Indian equity bourses witnessed
huge losses on last trading day of the week, with Senses & Nifty ending
lower by over 2%. After weak start, indices remained in red, impacted with
S&P Global Ratings' report that a fast spreading coronavirus outbreak could
knock $211 billion off the combined economies of the Asia-Pacific, with Japan,
Hong Kong, Singapore and Australia among the most exposed. Adding worries over
the street, the Reserve Bank of India superseded the board of Yes Bank and
imposed a 30-day moratorium on it in the absence of a credible revival plan
amid a serious deterioration in its financial health. Weakness persisted during
the whole trading day, after domestic rating agency CRISIL said that the
troubled non-bank lenders' segment is defying caution and growing the riskier
unsecured loans portfolio at a pace of 25 per cent in the current fiscal. It
also said that a rising propensity for personal loans and attractive
risk-adjusted returns are the possible reasons driving the non-banking finance
companies (NBFC) to grow on such loans. Traders overlooked Reserve Bank
governor Shaktikanta Das' assurance that the central bank will take every
measure needed to secure the economy against the challenges arising from the
coronavirus epidemic. Finally, the BSE Sensex lost 893.99 points or 2.32% to
37,576.62, while the CNX Nifty was down by 279.55 points or 2.48% to 10,989.45.
Extending previous session's
losses, the US markets ended lower on Friday, with cut of around a percent
each, as traders continue to worry about the economic impact of the coronavirus
outbreak. Recent data points to a slowdown in new coronavirus infections in
China, but the disease seems to be spreading more rapidly around the rest of
the world. So far, more than 100,000 infections have been confirmed worldwide
and more than 3,300 people have been killed by the virus. The worries about the
outbreak overshadowed the Labor Department's usually closely watched monthly
employment report. The report showed much stronger than expected job growth in
the month of February, although traders view the data as old news as the
coronavirus fears have ramped up only recently. The Labor Department said
employment surged up by 273,000 jobs in February, matching the upwardly revised
spike in January. With the much stronger than expected job growth, the
unemployment rate unexpectedly edged down to 3.5 percent in February from 3.6
percent in January. The rate had been expected to remain unchanged. A separate
report released by the Commerce Department showed the US trade deficit narrowed
more than expected in the month of January, as the value of imports fell by
more than the value of exports. The Commerce Department said the trade deficit
narrowed to $45.3 billion in January from a revised $48.6 billion in December.
Crude oil futures settled to the
lowest level in several years on Friday after the Organization of the Petroleum
Exporting Countries' (OPEC) proposal for deeper output cuts was rejected by its
allies. The meeting between OPEC and its allies concluded with the cartel and
its allies failing to agree on the former's proposal of reducing production by
another 1.5 million barrels per day from April to end of this year. The meeting
concluded with the participants deciding to continue with the existing level of
production cut till the end of this month. The OPEC+ has decided to meet in
early June to review the situation. Also, mounting worries about the economic
impact of the coronavirus outbreak and an imminent drop in energy demand
weighed on oil prices. Meanwhile, Baker Hughes reported that the number of
active US rigs drilling for oil rose by four to 682 this week, after seeing a
decline of one rig in the previous week. Crude oil futures for April slipped
$4.62 or about 10.1 percent to settle at $41.28 a barrel on the New York
Mercantile Exchange. May Brent crude lost $4.72 or 9.4 percent to settle at
$45.27 a barrel on London's Intercontinental Exchange.
Indian
rupee fell sharply against US dollar on Friday, on increased demand for the US
currency from importers. Traders remained cautious with S&P Global Ratings'
report that a fast spreading coronavirus outbreak could knock $211 billion off
the combined economies of the Asia-Pacific, with Japan, Hong Kong, Singapore
and Australia among the most exposed. However, S&P did not cut growth
forecasts for emerging markets of Indonesia, Malaysia, the Philippines and
India, citing the fact that reported infections in those countries were still
low. Across the global sell-off together with weakness in the Indian markets
added to the woes of the Indian currency. However, rupee pared most of its
losses on the back of easing crude oil prices and weakness in the dollar
vis-a-vis other key global currencies. On the global front, Sterling extended
gains against a broadly weaker dollar on Friday, and was also boosted by
comments from the European Union's Brexit chief negotiator that a trade deal
between Britain and the bloc was still possible this year. The last traded
price of rupee was 73.79, 46 paise weaker from its previous close of 73.33 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 6059.16 crore against gross
selling of Rs 8296.84 crore, while in the debt segment, the gross purchase was
of Rs 1855.90 crore with gross sales of Rs 1548.82 crore. Besides, in the
hybrid segment, the gross buying was of Rs 26.25 crore against gross selling of
Rs 12.58 crore.
