Indian equity benchmarks
continued to flourish in energetic way on the last trading day of the week,
with Sensex and Nifty closing higher by around 1% each. After a bullish start,
key indices maintained their gaining momentum during the whole day, as Finance
Minister Nirmala Sitharaman assured that the Centre will honour GST
compensation payment to states but did not say by when the dues will be
cleared. Investors also remained positive with Union Minister Rao Inderjit
Singh's statement that Indian economy is resilient and there is no cause for
apprehension on decline in GDP with a slew of steps directed at boosting it. He
added that the government has been undertaking various measures to boost GDP
growth. Extending their gains, key indices settled the session near intraday
high points. Optimism remained over the street, even though Moody's Investors
Service lowered its 2019 GDP growth forecast for India to 5.6 per cent as slow
employment growth weighs on consumption. It expects economic growth to pick up
in 2020 and 2021 to 6.6 per cent and 6.7 per cent respectively, but sees the
pace of growth remaining lower than past. The street also overlooked sluggish
microeconomic data i.e. India's factory output growth which shrunk by 3.8% in
October 2019 as competed to expansion of 8.4% in October 2018, while retail
inflation based on Consumer Price Index surged to a more than three-year high
of 5.54% in November. Finally, the BSE Sensex gained 428.00 points or 1.05% to
41,009.71, while the CNX Nifty was up by 114.90 points or 0.96% to 12,086.70.
The US markets ended marginally
higher on Friday after President Donald Trump and Chinese officials announced a
trade pact that includes a rollback of some tariffs, the scrapping of further
duties originally set for Sunday, and promises of targeted US agricultural
purchases by China. Trump said more US import duties that were planned to start
from Sunday on more than $150 million in annual consumer goods will not be
charged because of the fact we made the deal. Trump also said China would most
likely buy $50 billion of farm goods. Besides, the US Trade Representative said
that the United States and China have reached an historic and enforceable
agreement on a Phase One trade deal that requires structural reforms and other
changes to China's economic and trade regime in the areas of intellectual
property, technology transfer, agriculture, financial services, and currency
and foreign exchange. On the economic data front, a report released by the
Commerce Department showed retail sales in the US rose by far less than Street
had anticipated in the month of November. The Commerce Department said retail
sales edged up by 0.2 percent in November after climbing by an upwardly revised
0.4 percent in October. The uptick in retail sales was partly due to continued
growth in sales by motor vehicles and parts dealers, which rose by 0.5 percent
in November after jumping by 1.0 percent in October. Meanwhile, business
inventories in the US increased in line with Street estimates in the month of
October, according to a report released by the Commerce Department. The
Commerce Department said business inventories rose by 0.2 percent in October
after edging down by a revised 0.1 percent in September.
Extending their previous session
gains, crude oil futures ended higher on Friday after the US and China said
they have reached a preliminary agreement on a phase one trade agreement.
Private report said that China confirmed that it reached a deal on the text of
a phase one pact, but that the deal would need to first go through legal
procedures before it is signed. Trump separately announced a phase one deal and
scrapped tariffs on Chinese goods that were set to go into effect on Sunday.
Benchmark crude oil futures for January rose 89 cents or 1.5 percent to settle
at $60.07 a barrel on the New York Mercantile Exchange. February Brent surged
$1.02 or 1.6 percent to settle at $ 65.22 a barrel on London's Intercontinental
Exchange.
Indian
rupee ended unchanged compared to its previous close on Thursday. Traders
remained wary as Moody's Investors Service lowered its 2019 GDP growth forecast
for India to 5.6 per cent as slow employment growth weighed on consumption. It
expects economic growth to pick up in 2020 and 2021 to 6.6 per cent and 6.7 per
cent respectively, but sees the pace of growth remaining lower than past.
