Extending their previous
session's downfall, Indian equity benchmarks ended the Wednesday's trade in red
terrain, with frontline gauges ending with a cut of around half a percent, declining
below their crucial 10,500 (Nifty) and 34,200 (Sensex) levels. Markets made
pessimistic start and traded in red terrain throughout the session, as traders
remained on sidelines ahead of December quarter GDP data to be announced later
in the day. Sentiments also remained downbeat with report that the collection
of Goods and Services Tax (GST) slipped marginally to Rs 86,318 crore in
January 2018 (received in January/February up to February 25, 2018), from Rs
86,703 crore in December 2017. Markets extended losses, as growth in India's
factory activity slowed to a four-month low in February as new orders eased and
weighed on output after manufacturers raised prices at the fastest pace in a
year. The Nikkei Manufacturing Purchasing Managers' Index (PMI) fell to 52.1 in
February from January's 52.4. Markets made an attempt to pare losses and
recovery was seen in second half of the session, but it proved short-lived and
selling in dying hour of trade dragged markets lower. Sentiments remained
dampened on report that the fiscal deficit for the April-January period stood
at Rs 6.77 lakh crore. That is 113.7% of FY18 target, which means Modi
government may not do any extra spending in the remaining two months of the
year. The government outlined a fiscal deficit target of 3.3 per cent of GDP in
2018-19 as against a revised estimate of 3.5 per cent in 2017-18, indicating
some fiscal consolidation, albeit at a slower pace than that recommended under
the Fiscal Responsibility and Budget Management (FRBM) framework. Investors
shrugged off Finance Minister Arun Jaitley's statement that India's economy has
the potential to achieve a growth rate of more than 7-8 per cent in view of
policy changes accompanied by a supportive global environment. He also said
India will continue to remain one of the fastest growing economies in the
world. Finally, the BSE Sensex shed 162.35 points or 0.47% to 34,184.04, while
the CNX Nifty was down by 61.45 points or 0.58% to 10,492.85.
The US markets closed lower on
Wednesday, to finish the month with losses. Major indexes finished out February
on pessimistic note, with the S&P 500 and the Dow logging their worst
monthly performance since January 2016 and the Nasdaq posting its weakest month
since October 2016. On the economy front, the annual pace of growth in the US
was trimmed to 2.5% from 2.6% in the fourth quarter, leaving a picture of a
steadily growing economy intact. A slower inventory build accounted for the
downward revision. Every other key figure in the latest update to gross
domestic product was virtually unchanged. The increase in consumer spending,
for example, was left at 3.8%. For the full year, the US expanded 2.3% vs. a
1.6% increase in 2016. Meanwhile, Chicago PMI slipped in February to a reading
of 61.9, a six-month low, from 65.7 in January.
Any reading over 50 indicates improving conditions, so despite the
decline, the data indicates a strong level of activity. Firms did report a
slower pace of incoming orders and output. US manufacturing has been improving
of late, and the Chicago region is particularly exposed to automakers whose
fortunes have been helped by the need for replacements after the hurricanes.
The Dow Jones Industrial Average lost 380.83 points or 1.50 percent to
25,029.20, Nasdaq was down by 57.345 points or 0.78 percent to 7,273.01 and
S&P 500 dropped 30.45 points or 1.11 percent to 2,713.83.
Crude oil prices futures edged
lower on Wednesday as data revealed a weekly climb in U.S. crude stockpiles
that was larger than expected. Total domestic crude production also edged
higher after a modest decline in the previous week. The U.S. Energy Information
Administration (EIA) reported that domestic crude supplies rose by 3 million
barrels for the week ended February 23. Analysts had expected the EIA to report
a 1.2-million-barrel build in crude oil inventories. Gasoline stockpiles were
also up by 2.5 million barrels. That compares with a 300,000-barrel build in
the previous week. Production averaged 9.4 million bpd in the week to February
23, down from 10.1 million bpd a week earlier. Refineries operated at 87.8
percent of capacity, processing 15.9 million bpd of crude. Benchmark crude oil
futures for April delivery surged $1.37 or 2.2 percent at $61.64 a barrel on
the New York Mercantile Exchange. April Brent crude gained 85 cents or 1.3
percent to settle at $65.78 a barrel on London's Intercontinental Exchange.
