Fluctuating between losses and
gains, Indian equity benchmarks ended the day largely flat on Friday, on the
back of weak global cues amid ongoing coronavirus spread. Markets made a
cautious start and struggled for direction throughout the day, as sentiments
got hurt with ratings agency Crisil's report that the Indian economy will
contract by 9 per cent in 2020-21 as the coronavirus infections are yet to peak
and the government is not providing adequate direct fiscal support. Some
concern also came with rating agency ICRA's report that asset reconstruction
companies (ARCs) are facing slowdown in recoveries from bad loans procured from
banks due to failed auctions, absence of bidders and delay in payments amid
COVID-19 pandemic. Trading sentiments remained in lackluster mood with CARE
Ratings' report that reflecting the overall stress in the economy, the
employment growth rate declined to 3.5 percent in FY20 as compared to 3.8
percent in the previous fiscal year, but the total number of jobs increased to
50.02 lakh from 48.32 lakh. Adding more pessimism, the International Monetary
Fund (IMF) has said the impact of COVID-19 pandemic is significant on India's
development and the immediate priority is a coordinated policy response.
However, markets managed close session with minor gains, as traders found some
solace with report that India and China have agreed on a five-point plan for
resolving the prolonged border face-off in eastern Ladakh that included abiding
by all existing agreements and protocol on management of the frontier,
maintaining peace and tranquility and avoiding any action that could escalate
matters. Finally, the BSE Sensex rose 14.23 points or 0.04% to 38,854.55, while
the CNX Nifty was up by 15.20 points or 0.13% to 11,464.45.
The US markets ended choppy
trading session mostly higher on Friday as traders seemed reluctant to make
significant moves following the substantial volatility seen over the past
several sessions. Buying interest waned over the course of the session, leading
to another tech sector-led drop by the broader markets. In spite of the
lackluster performance by the broader markets, steel stocks showed a
significant move to the upside. Considerable strength was also visible among
housing stocks. Chemical, banking and computer hardware stocks also saw notable
strength. Traders also looking ahead to the Federal Reserve's latest monetary
policy decision scheduled for next Wednesday. The Fed is widely expected to
leave rates at near-zero levels but could make tweaks to its accompanying
statement. The central bank's latest economic projections may also attract some
attention. On the economic front, the Labor Department released a report
showing consumer prices increased by slightly more than anticipated in the
month of August. The Labor Department said its consumer price index climbed by
0.4 percent in August after advancing by 0.6 percent for two straight months.
Street had expected consumer prices to rise by 0.3 percent. Excluding food and
energy prices, core consumer prices still rose by 0.4 percent in August
following a 0.6 percent increase in July. Core consumer prices were expected to
edge up by 0.2 percent.
Crude oil futures ended sluggish
trading session slightly in green on Friday. Worries over the outlook for
energy demand due to a continued surge in coronavirus cases and data showing
higher crude inventories weighed on the commodity and limited its upside. US
crude inventories increased by about 2 million barrels last week compared to
expectations for a drop of 1.3 million barrels. As per a private report, US
gasoline demand fell nearly 2% in the last week of August compared to a week
earlier. According to Baker Hughes, weekly active oil-rig count in the US has
dropped by 1 to 180 this week. Total weekly drilling-ring count has come down
by 2 to 254. Crude oil futures for October rose 3 cents or 0.08 percent to
settle at $37.33 a barrel on the New York Mercantile Exchange. However,
November Brent crude declined 23 cents or 0.6 percent to settle at $39.83 a
barrel on London's Intercontinental Exchange.