However, firm domestic equities supported the domestic currency. Some support
also came with Union Minister Rao Inderjit Singh's statement that Indian
economy is resilient and there is no cause for apprehension on decline in GDP
with a slew of steps directed at boosting it. He added that the government has
been undertaking various measures to boost GDP growth. On global front, dollar
edged lower on Friday, with global risk appetite boosted by the apparent
clearing of two clouds that have been hanging over world markets -- US-China
tariffs due on December 15 and Britain's election. Finally, the rupee ended
unchanged from its previous close of 70.83 on Thursday.
The
FIIs as per Friday's data were net sellers in equity segment, while they were
net buyers in debt segment. In equity segment, the gross buying was of Rs
4587.82 crore against gross selling of Rs 5202.78 crore, while, in the debt
segment, the gross purchase was of Rs 2822.41 crore with gross sales of Rs
2212.96 crore. Besides, in the hybrid segment, the gross buying was of Rs 4.89
crore against gross selling of Rs 5.63 crore.
The US markets ended slightly
higher on Friday as the United States and China announced an initial trade
agreement, cooling tensions that have rattled markets. Asian markets are
trading mixed on Monday as investors cheered an announced trade agreement
between Beijing and Washington over the weekend although jubilation was capped
by prevailing scepticism about the deal. Indian markets ended higher on Friday
on the back of a slew of positive developments globally. Today, the start of
new week is likely to be flat-to-negative amid mixed cues from Asian peers
coupled with weak exports data. As per the government data, India's exports
contracted for the fourth month in a row in November, dipping 0.34% to $25.98
billion, mainly on account of poor shipments of petroleum, gems & jewellery
and leather products. Imports too declined by 12.71% to $38.11 billion in
November, narrowing the trade deficit to $12.12 billion. Market participants
will be eyeing the data on Wholesale Price Index (WPI) inflation for November
to be released later in the day. Also, investors will be looking ahead to the
38th Goods and Services Tax (GST) Council meeting to be held on December 18.
The Council is expected to deliberate on an alternative mechanism for the
compensation cess, and look at ways to boost revenue from indirect taxes.
However, some respite may come later in the day with the Reserve Bank of
India's (RBI) data showing that India's services exports rose 5.25% to $17.70
billion in October, while imports remained nearly flat at $10.86 billion. Some
support may also come with report that the country's foreign exchange reserves
surged by $2.342 billion to touch a life-time high of $453.422 billion in the
week to December 6. Traders may take note of NITI Aayog CEO Amitabh Kant's statement
that the series of pathbreaking and ambitious reforms unleashed by the Modi
government in the last few years will make India a very competitive and
productively-efficient economy in the long run. Meanwhile, beginning the
customary pre-Budget consultation exercise from December 16, Finance Minister
Nirmala Sitharaman will seek inputs from various stakeholders including
industry bodies, farmer organisations and economists for reviving consumption
and boosting growth. There will be some buzz in the banking stocks with rating
agency Moody's report that banks may see a spike in bad loans because of stress
in the non-banking financial company (NBFC) sector and it warned that the trend
of improvement in key bank metrics is likely to reverse or slow. Reality stocks
will be in focus with a private report indicating that housing sales are
estimated to rise by mere 4% to 2.58 lakh units across seven major cities
during this calendar year on subdued demand because of liquidity crunch and
overall economic slowdown. There will be some reaction in sugar stocks with
report that India exported about 37 lakh tonne of sugar in the 2018-19
marketing year ended September to clear the surplus stock.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
12,086.70
|
12,040.58
|
12,115.83
|
BSE Sensex
|
41,009.71
|
40,812.34
|
41,131.44
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
2,014.60
|
46.65
|
45.48
|
47.73
|
Tata Motors
|
930.20
|
176.70
|
173.48
|
181.93
|
SBIN
|
409.55
|
332.55
|
327.22
|
335.67
|
Tata Steel
|
216.28
|
428.40
|
423.03
|
434.18
|
Vedanta
|
202.97
|
149.40
|
147.77
|
150.87
|
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