the evolving market conditions and industry requirements, Metropolis Healthcare continuously explores various strategic options/investment opportunities.

On account of this, the company keeps receiving inbound interest from financial institutions and companies part of the healthcare eco-system for a potential minority stake purchase in MHL. Promoters have no intention to exit the business and are in fact focused on strengthening the Metropolis brand.

Global Markets:

The US Dow Jones futures were currently trading with a gain of 76 points, indicating a positive start to equities on Wall Street today.

European stocks declined while Asian stocks ended mixed on Tuesday.

German inflation accelerated to a five-decade high of 7.9% year on year by national standards in May, official figures confirmed Tuesday.

The U.K. unemployment rate rose slightly in the three months to April to 3.8%, the Office for National Statistics revealed Tuesday. Meanwhile, job vacancies rose to a record 1.3 million.

US equities tumbled on Monday, with the S&P 500 confirming it is in a bear market, as fears grow that the expected aggressive interest rate hikes by the Federal Reserve would push the economy into a recession.

Investors are looking ahead to Wednesday when the Fed is expected to announce at least a half-point rate hike. The central bank has already raised rates twice this year, including a 50-basis-point increase in May in an effort to stave off the recent inflation surge. The Fed could even raise rates by 0.75% this week following Friday's CPI report, as per reports.

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