The equity market halted a three-week winning run and lost more than 2% in the week ending June 10 as inflationary pressures, growth worries, high oil costs, and FII selling weighed on the mood. 

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Friday’s trading was terrible, with the BSE Sensex losing almost 1,000 points in a single day. The Nifty finished barely above 16,200. The Sensex fell 1,465.79 points, or 2.63%, in the week ending June 10, 2022, to close at 54,303.44. The Nifty 50 index fell 382.50 points, or 2.31%, to 16,201.80. The BSE Mid-Cap index dropped 1.25% to 22,490.32. The BSE Small-Cap index fell 2% to close at 25,857.42.

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How equity benchmarks performed on a weekly basis:

Monday, June 6, 2022 

On Monday, the domestic stock benchmarks concluded with minor losses. Investors were wary ahead of the Reserve Bank of India’s (RBI) policy statement later in the week. The S&P BSE Sensex dropped 93.91 points, or 0.17%, to 55,675.32. The Nifty 50 index dropped 14.75 points, or 0.9%, to 16,569.55.

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Tuesday, June 7, 2022 

On Tuesday, the equity indices concluded the day with significant losses, falling for the third day in a row. The Sensex fell 567.98 points, or 1.02%, to 55,107.34. At 16,416.35, the Nifty 50 index fell 153.20 points, or 0.92%. 

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Wednesday, June 8, 2022 

On Wednesday, the major stock indices closed a tumultuous session with minor losses, falling for the fourth day in a row. The Sensex fell 214.85 points, or 0.39%, to 54,892.49. To 16,356.25, the Nifty 50 index declined 60.10 points, or 0.37%.

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Thursday, June 9, 2022 

On Thursday, key domestic market benchmarks finished with robust gains, halting a four-day losing streak. The Sensex rose 427.79 points, or 0.78%, to 55,320.28. The Nifty 50 index increased by 121.85 points, or 0.74%, to 16,478.10. 

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Friday, June 10, 2022 

On Friday domestic market indexes fell extending their losing streak after a day’s break. The S&P BSE Sensex fell 1,016.84 points, or 1.84%, to 54,303.44. To 16,201.80, the Nifty 50 index slid 276.30 points or 1.68%.

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What happened in the Global markets:

India

The Cabinet Committee on Economic Affairs (CCEA), led by Prime Minister Narendra Modi, approved a hike in the Minimum Support Prices (MSP) for all mandatory Kharif crops for the marketing season 2022-23 on Wednesday (8 June).

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The World Bank has reduced India’s growth projection for the current fiscal year to 7.5%, a 1.2 percentage point decrease from its earlier forecast of 8.7%. The World Bank reduced its prediction for India’s GDP growth due to rising prices, supply chain constraints, and geopolitical concerns. The bank now expects India’s growth to decrease to 7.1% in FY24. This is a 30 basis point increase above the prior estimate of 6.8%. GDP growth has been set at 6.5% in FY25. 

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The Monetary Policy Committee (MPC) of the RBI convened on June 6th, 7th, and 8th, 2022. Based on an assessment of the current situation and prospects, the MPC unanimously decided to raise the policy repo rate by 50 basis points to 4.90%.

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China

The Caixin Services Purchasing Managers’ Index in China came in at 41.4, up from 36.2 in April but still in the contraction zone. According to data from China’s Bureau of Statistics, the producer price index increased 6.4% in May compared to the previous year. The consumer price index increased 2.1% year on year in May.

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United States

The government announced on Friday that American firms gained 390,000 jobs last month. For the third month in a row, the jobless rate remained at 3.6%.

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Europe 

The European Central Bank (ECB) stated on Thursday that it intends to raise interest rates by 25 basis points at its July meeting, with another hike predicted in September, the magnitude of which would be determined by the medium-term inflation forecast.

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The ECB has increased its inflation predictions for the eurozone while decreasing its growth forecasts. The ECB upped its inflation forecast but reduced its growth forecast as the Ukraine war continues to impact confidence, consumption, and investment. The ECB now anticipates inflation above its 2% objective throughout its projection horizon, acknowledging that high price increases is not as short-lived as it had predicted in the previous year. The World Bank lowered its global growth prediction for 2022 to 2.9% on Tuesday, warning that the world economy might enter a period of stagflation reminiscent of the 1970s.