Bears made
strong come back on Dalal Street with major indices ending the Monday's trade
with a cut of around one and a half percent, breaching their crucial 11,500
(Nifty) and 38,000 (Sensex) levels. Markets started the session on pessimistic
note and never looked in recovery mood to end the session near intraday low
levels. Sentiments remained dampened, as traders reacted negatively to
President Donald Trump's statement that he wants to stop the subsidies that
growing economies like India and China have been receiving as he wants the US,
which he considers as a developing nation, to grow faster than anybody.
Sentiments also remained downbeat with the State Bank of India's (SBI) report
that with the currency losing more than 11% to the dollar this year, India will
have to shell out an extra Rs 68,500 crore when repaying short-term debt in the
coming months. Weakness in Indian rupee against dollar too dampened sentiments.
The rupee tumbled as much as 1.2% Monday, the most in a month, to a record low
of 72.5587, leading declines among Asia's emerging-market currencies. Adding to
the pessimism, Global rating agency Moody's Investors Service said that a
sustained weakening of the rupee would be credit negative for its rated Indian
companies. The rating agency added that it will have an adverse impact
particularly on those entities that generate revenue in rupees but rely on US
dollar debt to fund their operations and have significant dollar-based costs,
including capital expenses. Markets extended losses in second half of the
session with a report that total liabilities of the government increased to Rs
79.8 lakh crore at end-June 2018 from Rs 77.98 lakh crore at end-March 2018.
Public debt accounted for 89.3% of total outstanding liabilities at end-June
2018 with internal debt accounting for 83.0% share. Nearly 24.9% of the
outstanding dated securities had a residual maturity of less than five years.
Traders shrugged off the Reserve Bank of India's (RBI) data showing that India's
current account deficit (CAD) as a percentage of GDP declined marginally to
2.4% in the April-June quarter of 2018-19 against 2.5% in the year-ago period.
Market participants also paid no heed towards Economic affairs secretary
Subhash Chandra Garg's statement that the government will ensure fiscal deficit
target is not breached. Finally, the BSE Sensex declined by 467.65 points or
1.22% to 37,922.17, while the CNX Nifty was down by 151.00 points or 1.30% to
11,438.10.
The US markets ended mostly in
green, with the S&P 500 and the Nasdaq each snapping a four-day losing
streak, as technology shares tried to regain some of the steep losses from last
week, while Dow Jones Industrial Average settled marginally in red. Technology
stocks dropped nearly 3% last week as investors grappled with the possibility
of stronger regulation for social media companies. The day's gains were fairly
broad-based, with eight of the 11 primary S&P 500 industry groups finishing
in positive territory led by utilities and real estate. However, up-move
remained capped amid lingering trade concerns after President Donald Trump
ramped up trade tensions with China last Friday. Trump said that he was ready
to go on hitting China with an additional $267 billion worth of tariffs.
Further, traders seemed reluctant to make any significant moves amid a lack of
major US economic data. Reports on producer and consumer price inflation,
retail sales and industrial production as well as the Fed's Beige Book may attract
attention in the coming days. The S&P 500 gained 5.45 points or 0.19
percent to 2877.13 and Nasdaq added 21.62 points or 0.27 percent to 7924.16,
while Dow Jones Industrial Average dropped 59.47 points or 0.23 percent to
25857.07.
Crude oil futures ended lower on
Monday on the back of growing concerns that storms churning in the Atlantic
will hurt energy demand on the US East Coast. The market was showing concerns
about Hurricane Florence in the Atlantic and its potential to weaken energy
demand on the East Coast. As per the National Hurricane Center, the storm is
expected to approach the coast of South Carolina and North Carolina on
Thursday. However, crude prices continued to climb on expectations that renewed
sanctions on Iran will tighten the world's supply of oil. Benchmark crude oil
futures for October declined 21 cents or 0.3 percent to settle at $67.54 a
barrel on the New York Mercantile Exchange. November Brent crude gained 54
cents or 0.7% to settle at $77.37 a barrel on London's Intercontinental
Exchanged.
