A session after displaying a
distressing performance, Indian benchmark indices managed to pull through a
scintillating performance by vivaciously rallying around a percent on
Wednesday, thanks to the hefty short covering in the beaten down blue chip counters.
Sentiments got some support with the report that the government is likely to
meet its fiscal deficit target of 3.9 per cent of the GDP for the current
financial year, largely on account of the latest round of excise duty hikes on
oil products and marginal compression in expenditure. Furthermore, market
participants also got some light with the report that International development
banks from South Korea, Japan and Germany have shown interest in funding
multibillion-dollar industrial corridors coming up across the country. These
belts with special manufacturing clusters and smart cities are expected to spur
economic growth. Some support also came
with Union Commerce and Industry Minister Nirmala Sitharaman's statement that
the FDI inflows in the country are improving day by day and more and more
investments are coming from sectors other than IT and ITeS. However, investor
remained cautious with exporters body FIEO's observation after exports fell for
the 14th month in a row, that the country may end up with outbound shipments of
$260 billion in 2015-16, sharply lower than the $ 310.5 billion mark achieved
in the previous fiscal. Market participants also remained concerned with report
that foreign portfolio investors (FPIs) selling shares worth a net Rs 964.19
crore on February 16, 2016. Besides, the Indian rupee depreciated to near
record lows against the American dollar, forcing the RBI to intervene to stem
further falls, also weighing on the sentiment. The rupee dropped to as low as
68.67 to the dollar, not far from a record low of 68.85 hit in August 2013 when
India was hit with its worst financial turmoil in the recent times. On the
global front, Asian stocks declined, while shares were higher in Europe as oil
prices stabilized. Back home, after the subdued opening, the key gauges plunged
to lowest point in the day on sharp across the board sell-off. Thereafter
started the recovery to the bourses, which kept moving higher slowly but
steadily. Second half of the session saw the key gauges capitalize on the
momentum further and spurt to session's highest levels in dying moments. Finally,
the BSE Sensex surged by 189.90 points or 0.82% to 23381.87, while the CNX
Nifty rose 60.20 points or 0.85% to 7,108.45.
The US markets closed higher on
Wednesday, allowing the benchmark S&P 500 to post its biggest three-day
gain since August. Solid gains came as the minutes from the Federal Reserve's
January policy meeting suggested that policy makers are inclined to pause the
tightening process due to recent market turmoil. The majority of Fed officials
agreed that the best policy would be to wait for additional information about
the strength of the economy before making any further attempts to raise interest
rates in 2016. On the economy front, wholesale prices picked up more than
expected in January, a possible sign that the global glut in commodities and
energy may be abating. The producer price index rose 0.1% in January, a much
stronger reading than the 0.2% decline expected. The core price index, which
strips out volatile categories like food and energy, was up 0.4% for the month
and 0.6% compared to a year ago. Meanwhile, US industrial production rose in
January after three straight months of declines, buoyed by a strong utilities
index and growing manufacturing sector. The Dow Jones Industrial Average added
257.42 points or 1.59 percent to 16,453.83, the Nasdaq was up 98.11 points or
2.21 percent to 4,534.07 while, the S&P 500 gained by 31.24 points or 1.65
percent to 1,926.82.
Crude oil futures extending their
gains surged on Wednesday on report that Iran backed plans by Russia and Saudi
Arabia to cap crude oil production at January levels. Meanwhile, Iranian Oil
Minister Bijan Zanganeh met counterparts from Venezuela, Iraq and Qatar in
Tehran on Wednesday but did not say if Iran would cap output at January's
levels in keeping with moves by major producers Russia, Saudi Arabia and Iraq
to limit production. It backed the plan without specifying whether it will
immediately freeze its own production levels. Benchmark crude oil futures for
March delivery surged by $1.62 or 5.6 percent to $30.66 a barrel after trading
in a range of $30.64 and $31.23 a barrel on the New York Mercantile Exchange.
In London, Brent crude for April delivery closed at $34.52, up $2.35 or 7.28
percent on the ICE.
