Global equity indices declined the most in June 2022 after the Covid sell-off witnessed in 2020. H1Cy22 has been very volatile and global indices declined sharply from all time highs as the record high inflation worries & aggressive rate hikes spooked the market participants. Weak macro-economic data amplified recession fears and quarterly earnings will be in focus.
Month of July is actioned packed with Fed & ECB policy-meeting outcomes and domestic Q1Fy23 earnings. USDINR pair touched record low levels amid Fed hawkish comments strengthened demand for USD. Sensex & Nifty likely to remain choppy in H2Cy22, given Fed hiking rates aggressively, weak earnings expectations due to weak global demand and FIIs/FPIs relentless selling pressure. Global PMIs, consumer confidence, and GDP growth data points have been reported at lower than market expectations, showing signs of weakening global demand for goods and services.
Domestic macro-economic data points reported in previous week are:
� S& P Global India manufacturing PMI level declined to 53.9 in June 2022
� Fiscal deficit expanded sharply to Rs 2.04 trillion or 12.3% of government target
� Infrastructure output in India jumped 18.1 % YoY in May 2022
�In the coming week, investors will watch out for US NFP data and Fed & ECB policy-meeting minutes. TCS will report earnings on 8th July 2022.
Equity Market Summary:
� In domestic markets FIIs/FPIs sold Rs. 502 billion in May 2022 and sold Rs. 26 billion in July 2022 (as of 03rd July 2022).
� Industrial production in Japan declined by 7.2% (MoM) in May 2022.
� Annual inflation rate in the Eurozone touched new record high of 8.6% in June 2022 from 8.1% in May 2022.
� China General Manufacturing PMI climbed to 51.7 levels in June 2022 from 48.1 levels in May 2022.
� Wallstreet indices closed on strong note Friday despite manufacturing data showed activity levels in June 2022 remained near two-year lows.
� USD GDP witnessed de-growth of 1.6% in Q1.
� European indices closed on flat note on Friday amid preliminary estimates shows inflation in Eurozone touched record high of 8.6% in June 2022. Fresh economic data amplified stagflation fears, as the ECB plans to begin its tightening cycle at its July meeting.
� Brent crude futures bounced back sharply from intraday lows, climbing more than 3% to USD 109.2 per barrel on Friday and recouping losses of the previous session.
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