Indian markets witnessed a
volatile trade on Wednesday when major averages after making a gap-down start
and remaining weak for most part of the day, gathered momentum in the final
hours to post gains of over half a percent. Earlier, the start was sluggish
tracking the weak global cues and lacking any support from domestic front.
Traders remained concerned with comments from Chief economic adviser Arvind
Subramanian, who in an effort to put some pressure off the RBI, said that we
should not peg all the hopes on a rate cut by the Reserve Bank of India to cure
the economy from all that plagues it. However, markets got some support with
Finance Minister Arun Jaitley's statement that Indian economy is improving,
also the Moody's Investors Service stated that though the prolonged decline in
oil prices and weaker expansion in Chinese economy have dimmed growth prospects
of several economies, but it does not signal a threat of global recession. It
said that the positive impact of lower commodity prices on global growth helps
mitigate the negative effect from the financial market turbulence. The Indian
rupee too made a good bounce back against US dollar and supported the equity
markets. The global cues remained mixed and after a weak closing of the US
markets, the Asian markets followed the trend on worries emanating from China
and decline in crude oil prices. The European markets made a strong start but
soon gave up their gains. Back home, markets that looked weak in the morning
after a flat closing in the last session, made a good comeback in the late hour
of trade, following strong cues from the European markets, though the bourses
came off the intraday low levels in the very noon deals, paring all their
losses but remained rangebound, with intermittent attempt to enter the green.
Later there was good bounce back in the banking stocks that took the bourses
higher. Finally, the BSE Sensex gained 134.73 points or 0.55% to 24,793.96,
while the CNX Nifty ended higher by 46.50 points or 0.62% to 7,531.80.
The US markets closed higher on
Wednesday, as a rally in oil prices and sharp advances in energy and tech
stocks kept the main indexes buoyant. Investors are awaiting the European
Central Bank policy meeting set for Thursday, which will have implications for
US investors. On the economy front, US wholesale inventories unexpectedly rose
in January as sales tumbled, suggesting that efforts by businesses to reduce an
inventory overhang could persist well into 2016 and restrain economic growth.
The wholesale inventories increased 0.3 percent in January. December
inventories were revised up to show them unchanged instead of the previously
reported 0.1 percent dip. The Dow Jones Industrial Average added 36.26 points
or 0.21 percent to 17,000.36, the Nasdaq was up 25.55 points or 0.55 percent to
4,674.38 while, the S&P 500 gained 10.00 points or 0.51 percent to
1,989.26.
Crude oil futures surged, hitting
their best levels of 2016 on Wednesday and recovering more than what they had
lost in previous session, following the release of inline US supply report. The
US Energy Information Administration (EIA) reported a 3.9 million-barrel rise
in crude oil stockpiles for the week ending March 4. Motor gasoline inventories
fell by 4.5 million barrels in line with seasonal patterns. US crude production
ticked up by 1,000 barrels per day to 9.078 million bpd, halting a skid of six
consecutive weekly declines. Benchmark crude oil futures for April delivery surged
by $1.69 or 4.63percent to $38.23 a barrel after trading in a range of $36.25
and $38.44 a barrel on the New York Mercantile Exchange. In London, Brent crude
for May delivery closed at $ 41.01, up $1.36 or 3.43 percent on the ICE.
Indian rupee, which started off
on a weaker note, recouped all its losses and ended stronger on Wednesday on
the back of gains in local equities. Besides, selling of American currency by
banks and exporters also added to the positive milieu of rupee. Sentiment
further got some support from Finance Minister Arun Jaitley's statement that
the Indian economy is improving. On the global front, safe-haven yen was
broadly higher amid anxiety about a slowdown in China and euro underperformed
and was weaker ahead of European Central Bank meeting on Thursday. Finally, the
rupee ended at 67.21, 13 paise stronger from its previous close of 67.34 on
Tuesday.
The FIIs as per Wednesday's data
were net buyers in equity segment while they were net sellers in debt segment. In
equity segment, the gross buying was of Rs 7085.01 crore against gross selling
of Rs 6310.85 crore, while in the debt segment, the gross purchase was of Rs 522.17
crore with gross sales of Rs 989.76 crore.
The US markets made a positive
close in last session, partly offsetting the weakness that was seen in the
previous session, as oil after a sharp plunge rebounded. However, overall
trading activity remained somewhat subdued amid another relatively quiet day on
the US economic front. The Asian markets have made mostly a positive start
taking cues from the US markets, though the Chinese market was trading lower on
report that consumer prices in China were up 2.3 percent on year in February,
however producer prices were down 4.9 percent on year - in line with
expectations. The Indian markets showing a smart recovery in the final hours,
ended higher in last session. Today, the start is likely to be in green and the
markets continuing their momentum will extend the gains. Traders will be
getting some encouragement with Prime Minister Narendra Modi making a fresh
pitch for passage of GST and other legislations in the Rajya Sabha, considering
the 'conducive atmosphere' that has been prevailing in Parliament this session
with cooperation from the opposition. Also, the Commerce Ministry has informed
that Investment commitments worth $45.68 billion have been made through Foreign
Direct Investment (FDI) inflows after the launch of 'Make in India' initiative
in September, 2014. The Ministry also pointed out that a little over 90 per
cent of the total FDI received during April-December 2016 came through
automatic route. Meanwhile, the Finance Ministry has said that the government
will set up a panel in a month to look into the feasibility of setting a range
for fiscal deficit targets rather than a fixed figure. Pharma stocks will be in
action, as a high level panel, in order to bring down drug prices, has
recommended capping the trade margins at 35 percent on all the drugs with MRP
of above Rs 50. For drugs priced between Rs 20-50, the panel has proposal to
cap the margin at 40 percent.
Support
and Resistance: NSE Nifty and BSE Sensex
Index
|
Previous close
|
Support
|
Resistance
|
CNX Nifty
|
7531.80
|
7457.73
|
7572.43
|
BSE Sensex
|
24793.96
|
24556.79
|
24925.95
|
Nifty Top volumes
Stock
|
Volume
(in Lacs)
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
SBI
|
294.53
|
183.40
|
180.07
|
185.37
|
Vedanta
|
247.2
|
87.85
|
85.35
|
89.35
|
Bank of Baroda
|
186.1
|
143.05
|
140.60
|
144.45
|
ICICI Bank
|
157.28
|
216.35
|
211.63
|
219.48
|
ITC
|
134.19
|
319.90
|
314.83
|
322.83
|
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