The US markets ended in red on
Friday as the coronavirus outbreak kept investors on edge. Asian markets are
trading lower in early deals on Monday as panicked investors fled to bonds to
hedge the economic shock of the coronavirus. Indian markets ended sharply lower
on Friday amid selling across the board as a spreading coronavirus stoked fears
of a prolonged economic slowdown. Today, the start of new week is likely to be
gap-down following sell-off in the global markets amid coronavirus fears.
Traders will be concerned with credit rating agency Moody's statement that the
coronavirus has increased the risk of a global recession this year. It added that
advanced economies including the United States, Japan, Germany, Italy, France,
Britain and Korea could all fall into recession in an adverse scenario. Some
cautiousness will come with report that snapping their six-month buying streak,
FPIs pulled out a net Rs 13,157 crore from the Indian capital markets in the
first five trading sessions of March as the coronavirus outbreak spooked
investor sentiment. However, some respite may come later in the day as oil
prices plunged nearly 21% in early trade on Monday after Saudi Arabia slashed
its official selling price. Some encouragement may also come with the latest
Reserve Bank of India's (RBI) data showing that the country's foreign exchange
reserves swelled by $5.42 billion to a lifetime high of $481.54 billion in the
week to February 14, on the back of rise in foreign currency assets. In the
previous week, the foreign exchange reserves had increased by $29 million to
$476.12 billion. Also, some support may come with report that investments
through participatory notes (P-notes) in the domestic capital market rose
marginally to Rs 67,281 crore at the end of January 2020. Investments increased
after hitting a nearly 11-year low at the end of December 2019 when the total
value of P-note investments in Indian markets -- equity, debt, and derivatives
-- stood at Rs 64,537 crore. Traders may take note of NITI Aayog CEO Amitabh
Kant's statement that technology in sunrise sectors will have to be the key for
the country to achieve 9-10 per cent growth. There will be some buzz in the
banking stocks as allaying concerns over banking sector health in the wake of
Yes Bank fiasco, Chief Economic Adviser Krishnamurthy Subramanian said Indian
banks are well capitalised and there is no reason to worry. He further said
that it is a wrong method to assess a lender's health based on the ratio of
deposit to m-cap (market capitalisation). There will be some reaction in IT
stocks with former NASSCOM President R Chandrashekar's statement that India's
information technology (IT) services sector is facing adverse impact on the
operational front following the outbreak of coronovirus in several countries.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,989.45
|
10,866.20
|
11,073.90
|
BSE Sensex
|
37,576.62
|
37,142.78
|
37,878.76
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
State Bank of India
|
1,060.43
|
270.50
|
258.17
|
278.62
|
Tata Motors
|
839.71
|
114.20
|
112.23
|
116.73
|
ICICI Bank
|
310.24
|
486.35
|
476.83
|
496.33
|
ITC
|
267.65
|
181.75
|
179.38
|
184.48
|
Indian Oil Corporation
|
246.84
|
100.80
|
99.47
|
101.97
|
USFDA has completed audit at Dr. Reddy's Laboratories' API Manufacturing Plant-5 at Miryalaguda, Nalgonda District, Telangana.
NTPC is planning to set up two new units of 600 MW each at Talcher Thermal Power Station in Odisha with an investment of Rs 7,400 crore.
TCS has received an approval from the government to set up special economic zone for IT sector in Noida, Uttar Pradesh, on 19.9 hectares land.
Maruti Suzuki India has reported 5.39 percent fall in its production in February 2020.