Indian equity benchmarks
witnessed a bloodbath on Monday's trading session by falling over a percent.
After a weak start, markets remained under a grip of bears for the whole day,
amid a private report indicating that the country's fiscal deficit for 2019-20
is expected to widen to 3.8% and the upcoming Budget may set a target of 3.5%
for 2020-21. Some concerns also came with a report stating that India plans to
increase import duties on more than 50 items including electronics, electrical
goods, chemicals and handicrafts, targeting about $56 billion worth of imports
from China and elsewhere. In the last leg of the trade, losses got extended on
the streets, as Nobel laureate and economist Abhijit Banerjee said that the
banking sector in the country is stressed and the government is in no position
to bail it out. He said the demand slowdown in the automobile sector also shows
that people are lacking confidence in the economy. Market participants paid no
heed towards the Reserve bank of India (RBI) Governor Shaktikanta Das'
statement that structural reforms and fiscal measures may have to be continued
and further activated to provide a durable push to demand and boost growth.
Finally, the BSE Sensex slipped 458.07 points or 1.10% to 41,155.12, while the
CNX Nifty was down by 129.25 points or 1.06% to 12,119.00.
Extending the notable pullback
seen over the course of the previous session, the US markets ended lower with
cut of over one and half percent on Monday, amid growing worries about the
economic implications of a rising death tolls and growing infections from a
fast-moving virus in China. The coronavirus injected markets investors with
fresh worries after China extended this week's Lunar New Year holiday and took more
drastic measures to halt the spread of the illness. As of Monday, the death
count rose to more than 80, and the number of those infected neared 3,000
confirmed cases. In the US, at least 110 people were identified as under
investigation for the virus, according to the Centers for Disease Control and
Prevention, while a handful of infections were reported in other countries,
such as France and Japan. The continued spread of the coronavirus weighed on
travel, tourism and hospitality stocks as well as companies with major exposure
to China. On the economic data front, new home sales unexpectedly showed a
modest decrease in the month of December, according to a report released by the
Commerce Department. The report said new home sales fell by 0.4 percent to an
annual rate of 694,000 in December from a downwardly revised 697,000 in
November. Revised data also showed new home sales slumped by 1.1 percent in
November compared to the previously reported 1.3 percent jump. The unexpected
decrease was largely due to a steep drop in new home sales in the South, which
plunged by 15.4 percent to a rate of 347,000.
Magnifying losses to a fifth
straight session, crude oil futures ended lower on Monday as the growing death
toll and spread of China's deadly influenza over the weekend incited fresh
fears that the illness could hurt global energy demand. The virus is fuelling
fears of a cooling of oil demand, which would mean that the global oil market
would be oversupplied to an even greater extent if no further measures are
taken to reduce supply. As of Monday, the death count rose to 80 and the number
of infected neared 3,000 confirmed cases. In the US, there are now five
confirmed cases, with a handful of infections in other countries, such as
France and Japan. Besides, oil prices fell despite Saudi Arabia saying it
believes the crisis so far will have a very limited impact on consumption.
Saudi Arabia's Energy Minister Prince Abdulaziz bin Salman Al-Saud said the
kingdom was closely monitoring developments in global oil markets resulting
from gloomy expectations over the impact of the new coronavirus on the Chinese
and global economy and oil market fundamentals. Crude oil futures for March
fell $1.05 or 1.9 percent to settle at $53.14 a barrel on the New York
Mercantile Exchange. March Brent dropped $1.37 or 2.3 percent to settle at
$59.32 a barrel on London's Intercontinental Exchange.
Indian
rupee continued to slip for the third consecutive session against the US dollar
on Monday, following buying in the American currency by banks and importers.
Traders remain worried with a private report indicating that the country's fiscal
deficit for 2019-20 is expected to widen to 3.8% and the upcoming Budget may
set a target of 3.5% for 2020-21. Traders also reacted negatively to private
report that India's corporate and income tax collection for the current year is
likely to fall for the first time in at least two decades, amid a sharp fall in
economic growth and cut in corporate tax rates. The domestic currency was also
weighed down by dollar's strengthen against some other currencies overseas
along with sharp losses in the local equities. On the global front, euro fell
on Monday as growing concerns over the potential economic damage from a
fast-spreading coronavirus sapped demand for riskier assets. Finally, the rupee
ended at 71.44, 10 paise weaker from its previous close of 71.33 on Friday.
The
FIIs as per Monday's data were net buyers in both equity and debt segments. In
equity segment, the gross buying was of Rs 4750.17 crore against gross selling
of Rs 4154.75 crore, while in the debt segment, the gross purchase was of Rs
1458.44 crore with gross sales of Rs 651.15 crore. Besides, in the hybrid
segment, the gross buying was of Rs 0.99 crore against gross selling of Rs 4.84
crore.
The US markets ended sharply
lower on Monday as investors grappled with fresh worries about the spread of a
new virus in China that threatens global economic growth. Asian markets are
trading mostly in red on Tuesday as China took more drastic steps to combat the
coronavirus. Indian markets ended considerably lower on Monday, with cut of
over a percent each, following Asian peers, amid decline in banking and metal stocks.
Today, the start of session is likely to be negative following a global selloff
as investors remain concerned over coronavirus spreading across the world.
There will be some cautiousness as a SEBI-appointed panel proposed sweeping
changes to strengthen the monitoring and enforcement of norms pertaining to
related party transactions. However, some support may come later in the day as
the government is planning to raise at least Rs 10,000 crore through the
seventh tranche of CPSE ETF which will open for anchor investors on Thursday.
Besides, Commerce and industry Minister Piyush Goyal has suggested the
Brazilian side to reconstitute and activate India-Brazil Business Leaders Forum
to boost economic ties between the two countries. Meanwhile, India pressed its
largest LNG supplier Qatar to lower the price of gas under the existing
long-term supply contracts, a request that Doha turned down saying sanctity of
contracts is important for the credibility of both sides. Logistic stocks will
be in focus with report that the government may consider announcement of
national logistics policy to promote seamless movement of goods across the
country in the forthcoming Budget. There will be some reaction in banking
stocks with the Reserve Bank of India's (RBI) data showing that urban
cooperative banks (UCBs) have reported nearly 1,000 cases of fraud worth more
than Rs 220 crore in the last five fiscals. The central bank said a total of
181 fraud cases involving Rs 127.7 crore were noticed during 2018-19. There
will be lots of earnings reaction, especially in banking sector, to keep the
markets buzzing.
Support and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
12,119.00
|
12,078.47
|
12,188.07
|
BSE Sensex
|
41,155.12
|
41,012.98
|
41,406.77
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
1,342.42
|
42.40
|
41.68
|
43.28
|
ICICI Bank
|
381.49
|
537.25
|
530.83
|
544.33
|
Tata Motors
|
301.32
|
182.20
|
179.73
|
185.78
|
SBI
|
233.09
|
316.20
|
314.00
|
320.20
|
JSW Steel
|
171.52
|
262.80
|
258.77
|
266.37
|
Maruti Suzuki India has launched Ciaz S, sports variant of country's best-selling premium mid-size sedan Ciaz.
Tata Motors is aiming to establish itself as the leader in the EV market in the country as it looks to roll out new products for both private and fleet segments.
USFDA has concluded a cGMP inspection at Cipla's API manufacturing facility in Bommasandra, Bangalore from January 20 - 24, 2020.
Vedanta is planning to offer Rated, Secured, Redeemable, Non-Cumulative, NCDs aggregating up to Rs 3,000 crore in one or more tranches.