India rupee wiped off its early
losses, but still ended weaker against dollar on Wednesday due to increased
demand for the American currency from importers, amid weak cues from Asian
currency markets. Besides, dollar's strength against some other currencies
overseas also weighed on the rupee. However, gains in equity markets, which
despite some choppiness managed a positive close capped some losses. Investors
remained cautious with exporters body FIEO's observation after exports fell for
the 14th month in a row, that the country may end up with outbound shipments of
$260 billion in 2015-16, sharply lower than the $310.5 billion mark achieved in
the previous fiscal. On the global front, yen outperformed as a rebound in oil
prices fizzled out, underpinning demand for the safe-haven Japanese currency. Finally, the rupee ended at 68.47, 9 paise
weaker from its previous close of 68.38 on Tuesday.
The
FIIs as per Wednesday's data were net sellers in equity segment, while they
were net buyer in debt segment. In equity segment, the gross buying was of Rs 2941.75
crore against gross selling of Rs 3730.46 crore, while in the debt segment, the
gross purchase was of Rs 298.17 crore with gross sales of Rs 76.31 crore.
The US markets extended their
rally, moving sharply higher over the course of the trading day in last session
as there was report of much bigger than expected increase in industrial production
in the month of January. Traders also got support with rise in crude prices on
report that Iranian Oil Minister has offered support for a plan to maintain a
ceiling on oil production. The Asian markets have made a strong start tailing
the surge in US markets, with some of the indices gaining over 2 percent as
oil's second day of gains bolstered sentiment. The Indian markets after a
choppy trade managed to post gains of around a percent in last session. Today,
the start is likely to be extension of the gains amid jubilant global cues.
Traders are likely to get some support with Cabinet's approval for the WTO's
Trade Facilitation Agreement (TFA) which aims at easing customs procedures to
boost commerce. TFA will contain provisions for movement of goods, release and
clearance of goods and goods in transit. Also, as Revenue Secretary Hasmukh
Adhia has indicated that the Centre will announce a final roadmap for
rationalising corporate tax exemptions in the Union Budget 2016-17. The
aviation stocks will be in focus, as the senior officials of leading airlines
IndiGo, Jet Airways, SpiceJet and GoAir have met Minister of State (PMO)
Jitendra Singh demanding level playing field with the foreign and the new
airlines in the draft civil aviation policy released last year. There will be
some buzz in the pharma stocks too on report that department of Pharmaceuticals
under the Ministry of Chemicals and Fertilizers is expected to come out with a
new bulk drug policy in less than a month with an objective to grow the Indian
pharmaceuticals sector to a $200 billion industry by 2030.
Support
and Resistance: NSE Nifty and BSE Sensex
Index
|
Previous close
|
Support
|
Resistance
|
CNX Nifty
|
7108.45
|
7004.83
|
7167.88
|
BSE Sensex
|
23381.87
|
23056.84
|
23570.91
|
Nifty Top volumes
Stock
|
Volume
(in Lacs)
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
SBI
|
324.48
|
158.95
|
153.52
|
162.12
|
Vedanta
|
288.9
|
74.40
|
69.15
|
77.30
|
Bank of Baroda
|
275.15
|
138.30
|
129.58
|
143.73
|
ICICI Bank
|
261.75
|
190.75
|
187.35
|
195.65
|
Tata Motors
|
137.18
|
310.15
|
301.37
|
316.22
|
Idea Cellular has signed agreement with Ericsson to deploy 4G/LTE network in select circles and transform the firm's existing 2G and 3G infrastructures.
TCS has launched Digital Reimagination Studio in Santa Clara, designed to help customers and partners rapidly ideate bold new innovations and build industry changing concepts.
Bharti Airtel, a leading global telecommunications company with operations in 20 countries across Asia and Africa, has added 25.00 lakh users in January, 2016.
South Eastern Coalfields, a subsidiary of the Coal, would be setting up country's largest coal washery with a capacity of 25 million tonnes per annum in Korba district of Chhattisgarh.
A consortium of infra majors L&T, Japan-based Sojitz and Gayatri may bag a project of over Rs 4,700 crore for civil construction work of the Iqbalgarh-Vadodara stretch of the Western rail freight corridor.