Market is seen opening higher tracking positive leads from Asian markets and overnight gains on the Wall Street. Trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty could rise 6.60 points at the opening bell.
In overseas markets, most Asian shares rose today, 21 June 2016, on growing expectations that British voters will opt to remain in the European Union in this week's referendum. But investors remain wary ahead of Thursday's vote, as well as Federal Reserve chief Janet Yellen's two-day testimony before Congress which starts later today, 21 June 2016, in which she might offer clues on the timing of the central bank's next interest rate increase. US stocks ended higher yesterday, 20 June 2016, but off their session highs, following the lead of European markets as polls showed support swinging back toward the UK remaining a member of the European Union ahead of a referendum.
The UK government holds a referendum on Thursday, 23 June 2016, on whether the country should remain a member of the European Union (EU). The Organization for Economic Cooperation and Development (OECD) has warned that Britain's leaving the EU -- the so-called Brexit -- could send shocks through global financial markets. The OECD said on 1 June 2016 that a United Kingdom vote to leave the EU would trigger negative economic effects on the UK, other European countries and the rest of the world. Brexit would lead to economic uncertainty and hinder trade growth, with global effects being even stronger if the British withdrawal from the EU triggers volatility in financial markets, the OECD said. By 2030, post-Brexit UK GDP could be over 5% lower than if the country remained in the European Union, the OECD said.
Closer home, foreign portfolio investors (FPIs) sold shares worth a net Rs 537.46 crore yesterday, 20 June 2016, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 724.06 crore yesterday, 20 June 2016, as per provisional data.
Among corporate news, bank stocks will be in focus after the finance ministry in its quarterly revision on interest rates on small savings schemes kept the rates unchanged for Q2 September 2016. The government now announces revision in interest rates on small saving schemes on quarterly basis as against the earlier practice of annual revision. The decision to shift to quarterly revision from annual revision was taken to ensure that interest rates under small savings schemes are more dynamically related to the prevailing market rates. It may be recalled that the finance ministry had in March 2016 announced reduction in interest rates on small savings schemes for Q1 June 2016 in a move to bring the rates in line with the prevailing money market rates.
Mahanagar Gas (MGL) opens its initial public offer (IPO) of 2.46 crore shares today, 21 June 2016. The issue will close on Thursday, 23 June 2016. The price band for the issue has been fixed at Rs 380 to Rs 421. The IPO includes offer for sale of upto 1.23 crore shares by GAIL (India) and upto 1.23 crore shares by BG Asia Pacific Holdings PTE Ltd (BGAPH). The company is promoted by GAIL India and BGAPH, each of who holds 45% of the company's equity shares. MGL is one of the largest city gas distribution (CGD) companies in India.
MGL has raised Rs 309.36 crore by allotting shares to anchor investors. MGL sold 73.48 lakh shares to 25 institutional investors at the upper-end of the Rs 380-421 price band.
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The government's announcement of a further liberalization of foreign direct investment (FDI) rules in some sectors and gains in global stocks aided the upmove on the domestic bourses at the onset of the week yesterday, 20 June 2016.The barometer index, the S&P BSE Sensex, rose 241.01 points or 0.91% to settle at 26,866.92. The gains for the Nifty 50 index were lower in percentage terms than those for the Sensex. The Nifty rose 68.30 points or 0.84% to settle at 8,238.50. The Sensex and the Nifty, both, attained their highest closing level in almost two weeks. European stocks led gains in world stocks after polls over the weekend showed resurgence in support for the UK staying in the European Union (EU) ahead of the 23 June Brexit referendum. Brexit refers to the referendum on 23 June 2016 by British voters to decide whether the country should remain a member of the European Union or leave it. Eighteen out of the nineteen sectoral indices on BSE registered gains.
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