Sensex sees worst day in two months on US Fed interest rate fears

India’s stock market tumbled on Wednesday, along with global peers, on resurgent worries that the US Federal Reserve may have to raise interest rates more than what the Street has been factoring in. The Sensex posted its worst single-day fall since December 23, plunging 1.52 per cent, or 928 points, to end the session at 59,745. The Nifty50 index closed at 17,554, with a decline of 272 points, or 1.53 per cent — the most since January 27. Overseas investors sold shares worth Rs 580 crore, while domestic institutions were net buyers to the tune of Rs 372 crore, according to provisional data from the exchanges. Investors’ worries were stoked by strong US payroll data and higher-than-expected readings on S&P Global’s US composite purchasing managers’ index, suggesting that it would take more rate hikes for the world’s largest economy to cool off. The economic data pushed the benchmark 10-year US Treasury yield to 3.95 per cent — the highest in four months and close to 2007 highs. Typically, US bond yields and global equities move in opposite directions.

FDI equity inflow contracts 15% to $36.7 billion in Apr-Dec: Govt data*
Foreign direct investment (FDI) in equity during the first three quarters of this fiscal year declined 15 per cent year-on-year to $36.75 billion, according to the data released by the Department for Promotion of Industry and Internal Trade (DPIIT) on Wednesday. In all, FDI, which includes the equity capital of unincorporated bodies, reinvest earnings, and other capital, stood at $55 billion during April-December from $60.4 billion a year ago, an 8 per cent fall. FDI inflows have been declining since the beginning of the year due to challenges in the external sector such as recessionary trends in major developed economies. During the first half of the year (April-September), the contraction was 14 per cent. Last fiscal year, FDI equity inflows dropped by 1 per cent after robust growth of 19 per cent and 13 per cent during FY21 and FY20, respectively.

Sebi proposes to tighten regulations on issuance of bonus shares*
The capital market regulator plans to tighten regulations on the issuance of bonus shares, making only the dematerlialised ones eligible. Further, it has also proposed to streamline rules for under-writing of initial public offerings (IPO) and follow-on public offers (FPO). The Securities and Exchange Board of India (Sebi), on Wednesday, floated a consultation paper seeking comments on changes in Issue of Capital and Disclosure Requirements Regulations (ICDR). “A listed issuer shall be eligible to announce its bonus issue only if it has received in-principal approval from the stock exchanges for listing of all the pre-bonus securities issued by the listed entity excluding Employee Stock options (ESOPs) and convertibles shares/ warrants,” said Sebi.

Commodity play
Gold – Rs 56230/10gm, Silver – Rs 65721/kg, Brcrude – Rs 6143/barrel, Degumsyoil – Rs 1296/10kg, Copper – Rs 780/kg.

Corporate News
Zomato unveils new ‘Everyday’ offering for affordable home-cooked meals.

Sri Lanka investment board approves $442-mn Adani Green wind power plants.

Some relief for Khaitans as McLeod Russel gets interim stay in CIRP.

SGX Nifty indicates positive start to Indian markets trading at 17605 levels up by 48.5 points or 0.28%, while Dow Jones ended yesterday`s session in red down by 0.26% at close.

Sector in focus – Banks, IT, Real-estate & Power.

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