Global cues, tax clarification, Gift Nifty: Key triggers for Nifty on May 6

All you need to know before Sensex, Nifty opens for trade on Monday, May 06: Gift Nifty hints at gap-up open; FM dismisses buzz of changes in capital gains tax and Q4 results.

Pre-market commentary for May 06, Monday: Global cues and hints from Gift Nifty indicate that equity markets in India may start the week on an upbeat note.

At 07:00 am, Gift Nifty futures quoted near 22,693 levels, suggesting a gap-up of over 100 points on the Nifty 50 index.

Last Friday, the equity benchmark indices took a sharp knock in intra-day deals amid rumours of changes in capital gains tax structure in Budget 2024. The Finance Minister  Nirmala Sitharaman, however, denied any such claims.

Analysts believe that FM’s clarification could see the markets stage a bounce-back on Monday. READ MORE

Commenting on the outlook for the week ahead, Vinod Nair, Head of Research of Geojit Financial Services, expects the market to consolidate in the near-term due to expensive valuations and any election-led jitters. Among the key triggers for the week ahead, the analyst says market shall be vigilant about the BoE (Bank of England) policy and GDP data from the euro zone. 

Global cues

The US market on Friday ended with strong gains after softer-than-expected jobs report reignited hopes of an interest rate cut this year. Analyst viewed the report as a ‘Goldilocks’ scenario that may take some heat off inflationary pressures in the economy.

Nasdaq zoomed 2 per cent. The S&P 500 and Dow Jones jumped over 1 per cent each. The US 10-year bond yield dropped to 4.5 per cent, in the process logged its biggest weekly decline since December 2023.

Among key commodities, Gold futures slipped to $2,300 levels, while Brent Crude Oil held ground around $83 per barrel levels.

Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services expects FPIs (Foreign Portfolio Investors) to turn as aggressive buyers if the US bond yields fall and the Indian economy and markets do well.

‘The latest jobs data in the US indicates a slowing economy and, therefore, rate cuts may be necessitated. The wage increase falling below 4 per cent also reflects a weakening labour market. From the stock market’s perspective this is good news, said Vijayakumar in a note.

Stocks in focus

On Monday, shares of Kotak Mahindra Bank, Britannia, REC, Titan and Mahindra Finance are expected to react to Q4 results announced over the weekend.

Today Arvind, Bombay Dyeing, CarTrade Tech, CG Power and Industrial Solutions, Gujarat Fluorochemicals, GHCL, Godrej Consumer Products, Gujarat Gas, Happiest Minds, Indian Bank, Lupin, Marico, Punjab Chemicals, Route Mobile, Selan Exploration, Suven Life Sciences and Uttam Sugar Mills are scheduled to announce March quarter results.

Shares of Apeejay Surrendra Park Hotels, ESAF Small Finance Bank, Cello World, Flair Writing Industries, and DCX Systems will also be in focus as the lock-in period is set to expire this week.

Primary Market Update

Indegene IPO: To open for subscription on Monday. Company is offering shares in the price band of Rs 430 – Rs 452. The shares were quoting at 50 per cent premium in off-market deals. The IPO closes on May 08, Wednesday.