Markets came under intense selling pressure on Wednesday on the back of a surge in the Japanese yen with the Nifty 50 breaching Tuesday’s low and closed near 50 EMA. The sudden surge in India’s VIX to 15.5% can be seen as a major threat to markets with option writers running to hedge their positions after action from the Bank of Japan.
Indian markets were the sole beneficiary of carrying trade at the time of the depreciating JPY, and we may see similar outflows in the coming days. The downside potential for the Nifty 50 stands at a further 16% lower and we expect major unwinding pressure in markets after the Nifty 50 takes out the 18100 mark. Financial and service-related stocks often see maximum selling during the surge in JPY.
Nifty 50 Index and Next Notes NIFTY 2X Tokyo
Stocks to watch
Positive Read through
- Adani Enterprises: Adani Solar launched India’s first large-sized monocrystalline silicon ingot, used to make PV modules
- RIL- Reliance Retail Ventures to acquire 100% stake in METRO Cash & Carry India Pvt Ltd. for Rs 2,850 crore.
- Bharat Forge started a supply of forgings utilizing green steel in order to reduce its carbon footprint.
- Specialty Restaurants board approved raising Rs 127.23 crore via the issue of 60 lakh warrants convertible at Rs 212.05 each.
- JB Chemicals has completed the acquisition of the Razel franchise from Glenmark Pharmaceuticals.
- Kalpataru Power Transmission- The Ahmedabad Bench of the National Company Law Tribunal approved the merger of JMC Projects with Co
- Borosil- Trial production of opal ware glass for the additional capacity of 42 TPD, began at the company’s Jaipur on December 20, 2022.
- Tata Comm Acquires Switch Enterprises – Canada-based video connect business Rs 486 cr
- Talbros Auto gets multi-year order worth Rs150 cr for Rubber Hoses from multiple passenger vehicle OEMs in India
Negative Read Through
- Lupin Issues Voluntary Nationwide Recall of Four Lots of Quinapril Tablets. Recall seen due to the presence of an impurity.
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