Indian equity bourses receded
from fresh record highs to close marginally higher on Thursday. The start of
the day was fabulous, aided by Economist Intelligence Unit's report that India
& China are projected to see accelerated economic growth in the fourth
quarter of this year, bucking trends in the US & the European Union. It
added that the real GDP growth of India in the December-ending quarter is
expected to be the highest among G7 & BRICS nations. Traders also got
comfort with a private report that Indian companies have ranked third in Asia's
overall environmental sustainability out of eight markets studied, with an
average score of 63.12, which is slightly exceeded the regional average of
62.34 points. In the last leg of the trading session, markets cut most of their
gains, after credit rating agency, India Ratings and Research's (Ind-Ra)
analysis of data of Annual Survey of Industries (ASI) indicated slowdown in
labour productivity growth in the Indian organized manufacturing sector, which
grew at an average annual rate of 3.7% during FY16-FY18 (FY11-FY15: 7.4%,
FY06-FY10: 10.3%, FY01-FY05: 9.6%), however, it fell to 2.6% and 2.9% in FY17
and FY18, respectively. But, key indices managed to settle above their
respective neutral lines, as Commerce and Industry Minister Piyush Goyal assured
that start-ups will never be harassed and that the government is taking steps
to promote them. Finally, the BSE Sensex gained 77.18 points or 0.19% to
40,129.05, while the CNX Nifty was up by 33.35 points or 0.28% to 11,877.45.
The US markets settled in red
territory on Thursday amid renewed uncertainty about the potential for a
long-term US-China trade deal. Optimism about phase one of a trade deal
contributed to recent strength on Wall Street, but a new report stated that
Chinese officials are casting doubts about reaching a comprehensive long-term
trade agreement. As per a report, Chinese officials have warned in private
conversations that they are unwilling to budge on the thorniest issues. Trump
and Chinese President Xi Jinping had been due to meet and potentially sign the
deal at the APEC summit in Chile, but the Chilean President recently called off
the summit due to unrest in the country. However, upbeat earnings capped the
losses in markets, with Apple (AAPL) and Facebook (FB) posting notable gains
after reporting better than expected quarterly results. On the US economic
front, the Labor Department released a report showing a modest increase in first-time
claims for US unemployment benefits in the week ended October 26. The report
said initial jobless claims rose to 218,000, an increase of 5,000 from the
previous week's revised level of 213,000. Street had expected jobless claims to
inch up to 215,000 from the 212,000 originally reported for the previous week.
A separate report from the Commerce Department showed personal income and
spending both increased in line with market participants estimates in the month
of September. The report said personal income increased by 0.3 percent in
September after climbing by an upwardly revised 0.5 percent in August.
Meanwhile, the Commerce Department said personal spending edged up by 0.2
percent, matching the revised uptick seen in August.
Crude oil futures ended sharply
lower on Thursday, amid concerns over outlook for energy demand due to slowing
economies and uncertainty about US-China trade deal. This was fourth successive
session of losses in crude oil prices. Weak data out of China raised concerns
about energy demand outlook. The National Bureau of Statistics showed that
China's service sector logged weaker growth in October. Besides, data released
by the Energy Information Administration on Wednesday showed US crude
stockpiles rose by 5.7 million barrels in the week ended October 25. That was
more than twice the expected jump. Benchmark crude oil futures for December
declined 88 cents or 1.6 percent to settle at $54.18 a barrel on the New York
Mercantile Exchange. December Brent lost 38 cents or 0.6 percent to settle at
$60.23 a barrel on London's Intercontinental Exchange.
Erasing
all of its initial gains, Indian rupee ended almost flat against dollar on
Thursday, as rising crude oil prices kept investors edgy. Traders failed to
take support with the Economist Intelligence Unit's report stating that India
and China are projected to see accelerated economic growth in the fourth
quarter of this year, bucking trends in the US and the European Union. It added
that the real GDP growth of India in the December-ending quarter is expected to
be the highest among G7 and BRICS nations. In the third quarter, India's real
GDP growth is estimated to be 1% on a quarter-on-quarter basis and is projected
to rise to 2.20% in the fourth quarter. On the global front, euro gained on
Thursday as the dollar weakened after the Federal Reserve cut interest rates
for the third time this year and left open the question of whether it would cut
them further. Finally, the rupee ended at 70.92, 2 paise weaker from its
previous close of 70.90 on Wednesday.
