Vigilance in stock markets ahead of Fed meeting outcome; zee stock in focus

On Tuesday, the BSE Sensex was up 514.34 points or 0.88% at 59,005.27 and the Nifty was up 165.10 points or 0.95% at 17,562.

Asian stock markets made a cautious start on Wednesday and the dollar strengthened amid lingering nerves about a fallout from an imminent failure at developer China Evergrande and hopes the Federal Reserve could move a step closer to tapering.

Japan’s Nikkei fell 0.5%. Equity, bond and money markets in China opened for the first time on Wednesday as concerns over the plight of Evergrande sparked a wave of selling and contagion concerns around the world.

Singapore-traded FTSE China futures are down nearly 2% from Friday’s close. Safe assets such as the yen and the US Treasury rose slightly in morning trade.

Globally, markets calmed down after a sharp sell-off on Monday, as analysts downplayed the risk of Evergrande’s troubles becoming a “Lehman moment” and a looming financial crisis. But stocks have barely bounced and commodities remain under pressure as worries turn economic results.

Overnight on Wall Street, the S&P 500 fell 0.1% to sit down a little more than 4%, well below a record peak at the start of the month.

S&P 500 futures fell 0.4% in early Asia trade and the offshore yuan was under pressure near a one-month low of 6.4850 per dollar. Hong Kong markets are closed for the holiday.

Bloomberg reported Tuesday that Evergrande, as expected, missed interest payments to at least two of its biggest bank creditors on Monday. The next test will take place on Thursday when the firm must pay $83.5 million in interest on the bond — failure to do so within 30 days would put the bond in default.

The firm’s woes have already spread to other developers, and an index of high-yield Chinese corporate debt – mainly issued by property firms – has broken out. But investors are now expecting some kind of regulatory response from Beijing and hope that the global fall can be contained.

Back home, after Zee Entertainment and Dish TV, the Subhash Chandra family is gearing up for another shareholder activism in Zee Learn and Zee Media Corporation, with their extraordinary general body meeting to be convened soon, PTI reported.

Indiabulls Housing Finance on Tuesday said that it has raised ₹807.83 crore by way of issuance of Non-convertible Debentures (NCDs). This was an installment-1 NCD issue of the housing finance company, whose base issue size was ₹Greenshoe option up to Rs 200 crore and up ₹800 crores.

Singapore’s state investors Temasek Holdings and Canada’s Brookfield Asset Management are among at least four global investors looking to buy a 60% stake in US private equity firm KKR & Co Inc. in Ramky Enviro Engineers for at least $1 billion. are, according to a Mint report.

In currency markets, the dollar took a beating as traders raised the risk that the Federal Reserve could surprise markets by bringing forward its projections of hikes from 2023 to 2022. The dollar stood firm against the euro at $1.1722 and bought 109.13 yen.

It held the heavily-capped Australian dollar near a one-month low of $0.7229, while the kiwi was under pressure after a central bank official lowered expectations of a bigger rate hike at next month’s meeting.

The 10-year US Treasury yield was slightly lower at 1.3209%.

Most analysts agree the Fed won’t go into detail about its thinning plans — savings for November — but say the risk lies in the “dot plot” of board members’ rate projections.

Among commodities, copper remained near a one-month low and oil prices were supported by easing of inbound travel rules, which is likely to boost demand for airline fuel.

Brent crude futures rose 0.4% to $74.64 a barrel and US crude rose 0.4% to $70.75. Gold was supported at $1,774 an ounce.

(Reuters contributed to the story)