Indian equity indices showcased a
courageous performance and went on to outclass indices around the world by
vivaciously rallying by close to a percent in the session and settled above the
psychological 9,600 (Nifty) and 31,200 (Sensex) levels. Sentiments got a boost
with report that the government has ramped up capital spending by nearly 60% in
the first two months of the current financial year, in a bid to perk up
investment sentiment and crowd in private investment. Early passage of the
budget in March has allowed the government start spending from the beginning of
the new financial year in April. In April-May, the government spent Rs 52,536
crore, 58% more than the year earlier period.
Adding optimism among investors, Moody's said GST will be credit
positive for India. Implementation of the goods and services tax (GST) will be
positive for India's rating as it would lead to higher GDP growth and increased
tax revenues. Some support also came with IMD report indicating that the first
month of monsoon has been heartening with India recording a 4% surplus in
rainfall combined with a well-distributed pattern, except in the eastern
regions. The average rainfall in June was 170.2mm, 7mm higher than the usual
163.6mm. Traders paid no heed to the report stating that manufacturing activity
in India fell to a four-month low in June amid softer rise in factory new
orders. The seasonally adjusted Nikkei India Manufacturing Purchasing Managers'
Index (PMI)-a composite single-figure indicator of manufacturing
performance-slipped to 50.9 in the month of June as against 51.6 in the month
of May. Finally, the BSE Sensex gained 300.01 points or 0.97% to 31221.62,
while the CNX Nifty was up by 94.10 points or 0.99% to 9,615.00.
The US markets closed mostly
higher on Monday, on the first day of trading in July and the second half of
2017 in positive territory - though off the day's best levels - on the back of
a rally in energy and financials, but tech shares lagged behind. Gains
accelerated in an abbreviated session ahead of holiday on Tuesday, after an
upbeat report on manufacturing. American manufacturers are growing at the
fastest pace in almost three years, reflecting improved economic conditions
both at home and abroad. The Institute for Supply Management said its
manufacturing index rose to 57.8% in June from 54.9%. That's the highest
reading since mid-2014. Some 15 of 18 industries tracked by ISM said they grew
in June. Separately, construction spending in May was virtually unchanged when
compared with upwardly revised April data. Outlays for all construction ran at
a seasonally adjusted annual rate of $1.23 trillion, about 1% higher than
April's pace, which was originally reported as $1.22 trillion. The Dow Jones
Industrial Average added 129.64 points or 0.61 percent to 21,479.27, S&P
500 edged higher by 5.6 points or 0.23 percent to 2,429.01, while Nasdaq
dropped 30.36 points or 0.49 percent to 6,110.06.
Crude oil futures continued their
upmove on for the eighth straight session, the longest such streak in months
and ended up by over two percent on Monday, after data pointed to diminished US
output, though analysts said news of rising OPEC production could cap gains. Meanwhile,
traders continued getting support with report that the U.S. rig count fell last
week for the first time in about five months, while US government data showed
crude output fell in April for the first time this year. Benchmark crude oil
futures for August delivery surged by $1.03 or 2.2 percent to $47.07 on the New
York Mercantile Exchange. In London, Brent crude for August delivery ended up
0.91 cents at $49.68 a barrel on the ICE.
Starting the new month on a weak
note, Indian rupee extended losses and ended considerably weaker against US
dollar on Monday, on account of selling of American currency by banks and
exporters. Sentiments remained subdued with report that the growth of eight
core sectors slowed to 3.6% in May, as against 5.2% in May last year, due to
fall in output of coal and fertiliser. Also, activity in India's manufacturing
sector eased to a four-month low of 50.9 in June, as against 51.6 in the month
of May, amid a slowdown in output and new orders as softer domestic consumption
partly offset strong foreign demand. Besides, firm dollar against a basket of
other currencies overseas too added pressure on the domestic unit. Finally, the
rupee ended at 64.87, 30 paise weaker from its previous close of 64.57 on
Friday.
The
FIIs as per Monday's data were net buyers in equity and debt segments both. In
equity segment, the gross buying was of Rs 5833.55 crore against gross selling
of Rs 4378.89 crore, while in the debt segment, the gross purchase was of Rs
1463.01 crore with gross sales of Rs 765.03 crore.
The US markets made a mixed
closing in the last session following the release of a report from the
Institute for Supply Management showing acceleration in the rate of growth in
the U.S. manufacturing sector, while construction spending was unchanged in May.
The Asian markets have made a mixed start and some of the indices were down by
about half a percent. The Japanese market too has given up most of the gains
after the yen briefly spiked on a report that North Korea launched a missile. The
Indian markets rallied in last session on expectations that the biggest tax
reform in independent India will support higher government revenue generation,
after the goods and services tax (GST) kicked in on July 1. Today, the start is
likely to be in green and the markets may extend the gains, despite sluggish
global cues. Also, Chief Economic Adviser to Finance Ministry Arvind Subramanian
has asked to wait till fiscal end before assessing GST impact. Meanwhile,
Railway Minister Suresh Prabhu has termed the Goods and Services Tax as a great
unifying factor, both in societal and political spheres in the country. Markets
may get some support with reports that India has told the World Bank that it
has improved processes for granting construction permits sufficiently to pip
the current topper, New Zealand, in the next edition of the Doing Business
report. India was ranked 185 among 190 nations surveyed on the parameter of
getting a construction permit in the study conducted last year. There will be
some buzz in the oil stocks, as the International Energy Agency (IEA) has said
that emerging and developing countries in Asia, particularly China and India
will account for about 90 per cent of the net increase in road freight oil
demand till 2050.
Support and Resistance: NSE (Nifty) and BSE
(Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
9615.00
|
9564.37
|
9644.82
|
BSE Sensex
|
31221.62
|
31073.04
|
31314.26
|
Nifty Top volumes
Stock
|
Volume
(in Lacs)
|
Previous close (Rs)
|
Support
(Rs)
|
Resistance (Rs)
|
ITC
|
470.80
|
342.50
|
336.93
|
351.43
|
Hindalco
|
138.51
|
196.65
|
192.63
|
199.23
|
Vedanta
|
114.91
|
254.30
|
251.30
|
256.40
|
SBI
|
89.51
|
274.85
|
273.10
|
276.05
|
Bank of Baroda
|
88.63
|
161.85
|
159.93
|
164.38
|
Mahindra & Mahindra has reported its auto sales performance for June 2017 which stood at 35,716 vehicles, compared to 39,009 vehicles during June 2016.
Coal India has reported provisional production of 39.66 million tonnes in June 2017, as against a target of 43.18 million tonnes.
Maruti Suzuki India has slashed prices of its models by up to 3 per cent with immediate effect in order to pass on GST benefit to its customers.
Bajaj Auto has registered a fall of 23% in total sales to 244,878 units in June 2017 against 316,969 units in June 2016.