Indian equity benchmarks extended their losses in today session, despite positive cues from other Asian markets. Traders were cautious, as in a tightening cycle, a premature pause in monetary policy action would be a costly policy error, Reserve Bank Governor Shaktikanta Das opined while voting along with five other members of the MPC for raising the key lending rate by 35 basis points earlier this month.
Besides, Finance Minister Nirmala Sitharaman said the government is keeping an eye on inflation which is purely extraneous nowadays because of fuel and fertiliser prices. Adding more worries, a CAG audit report on Direct Taxes drew attention to 57 instances of significant errors and irregularities in corporation tax assessments of high value cases involving tax effects of Rs 6,304.56 crore.
Nifty futures opened at 18327.00 points against the previous close of 18275.90 and opened at a low of 18112.00 points. Nifty Future closed with an average movement of 244.90 points and a decline of around 105.55 points and 18170.35 points…!!
On the NSE, the midcap 100 index will decline 0.87% and smallcap 100 index is closing decline 1.61%. Speaking of various sectoral indices, the NSE saw gains in only IT stocks, while all other sectoral indices closed lower.
At the start of intra-day trading, February gold opened at Rs.55069 fell from a high of Rs.55117 points to a low of Rs.54912 with a decline of 88 points, a trend of around Rs.54983 and March Silver opened at Rs.69758, fell from a high of Rs.69840 points to a low of Rs.68831, with a decline of 589 points, a trend of around Rs.69120.
Meanwhile, pressing for the prohibition of instruments like Bitcoin, Reserve Bank of India (RBI) Governor Shaktikanta Das has warned that the next financial crisis can be triggered by private cryptocurrencies, if such speculative instruments are allowed to grow. Das has been staunchly opposed to such instruments and the RBI has gone till the Supreme Court with its contention. He said ‘Cryptocurrencies… have huge inherent risks from macroeconomic and financial stability (perspective) and we have been pointing it out.’
The RBI governor stated that the developments over the last one year, which include the latest crash of cryptocurrency exchange FTX, which is termed as one of the biggest financial frauds in the history of the US, illustrate the threat posed by such instruments. He noted that private cryptocurrencies’ valuation has shrunk from $190 billion to $140 billion and there is no underlying value for the market-determined price.
Das acknowledged that different jurisdictions are taking different stances on it, but the RBI would like to stick to its stance of prohibiting them completely. He said the origin of private cryptocurrencies lie in their intent to break the system, in not believing in fiat currencies introduced by the central banks and not believing in a regulated financial system.
Technically, the important key resistances are placed in Nifty future are at 18202 levels, which could offer for the market on the higher side. Sustainability above this zone would signal opens the door for a directional up move with immediate resistances seen at 18272 – 18303 levels. Immediate support is placed at 18008 – 17808 levels.