Indian rupee ended lower against
dollar on Friday, on account of sustained dollar demand from importers and
banks. Sentiments remained impacted as Ratings agency Crisil in its latest
report has sharply lowered its forecast for India's gross domestic product
(GDP) growth for the current fiscal 2020-21 (FY21) to (-) 9 percent as against
its earlier estimate of (-) 5 percent projected in May, as the coronavirus
infections are yet to peak and the government is not providing adequate direct
fiscal support. Traders took note of report that India-US limited trade deal
may be signed after elections there, Commerce and Industry Minister Piyush
Goyal said India has given America a very good, very balanced offer for the
agreement. On the global front; pound rose against the dollar on Friday,
bobbing above the $1.28 mark after a week in which new Brexit friction between
Britain and the European Union put the currency on track for its worst week
since March's coronavirus-led market selloff. Finally, the rupee ended at
73.53, 7 paise weaker from its previous close of 73.46 on Thursday.
The FIIs as per Thursday's data
were net buyer in equity and debt segment. In equity segment, the gross buying
was of Rs 5896.20 crore against gross selling of Rs 4976.04 crore, while in the
debt segment, the gross purchase was of Rs 197.18 crore with gross sales of Rs
180.27 crore. Besides, in the hybrid segment, the gross buying was of Rs 10.47
crore against gross selling of Rs 21.07 crore.
The US markets ended mostly
higher on Friday as traders seemed reluctant to make significant moves
following the substantial volatility seen over the past several sessions. Asian
markets are trading mostly higher on Monday with investors watching shares of
Japanese conglomerate Softbank Group following an announcement of its sale of
U.K. chip designer Arm. Indian markets ended flat on Friday as gains from IT
and auto stocks were capped by banking and financial services sector. Today,
the markets are likely to make positive start following global peers. Investors
will be eyeing CPI and WPI inflation data which are scheduled to be release
later in the day. Traders will be taking encouragement as Chief Economic
Adviser K V Subramanian exuded confidence that retail inflation will come down
in the days ahead with the easing of lockdowns, attributing the rise in
inflation to supply-side frictions. Some support will come as the finance
ministry said banks have sanctioned loans worth over Rs 1.63 lakh crore to more
than 42 lakh business units under the Rs 3-lakh crore Emergency Credit Line
Guarantee Scheme (ECLGS) for the MSME sector. Also, RBI data showed that the
country's foreign exchange reserves rose by $582 million to reach a lifetime
high of $542.013 billion in the week ended September 4. However, there may some
cautiousness as India's industrial output contracted 10.4 percent in July as
against a 4.9 percent growth year-on-year (YoY). traders may be concerned as
rating agency Moody's projected India's real gross domestic product (GDP) to
contract by 11.5 percent in FY21. Also, domestic rating agency CARE Ratings
said the country's economy is likely to see a sharper contraction of 8-8.2
percent in the current financial year compared to a decline of 6.4 per cent it
had projected earlier. Meanwhile, with over 93,215 new cases, India's
coronavirus tally has reached 4,845,003. The death toll has risen by 1,140 to
79,754. DTH companies stocks will be in focus with Crisil's report that people
staying indoors due to the COVID-19 pandemic has proved to be a bonanza for
direct-to-home (DTH) broadcasters as the industry is all set to post a growth
of up to 6 per cent in its topline to Rs 22,000 crore in FY21. There will be
some reaction in coal industry stocks as India's coal import declined by 34.9
percent to 12.46 million tonnes (MT) in August on account of subdued demand for
the dry fuel from consuming sectors like power and cement.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,464.45
|
11,425.06
|
11,498.66
|
BSE Sensex
|
38,854.55
|
38,718.06
|
38,984.78
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Motors
|
651.38
|
144.30
|
141.70
|
146.85
|
State Bank of India
|
484.88
|
202.70
|
198.51
|
205.36
|
Wipro
|
419.37
|
293.30
|
284.39
|
300.34
|
Reliance Industries
|
274.46
|
2,319.75
|
2,291.95
|
2,342.70
|
Zee Entertainment
Enterprises
|
272.01
|
218.10
|
214.61
|
223.16
|
Infosys is planning to hire 500 additional tech workers in Rhode Island, US by 2023.
Coal India is planning to restore production from its discontinued underground mines.
ICICI Bank has launched a new offering, iStartup 2.0, for start-ups with improved features.
Bajaj Finance has raised Rs 400 crore through Secured redeemable non-convertibles debentures.