ASIAN MARKET HOLD AGROUND AMID INFLATION WOES

Consumers around the world are paying much higher prices for basics like shelter, food, and gasoline as Russia’s Ukraine invasion further snarls supply chains and cuts off access to oil and food exports. After a pandemic-related wave of higher prices, the conflict is now pushing global inflation past 6%.

The US, where prices jumped 8.5% on the year in March, is not the only country struggling with inflation. China and India may need to switch to cheaper cooking oil, whose prices have surged 70% in some cases. Gasoline prices, meanwhile, have shot up past $10 a gallon in Hong Kong, and the International Energy Agency is warning of a global energy crisis. Higher prices are leading to political turmoil, from growing support for anti-immigrant populist parties to worker protests in Europe.

INDIA

Market is under pressure on account of inflation worries ahead of US inflation data release. Even March CPI inflation is set to increase to 6.37 percent from 6.07 percent in February. Along with this RBI hawkish turn at its policy review on April 8 and few sectors expected to have an adverse effect in their quarterly results due to commodity price rise and inflation, have put added pressure on the market. Benchmark index corrected almost 0.5%. The Mid and Small caps were also seen under pressure today. Investors are advised to maintain liquid cash in hand to take advantage of any falls in quality stocks due to poor performance in quarterly results. We expect some volatility in market on account of weekly expiry.

For Nifty50, 17400 will act as very strong support on breaking which we might see 17310 levels and if this level is also breached than next stop will be around 17260 levels. On upper side 17650 will act as very strong resistance, if Nifty goes beyond these levels than next stop will be around 17800, which if broken will take markets to 17990 levels.

CHINA

The Shanghai Composite rose 0.8% to 3,211 while the Shenzhen Component edged up 0.5% to 11,627 on Thursday, as the Chinese government vowed to use monetary policy tools including reducing the reserve requirement ratio for banks to help spur economic recovery, according to state media. In a recent cabinet meeting presided by Premier Li Keqiang, Chinese lawmakers agreed to deploy policies and measures to boost consumption and help stabilize the economy, and to provide tax rebates and support the stable development for foreign trade. The State Council will also urge large banks with high provisioning levels to cut their provisioning ratios and use RRR cuts in a timely manner, according to the report. Consumer, healthcare and technology stocks led the advance, with strong gains from Kweichow Moutai (2.6%), Wuliangye Yibin (4.1%), Shijiazhuang Yilin (-7.7%), Andon Health (10%), East Money (4.1%) and Chutian Dragon (5.2%).

JAPAN

The Nikkei 225 Index climbed 1.3% to 27,182 while the broader Topix Index gained 0.8% to 1,906 on Thursday, extending sharp gains from the previous session, as Japanese shares tracked a strong overnight finish on Wall Street. Investors shrugged off the latest US CPI report amid signs that inflation may be peaking, with US core consumer prices showing slower increases. Sentiment was also lifted across the Asian region after Chinese policymakers flagged upcoming cuts to banks’ reserve requirement ratios to support an economy battered by Covid lockdowns. Transportation stocks led the advance as Japan looked to avoid new virus curbs, with gains from Nippon Yusen (1.9%), East Japan Railway (3.5%) and Japan Airlines (4.3%). Other index heavyweight also gained, including SoftBank Group (2.8%), Tokyo Electron (1.6%), Shionogi & Co (4.6%), Tokyo Electric (6.4%) and Fast Retailing (2.4%).