Indian equity markets prolonged
the weakness for second straight day finished the session on a dull note, amid
lack of global as well as domestic cues. Sentiments remained subdued with the
report that the current account deficit soared to $3.4 billion, or 0.6 per cent
of gross domestic product (GDP), in the fourth quarter of financial year 2017,
from $0.3 billion a year ago. Balance of payments for the full financial year
stood at $21.6 billion, while for Q4 the same stood at $7.31 billion. Some
concerns also came with report that foreign portfolio investors (FPIs) sold
shares worth a net Rs 645.35 crore on June 15, 2017. However, the downside for
the markets was capped with the report that India's exports grew 8.32 per cent
to $24.01 billion in May, mainly on account of robust performance by sectors
like petroleum, chemicals, engineering goods as well as gems and jewellery.
Some support also came with the report that government is looking to clear FDI
proposals in the 11 sectors, such as defence, insurance and telecom, where
approval is still required within eight to 10 weeks of receipt of application
to boost the investment climate after the abolition of the Foreign Investment
Promotion Board (FIPB). Meanwhile, sharp correction was witnessed in Healthcare
and IT counters, while index heavyweights such as ITC, Tata Motors continued to
support the market. Technology stocks declined on worries over outlook at a
time when US President Donald Trump is contemplating tougher visa actions in a
key market for software services exporters, while Pharma stocks slipped amid
worries about their earnings outlook, because of pricing pressures in the
United States. Finally, the BSE Sensex declined 19.33 points or 0.06% to 31056.40,
while the CNX Nifty was up by 10 points or 0.1% to 9,588.05.
The US markets closed mostly
higher on Friday, though the tech-heavy Nasdaq Composite ended lower and booked
a second-straight weekly loss, extending what has proven a painful weekly stretch
for tech highfliers. On the economy front, consumer sentiment measured by the
University of Michigan slipped in June to the lowest level since the
presidential election in November, but the modest decline masked a sharper drop
in the gauge just since June 8, after former FBI Director James Comey testified
to Congress on his dealings with President Trump. The UMich consumer sentiment
gauge fell to 94.5 in early June from 97.1 in May. Prior to the testimony, the
sentiment index had averaged 97.7, but since June 8 the index registered at
86.7, a decline of 11 points. Construction on new houses fell in May for the
third month in a row even though builders are optimistic about the economy,
perhaps a sign a shortage of skilled workers is holding the industry back. The
Dow Jones Industrial Average added 24.38 points or 0.11 percent to 21,384.28,
S&P 500 edged higher by 0.69 points or 0.03 percent to 2,433.15, while
Nasdaq was down 13.74 points or 0.22 percent to 6,151.76.
Crude oil futures though managed
to snap the losing streak on Friday but ended the week lower by over two
percent, held down by an ongoing supply overhang that persists despite an
OPEC-led effort to cut production and prop up crude markets. Rising US oil
output, particularly from shale drillers, is contributing to the
ineffectiveness of the OPEC-led cuts. In the United States, which is not
participating in any deal to hold back production, oil output has risen more
than 10 percent over the past year to 9.3 million bpd. Meanwhile, the oil
services firm Baker Hughes said the US rig count rose by 6 to 747, the most
since April 2015. The US oil rig count rose for the 22nd week in a row.
Benchmark crude oil futures for July delivery ended higher by $0.28 or 0.6
percent to $44.74 on the New York Mercantile Exchange. In London, Brent crude
for July delivery ended up by $ 0.32 to $47.24 on the ICE.
Recovering
from its initial losses, Indian rupee ended stronger against dollar on Friday,
owing to dollar sale by exporters and banks. Sentiments remained positive as
India's exports grew 8.32 per cent to $24.01 billion in May, mainly on account
of robust performance by sectors like petroleum, chemicals, engineering goods
as well as gems and jewellery. Some support also came with the report that
India has moved up six places from 66th in last year to reach 60th position in
this year's Global Innovation Index (GII). However, gains were muted as the
current account deficit (CAD) soared to $3.4 billion or 0.6 per cent of gross
domestic product (GDP), in the fourth quarter of fiscal 2017, from $0.3 billion
a year ago. On the global front, US Dollar recorded a two-week high against
major global currencies backed by positive economic data. Finally, the rupee
ended at 64.43, 11 paise stronger from its previous close of 64.54 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 5018.68 crore against gross sell
of Rs 5628.88 crore, while in the debt segment, the gross purchase was of Rs
701.26 crore with gross sales of Rs 215.83 crore.
The US markets ended modestly in
red in the last session on another round of downbeat economic data .The Asian
markets have made a green start and many of the indices in the region are up by
over half a percent. There was some relief with a member of the US president's
legal team stating that President Donald Trump isn't under investigation by
special counsel Robert Mueller. The Indian markets after much of dilly-dallying
made a flat closing in the last session. Decline in IT and healthcare stocks offsetted
a rebound in banking stocks. Today, the start of the new week is likely to be
in green tailing the positive regional cues. Traders will also be getting some
support with the GST Council fixing nagging issues and the government putting
at rest speculation about a possible delay in GST rollout. Also, the Finance
Minister Arun Jaitley said the government will let companies to file late
returns for the first two months to let them adapt to a new system. Meanwhile,
the industry body Confederation of Indian Industry (CII) said India Inc is
ready for the implementation of the Goods and Services Tax (GST) from July 1,
as the new indirect tax regime will contribute significantly towards economic
growth, job creation and exports expansion. Though, another industry body Assocham
has demanded postponing GST implementation, saying that taxpayers will find it
difficult to comply with the provisions of the new indirect tax regime as the
IT network is not yet ready. The banking sector stocks will be in action, as
the bankers are meeting from today to finalise their next course of action on
six of the 12 bad loan accounts for immediate referral to NCLT after the RBI
named the largest defaulters to face bankruptcy proceedings. There will be some
buzz in the steel sector, as the Centre has said it will ensure that steel
products are not imported in the guise of utensils or finished products. India
has been successful in reducing import of steel by 37 percent during 2016-17.
Support and Resistance: NSE (Nifty) and BSE
(Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
9588.05
|
9563.75
|
9614.10
|
BSE Sensex
|
31056.40
|
30988.14
|
31153.69
|
Nifty Top volumes
Stock
|
Volume
(in Lacs)
|
Previous close (Rs)
|
Support
(Rs)
|
Resistance (Rs)
|
ICICI Bank
|
211.17
|
316.50
|
315.02
|
318.62
|
SBI
|
192.47
|
285.95
|
283.92
|
287.32
|
ITC
|
123.24
|
306.80
|
303.00
|
310.10
|
Vedanta
|
108.43
|
236.80
|
234.95
|
238.70
|
Aurobindo Pharma
|
97.86
|
653.70
|
646.63
|
662.13
|
HCL Technologies is planning to hire around 2,000 people at the global IT centre being set up in Nagpur.
Tata Motors is planning to raise up to Rs 500 crore through rated, listed, unsecured, redeemable non-convertible debentures.
IndusInd Bank has acquired the equity shares of Kesoram Industries pursuant to conversion of Optionally Convertible Redeemable Preference Shares.
Axis Bank has received its board's approval to raise Rs 5,000 crore by issuing bonds on a private placement basis.