Breaching
the psychological 72 per dollar mark, Indian rupee ended at record low closing
level against dollar on Monday, hurt by fresh demand for the American currency
from importers. The rupee sentiments were hit after India's current account
deficit (CAD) widened to the most in five years. The CAD widened to $15.8
billion in the April-June quarter from a year ago due to a larger trade gap.
The CAD widened to 2.4% of gross domestic product (GDP) in April-June, from
1.9% of GDP in the January-March quarter. Sentiments also remained downbeat
with the State Bank of India's (SBI) report that with the currency losing more
than 11% to the dollar this year, India will have to shell out an extra Rs
68,500 crore when repaying short-term debt in the coming months. Besides, a
sharp sell-off in the domestic stock market largely led to weak rupee
sentiments. On the global front, dollar held largely steady against a basket of
major currencies on Monday thanks to strong US August jobs data and amid fears
of a possible escalation in the China-US trade conflict. Finally, the rupee
ended at 72.45, 71 paise weaker from its previous close of 71.74 on Friday.
The FIIs as per Monday'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 4850.98 crore against gross
selling of Rs 4713.20 crore, while in the debt segment, the gross purchase was
of Rs 805.75 crore with gross sales of Rs 1422.04 crore. Besides, in the hybrid
segment, there was no buying and selling.
The US markets ended mostly
higher on Monday on optimism for further tax relief; although gains were
limited as traders seemed reluctant to make any significant moves amid a lack
of major US economic data. Asian markets were trading mostly in red on Monday
as trade tensions between the US and China remained in focus. The Indian
markets registered their biggest single-day fall in almost six months on Monday
as renewed concerns over an escalation of trade war between the US and China
coupled with fall in the rupee that touched a new low weighted on the
investors' sentiment. Today, the markets are likely to make a cautious start on
Tuesday, amid weak trade in other Asian markets. Rupee will be in the main
focus. There will be some cautiousness with a private report that India's
economic growth is expected to moderate in the second half of this financial
year after a strong first quarter, owing to tighter financial conditions, high
oil prices and slowing global growth. It expects real GDP growth to slow to
7-7.3% in the second half of this fiscal from 8.2% in June 2018 quarter.
Traders will also be reacting to another private report that a depreciating
currency will impact the economy adversely, as India imports around 83% of its
crude oil requirement. A surge in the oil import bill can widen fiscal and
current account deficits. Traders will also be concerned about India
Meteorological Department's (IMD) data showing that the countrywide monsoon saw
the highest rain deficiency of the season in August -- ironically the month
when a large part of Kerala was submerged and many other states received excess
rainfall. There will be some buzz in the steel sector stocks with Moody's
Investors Service's statement that robust steel demand, especially from the
domestic construction, infrastructure and automotive sectors will keep
end-product prices high, even as rising costs for key inputs, coking coal and
iron ore pressure profitability. Meanwhile, Asian Development Bank (ADB) in its
latest report said India's share in the GDP of Asia and Pacific region has
increased to 17.3% in 2017 from 14.6% in 2000.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,438.10
|
11,385.93
|
11,531.63
|
BSE Sensex
|
37,922.17
|
37,751.83
|
38,223.52
|
Nifty Top volumes
Stock
|
Volume
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
432.96
|
323.65
|
316.80
|
329.70
|
Axis Bank
|
324.30
|
651.75
|
637.38
|
672.03
|
SBI
|
233.54
|
284.85
|
281.35
|
290.80
|
Tata Motors
|
213.23
|
275.70
|
270.97
|
281.22
|
Vedanta
|
182.60
|
223.50
|
219.20
|
230.80
|
Coal India's subsidiary -- MCL-- has complied with one of the two notices it received for violating environmental norms from Pollution Control Board Odisha.
NTPC's wholly owned subsidiary -- NTPC Vidyut Vyapar Nigam-- has started power supply of 300 MW to Bangladesh.
Yes Bank is eyeing to grow its retail loan book to between Rs 55,000-56,000 crore by 2019-20.
Tata Motors Group global wholesales in August 2018, including Jaguar Land Rover, stood at 1,07,030 units, higher by 14%, over August 2017.