Extending previous session's
southward journey, Indian equity benchmarks ended the session slightly in red
on Tuesday. Soon after a positive start, markets entered into red terrain, as
traders reacted negatively to SBI Research report which highlighted that if the
UP government fulfills its farmer loan waiver promise, banks are likely to take
a hit of Rs 27,420 crore and the scheme will lead to some stress on the state's
fiscal arithmetic. The BJP had in its UP election manifesto promised to waive
farmers' loans if elected to power. The report said that schedule commercial
banks together had an outstanding farm credit of Rs 86,241.20 crore in UP with
the average ticket size of Rs 1.34 lakh, as of 2016, most of which is to small
and marginal farmers. However, some
recovery took place in last leg of trade and pared most of their initial
losses, as investors opted to buy beaten-down but fundamentally strong stocks.
Traders took some support with report that Cabinet cleared four supporting GST
legislations, paving the way for their introduction in Parliament. Once
approved by Parliament, the states would start taking their SGST bill for
discussion and passage in the respective state assemblies. Positive opening in
European markets too provided some support, as investors eyed rising oil prices
and intensifying talks between Greece and its euro zone creditors. Asian shares
hit 15-month highs on Tuesday, while the dollar and US bond yields were on the
back foot on the prospect of a less-hawkish Federal Reserve policy trajectory. Back
home, finally the BSE Sensex decreased
33.29 points or 0.11% to 29,485.45, while the CNX Nifty was down by 5.35 points
or 0.06% to 9,121.50.
The US markets closed lower on Tuesday,
as the Dow and the Nasdaq logged their worst daily drops since September, while
the S&P 500 also tumbled the most in a single session in five months.
Investors were worried that President Donald Trump will struggle to deliver
promised tax cuts that propelled the market to record highs in recent months,
with nervousness deepening ahead of a key healthcare vote. Despite the recent
move lower, equities have been in a pronounced uptrend for months, up more than
10% since the US election. Investors are betting that the policies Trump is
expected to pursue, including on taxes and regulation, will accelerate economic
growth and boost corporate profits. On the economy front, the US
current-account deficit, a measure of the nation's debt to other countries,
fell 3.1% to $112.4 billion in the final quarter of 2016. The drop in the
current-account deficit in the fourth quarter was tied to a surprisingly large
increase in primary income - returns on American-owned assets held abroad. That
offset a larger trade deficit in goods. The Dow Jones Industrial Average lost
237.85 points or 1.14 percent to 20,668.01, the Nasdaq was down 107.7 points or
1.82 percent to 5,793.83, while S&P 500 dropped 29.45 points or 1.24
percent to 2,344.02.
Crude oil futures resumed their
decline on Tuesday, just a day after showing some recovery. Traders were
concerned with expectations of brimming U.S. oil stockpiles, ahead of a report
on U.S. inventories from the Energy Information Administration (EIA) due to be
released on Wednesday. Investors feared that the next batch of inventories data
would reveal a rise in U.S. crude stockpiles and disregarded a report suggesting
that OPEC oil producers increasingly favor extending its deal to cut oil
production beyond June. Benchmark crude oil futures for May delivery declined by
$0.88 to $47.34 on the New York Mercantile Exchange. In London, Brent crude for
May delivery ended down by $0.60 at $51.02 on the ICE.
Extending
its gains for the second straight session, Indian rupee strengthened against
dollar on Tuesday due to sustained selling of the US currency by exporters and
banks. Traders took some support with report that Cabinet cleared four supporting
GST legislations, paving the way for their introduction in Parliament. Once
approved by Parliament, the states would start taking their SGST bill for
discussion and passage in the respective state assemblies. Though, weak trade
in the local equity market capped some gains. On the global front, dollar
slipped against yen after Chicago Federal Reserve President Charles Evans
reinforced the perception that the US central bank won't accelerate the pace of
its interest rate hikes. Finally, the rupee ended at 65.28, 8 paise stronger
from its previous close of 65.36 on Monday.
The
FIIs as per Tuesday's data were net buyers in equity and debt segments both. In
equity segment, the gross buying was of Rs 5482.03 crore against gross selling
of Rs 4863.12 crore, while in the debt segment, the gross purchase was of Rs
2477.70 crore with gross sales of Rs 1221.79 crore.
The US markets suffered sharp
slump in the last session on uncertainty about the fate of the Republican plan
to repeal and replace Obamacare ahead of an anticipated vote on Thursday. The
Asian markets following the US counterparts have made a weak start and some of
the indices in the region are down by over a percent in early deals, concern
continued amid uncertainty over prospects for the U.S. president's policies. The
Indian markets fell further in last session, though the decline was modest with
some sign of recovery in the final hours. Today, the start is likely to be in
red on feeble global cues. There will be some cautiousness with government
continuing the clampdown on cash transactions, proposing to further tighten
payment norms by capping cash transactions at Rs 2 lakh. Finance Minister in
all has moved 40 amendments to the Finance Bill 2017. Meanwhile, the government
has said it is not possible to pinpoint the impact of demonetisation on GDP as
economic growth is contingent on a number of factors. However, as per the
second advance estimates released by the Central Statistics Office on February
28, based mostly on information for the first nine to ten months of 2016-17,
the growth rate of gross domestic product (GDP) at constant market prices is
estimated to be 7.1 per cent in 2016-17. The traders will also be eyeing the
rupee movement in today's trade, which gained further ground against dollar and
reached its 17 months high and may weigh down the IT and technology stocks.
There will be some buzz in the infra stocks on reports that NITI Aayog will
prepare a list of 10 big infrastructure projects that can be developed under
the public private partnership (PPP) mode. The list would be prepared after
taking into consideration the details of such big projects that would be
provided by the states in the coming weeks.
Support and Resistance: NSE (Nifty) and BSE
(Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
9121.50
|
9089.88
|
9150.43
|
BSE Sensex
|
29485.45
|
29382.04
|
29586.95
|
Nifty Top volumes
Stock
|
Volume
(in Lacs)
|
Previous close (Rs)
|
Support
(Rs)
|
Resistance (Rs)
|
IDEA
|
886.01
|
92.95
|
89.35
|
97.30
|
ICICI Bank
|
148.22
|
272.05
|
269.83
|
275.53
|
ITC
|
132.25
|
287.90
|
284.40
|
290.00
|
SBI
|
118.98
|
272.35
|
269.32
|
276.22
|
Axis Bank
|
110.18
|
488.30
|
482.90
|
496.85
|
HCL Technologies has been chosen as the strategic IT services provider to the Volvo Ocean Race.
ICICI Bank has launched mobile banking app for rural customers that allow them to access banking services as well as information on agri services.
IndusInd Bank has inaugurated a new branch in Faridabad, which is a major industrial hub in the state of Haryana.
Aurobindo Pharma has received final approval from the USFDA to manufacture Guaifenesin and Dextromethorphan Hydrobromide extended-release tablets, 600/30 mg and 1200/60mg.