Piling
on yesterday's loss, Indian rupee weakened further against the American
currency on Wednesday, following bouts of month-end dollar demand from banks
and importers amid continued capital outflows. Cautiousness remained in the
markets with report that growth in India's factory activity slowed to a
four-month low in February as new orders eased and weighed on output after
manufacturers raised prices at the fastest pace in a year. The Nikkei
Manufacturing Purchasing Managers' Index (PMI) fell to 52.1 in February from
January's 52.4. Traders also maintained cautious approach ahead of domestic
economic data including December quarter gross domestic product (GDP) to be
released later in the day. On the global front, dollar hit a three-week high on
Wednesday, after an upbeat assessment of the US economy by Federal Reserve
Chairman Jerome Powell's boosted bets on more interest rate hikes, while the
euro edged lower before inflation data. Finally, the rupee ended at 65.17, 28
paise weaker from its previous close of 64.89 on Tuesday.
The FIIs as per Wednesday's data
were net sellers in equity and debt segments both, in equity segment, the gross
buying was of Rs 4407.31 crore against gross sell of Rs 5282.16 crore, while in
the debt segment, the gross purchase was of Rs 1727.66 crore with gross sales
of Rs 2324.91 crore. Besides, in the hybrid segment, the gross buying was of Rs
0.14 crore against no selling.
The US markets closed sharply
lower on Wednesday, as traders expressed uncertainty about the outlook for
interest rates after new Federal Reserve Chairman Jerome Powell seemed to
suggest that the Fed may raise rates more than the three times currently
anticipated. Asian markets were trading mostly in red in early deals on
Thursday following the weak lead overnight from Wall Street amid worries about
interest rates. Indian markets edged lower on Wednesday, with weak cues from
global markets as well as disappointing manufacturing and fiscal deficit
numbers weighed on markets. Today, the start of the session is likely to be on
negative side on weak global cues. Traders will also remain cautious with
former RBI governor D Subbarao's statement where he cautioned against India's
deficit challenge and said the country is no longer the sweet spot due to
rising oil prices. Some anxiety will also persist during the trade after India
reported a fiscal deficit of Rs 6.77 trillion ($103.72 billion) for
April-January or 113.7 per cent of the target originally set for the fiscal
year that ends in March. However, traders may get some support with report that the Indian economy grew at
five-quarter high of 7.2% in the October-December period reflecting overall
recovery due to good show by agriculture, manufacturing, construction and
certain services. The economy is expected to grow at 6.6% in the current fiscal
ending March 31, as per the second advanced estimates of the Central Statistics
Office (CSO), compared to 7.1% in 2016-17. The earlier estimate was 6.5%. The
growth for the second quarter (July-September) has been revised upwards to
6.5%, from 6.3% estimated earlier by the CSO. Meanwhile, India's core sectors
grew at a faster clip in January from a year ago than in the previous month,
with an uptick in cement, electricity, coal, refinery products and steel
industries, indicating a strong start to the last quarter of 2017-18. The
combined index of the eight core industries rose 6.7% in January compared to
4.2% in December 2017. Some support may also come with Prime Minister's
Economic Advisory Council Chairman Bibek Debroy's statement that the economy is
on the right track and the current expansion in the growth rate suggests that
the reforms initiated by the government have started showing results.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,492.85
|
10,457.77
|
10,531.72
|
BSE Sensex
|
34,184.04
|
34,072.75
|
34,299.04
|
Nifty Top volumes
Stock
|
Volume
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Bharti Infratel
|
410.50
|
346.70
|
339.93
|
352.43
|
SBI
|
268.11
|
268.00
|
262.63
|
271.53
|
Reliance Industries
|
258.99
|
954.55
|
946.13
|
960.03
|
Bharti Airtel
|
233.61
|
428.55
|
425.13
|
432.73
|
ICICI Bank
|
174.82
|
313.25
|
310.57
|
316.47
|
Cipla has entered into a distribution agreement with Roche Pharma India to sell two key drugs in India.
Hero MotoCorp has accomplished a significant feat this month by crossing over One Million Registrations for its unique after-sales service offering - Hero Joyride Program.
Infosys' wholly owned subsidiary - Infosys Finacle has entered into partnership with Moneythor.
SBI has revised retail and bulk deposits rates by up to 0.75% for various maturities, with effect from February 28, 2018.