10 things you need to know before the opening bell on June 8

SUMMARY

The Indian market is likely to open higher on Monday as SGX Nifty traded 90 points higher at 10,269 at 7:25 am, suggesting a positive start for the Sensex and the Nifty50. However, the gains could be capped by concerns over rising number of coronavirus cases amid easing of lockdown in the country.

By CNBCTV18.comJun 8, 2020 8:53:03 AM IST (Updated)

1. Aisa: Stocks in were higher in Monday morning trade after U.S. jobs data released Friday had an unexpected jump, spurring hopes of an economic recovery from the coronavirus pandemic. In Japan, the Nikkei 225 added 1.06 percent. The Topix index also rose 0.83 percent. Over in South Korea, the Kospi advanced 1.03 percent. Overall, the MSCI Asia ex-Japan index traded more than 0.2 percent higher. Markets in Australia are closed on Monday for a holiday.

2. US: U.S. stock futures were little changed on Sunday night following last week’s sharp gains as investors were optimistic over the reopening of the economy. Dow Jones Industrial Average futures traded 52 points higher, implying a Monday opening gain of 33 points. S&P 500 and Nasdaq-100 futures also pointed to a little changed Monday open for the two indexes. The Labor Department said Friday the economy added 2.5 million jobs in May, a record. Economists polled by Dow Jones had forecast a drop of more than 8 million.

3. Market At Close On Friday: Indian shares ended higher on Friday, helped by gains in financials, auto, and metal stocks. Meanwhile, Asian stocks erased early losses and were poised for their biggest weekly rise since 2011. The Sensex ended 306 points higher at 34,287 while the Nifty rose 113 points to settle at 10,142. Both the indices ended with second straight weekly gains, up around 6 percent each. Tata Motors, SBI, Bharti Infratel, Tata Steel, and Hindalco were the top gainers on the Nifty50 index while TCS, HUL, Bajaj Auto, Cipla, and Nestle led the losses.

4. Crude Oil: Oil prices rose more than 2% early on Monday to their highest in three months after OPEC and its allies including Russia agreed to extend record oil production cuts until the end of July. Brent crude climbed to as high as $43.41 a barrel and was trading at $43.32 by 0000 GMT, up $1.02, or 2.4 percent. U.S. West Texas Intermediate (WTI) crude gained 83 cents, or 2.1 percent, to $40.38 a barrel. Both hit their highest since March 6.

5. Rupee Close: The rupee pared its early gains to close almost flat at 75.58 against the US currency on Friday due to dollar demand from banks and rising crude oil prices. Forex traders said positive domestic equities, sustained foreign fund flows and the revival of business activities are supporting the rupee but dollar buying by banks and rebounding crude prices are restricting its gains.

6. Government To Suspend All New Schemes Up To Rs 500 Crore: In an office memorandum dated June 4 on ‘Appraisal and Approval of all Public Funded Schemes/Sub Schemes’, the government said it has suspended all new schemes up to Rs 500 crore till March 2021, which had earlier received in-principle approval for FY21. The government said there is unprecedented demand for public financial resources due to COVID-19 and resources need to be used prudently as per emerging and changing priorities. Hence only schemes announced under Atmanirbhar Bharat Abhiyan and Pradhan Mantri Garib Kalyan Package will be exceptions and will be initiated and continued in FY21.

7. Govt Tweaks Norms To Give Preference To Local Companies For Contracts: India has modified rules to give additional preference to local companies in government procurement contracts. These changes bar companies with less than one fifth Indian content from participating in most government tenders that are floated -- for buying pens to constructing highways. The Department For Promotion Of Industry and & Internal Trade has amended its Public Procurement (Preference to Make In India) Order of 2017 that gives priority to bidders of government contracts that use more local content.

8. Govt Brings IBC Amendment Ordinance: The government of India has effectively suspended fresh bankruptcy proceedings against persons impacted because of COVID-19 for at least six months, up to a maximum of one year. The new rules come into effect immediately, as of June 5. The changes to IBC to this effect were first announced by union finance minister Nirmala Sitharaman as part of the Atmanirbhar Bharat Abhiyan reforms. The idea, as per the government, is to “prevent corporate persons which are experiencing distress on account of unprecedented situation, being pushed into insolvency proceedings under the said Code for some time”, the ordinance read.

9. There Is No Perfect Time For Privatisation, Says Uday Kotak: The president of the Confederation of Indian Industries has a piece of advice for the government of India. When it comes to privatisation or disinvestment, there simply is no "perfect" time. In a conversation with CNBC-TV18’s Shereen Bhan, Uday Kotak commented, "On the whole area of privatisation, very often we hear the price is too low, therefore we have postponed it. My view is there is no perfect time. If we have made up our mind within a reasonable band of time we should go ahead and execute it." Arguing that there was merit in privatisation, he said, "Look at privatisation as not just the equity value but also the underlying debt that goes off the government’s shoulder as a headache."

10. OPEC, Russia Meet To Extend Record Oil Cuts: OPEC and its allies led by Russia met on Saturday over plans to extend record oil production cuts and to push countries such as Iraq and Nigeria to comply better with existing curbs. Nigeria's oil minister said he expected a deal on an extension, which has the backing of Saudi Arabia and Russia, to be concluded in the video conference talks despite "reservations of one or two member countries," which he did not name. OPEC+ sources have said Riyadh and Moscow agreed to extend existing record cuts throughout July, while they said Riyadh wanted a further extension to August and possibly even December.