The
FIIs as per Thursday's data were net buyers in both equity and debt segments.
In equity segment, the gross buying was of Rs 12744.79 crore against gross
selling of Rs 5150.28 crore, while in the debt segment, the gross purchase was
of Rs 3353.32 crore with gross sales of Rs 2875.14 crore. Besides, in the
hybrid segment, the gross buying was of Rs 13.98 crore against gross selling of
Rs 8.17 crore.
The US markets ended lower on
Thursday on skepticism about a US-China trade truce and weakening manufacturing
data. Asian markets are trading mostly in red on Friday on fresh concerns over
Sino-US trade prospects. Indian markets hit a fresh record high intraday and
ended with marginal gains on Thursday on positive global cues, as well as,
positive sentiment on D-Street. Today, the markets are likely to make
flat-to-negative start amid weakness in global markets. Traders will be
concerned with the government data showing that output of core infrastructure
industries shrank by 5.2% in September 2019 as seven of eight sectors witnessed
negative growth. The eight core sectors had expanded by 4.3% in September 2018.
During the April-September period, the growth of core industries fell to 1.3%
against 5.5% in the year-ago period. There will be some cautiousness with
report that India's fiscal deficit has widened in the first half of the current
fiscal year. The fiscal deficit stood at Rs 6.52 lakh crore till September-end
2019, compared to Rs 5.95 lakh crore in the same period of the previous fiscal
year. Low revenue collections have become a reason to worry about the fiscal
deficit. Traders may take note of former Reserve Bank of India (RBI) governor
Raghuram Rajan's statement that India needs new generation of reforms for
economic growth. He also talked about the need for cleaning up the banking
system. Meanwhile, putting in place a stricter framework, Sebi has directed all
listed banks to disclose any divergence in bad loan provisioning within 24
hours of receiving RBI's risk assessment report, rather than waiting to publish
the details in their annual financial statements. There will be some reaction
in Non-banking financial companies (NBFCs) stocks as the finance ministry said
public sector banks (PSBs) have extended support of Rs 2.56 lakh crore to NBFCs
by way of credit and pooled buyout since September 2018 as part of efforts to
provide much-needed liquidity to the sector. There will be some buzz in the
infrastructure stocks with Icra's report that waiver of earnest money deposit
for highway projects in EPC mode comes as a relief for mid-sized highway
players. The auto sector stocks will also be in action, reacting to their
monthly sales numbers. There will be lots of earnings announcements too, to
keep the markets in action.
Support and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous
close
|
Support
|
Resistance
|
NSE Nifty
|
11,877.45
|
11,840.03
|
11,929.93
|
BSE Sensex
|
40,129.05
|
39,991.89
|
40,329.22
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
8,369.67
|
70.40
|
57.30
|
81.10
|
SBI
|
1,284.49
|
312.40
|
297.50
|
322.55
|
Tata Motors
|
813.93
|
177.70
|
171.22
|
181.92
|
ZEEL
|
288.13
|
260.60
|
242.15
|
271.55
|
Infosys
|
274.06
|
685.60
|
669.32
|
698.67
|
Reliance Industries' subsidiary -- Reliance Brands has increased its equity shareholding in Future101 Design by 2.5% for a consideration of Rs 2 crore, taking its equity shareholding in Future101 to 17.5%.
HDFC Bank has reached an important milestone of 525 branches in the city of Ghaziabad.
Yes Bank has received a binding offer for a $1.2-billion funding from an overseas investor through fresh issuance of equity shares.
IOC has reported a fall of 88.86% in its consolidated net profit at Rs 370.44 crore for Q2FY20 as compared to Rs 3326.64 crore for Q2FY19.