Extending their losing streak for
third straight session, Indian equity benchmarks settled in red terrain on
Tuesday. After a cautious start markets gained momentum and traded in green for
most part of the day with traders taking encouragement with Suresh Prabhu's
statement that the government will soon come out with a comprehensive strategy
to increase the share of global trade to 40 percent of the gross domestic
product (GDP), which is expected to touch $5 trillion by 2025. Some support
also came with NASSCOM, the IT industry body enlightening that the Indian
Information Technology industry expects to grow exports at a marginally higher
7-9 percent in the coming fiscal, slightly higher than its expected growth of
7.8 percent in the current financial year. In June last year, NASSCOM had said
it expects growth of 7-8 percent this fiscal. It expects to add $14-16 billion
in revenue in the coming year. However, sentiments turned pessimistic and sharp
selloff in last leg of trade dragged markets lower. Traders turned cautious
ahead of February Futures & Options (F&O) series to be expired on
Thursday i.e. February 22, 2018. Traders also remained concerned after the
government said the amount of money claimed by exporters as tax refunds under
Goods and Service Tax (GST), from the time the regime came into force in July
2017, till December of that year, is Rs 55 billion. This is a major comedown
from the Rs 65 billion that the Finance Ministry had announced last year as
refunds claimed till October. Exporters continue to assert that thousands of
millions worth of tax refunds are yet to be released by the authorities.
Investors also took note that the GST Council, headed by Finance Minister Arun
Jaitley, is likely to meet next week to decide on ease of compliance in filing
the GST returns. Since the implementation of the GST on July 1, 2017, traders
have been complaining about technical glitches in the GSTN, besides the complex
process. Finally, the BSE Sensex shed 71.07 points or 0.21% to 33,703.59, while
the CNX Nifty was down by 18 points or 0.17% to 10,360.40.
The US market
snapped six-day winning streak on Tuesday, with the Dow and S&P 500 weighed
down by a steep loss for Walmart as investors also watched climbing bond
yields, which could make equities less attractive at current levels. A renewed
push higher for US bond yields - with the dollar also stronger - was being
blamed for the market's weakness. Climbing bond yields - reflecting rising
inflation worries - were the spark that set off the market meltdown earlier
this month. Some of the US government's short-term borrowing costs rose to
their highest level in more than nine years as the government raised $179
billion in the Treasury securities market to fund spending and make debt
payments. Tuesday's auctions made up more than half of the $258 billion in
Treasury debt supply scheduled for sale this week, which is projected to raise
nearly $48 billion in new cash for the government. Wednesday's release of
minutes from the Federal Reserve's January policy meeting, the last chaired by
Janet Yellen, will be combed for clues to the central bank's thinking on
interest rates. The Dow Jones Industrial Average lost 254.63 points or 1.01
percent to 24,964.75, Nasdaq was down by 5.157 points or 0.07 percent to
7,234.31, and S&P 500 dropped 15.96 points or 0.58 percent to 2,716.26.
Crude oil prices edged higher for
fifth straight session on Tuesday amid reports that Saudi Arabia wants $70 oil.
It was previously thought that over $60 oil would compel the Saudis to pump
more oil in an effort to keep prices low. Meanwhile, the Organization of the
Petroleum Exporting Countries (OPEC) and non-OPEC oil producers, including
Russia, will discuss extending their cooperation for many more years when they
meet in June as they seek to avoid major market shocks. Monday's U.S. holiday
for Presidents Day supported U.S. West Texas Intermediate's (WTI) performance
compared with Brent as the U.S. markets caught up with Monday's gains. Benchmark
crude oil futures for March delivery surged 24 cents at $61.94 a barrel on the
New York Mercantile Exchange. However, April Brent crude lost 42 cents or 0.06
percent to settle at $65.25 a barrel on London's Intercontinental Exchange.
Stretching
slide for the second straight session, Indian rupee depreciated to near
three-month low against dollar on Tuesday, on increased selling of the US
currency by exporters and banks. The domestic currency made a weak start and
remained under pressure throughout the day due to the dollar strength against
other currencies overseas. Traders also remained concerned after the government
said the amount of money claimed by exporters as tax refunds under Goods and
Service Tax (GST), from the time the regime came into force in July 2017, till
December of that year, is Rs 55 billion. This is a major comedown from the Rs
65 billion that the Finance Ministry had announced last year as refunds claimed
till October. Exporters continue to assert that thousands of millions worth of
tax refunds are yet to be released by the authorities. Besides, selling in late
hour of trade in the domestic equity markets, added some extra pressure on the
rupee. On the global front, dollar continued its rebound from three-year lows
on Tuesday, having recovered 1.5 percent since Friday on the view that the US
currency was due a correction after a brutal sell-off in recent weeks. Finally,
the rupee ended at 64.79, 58 paise weaker from its previous close of 64.21 on
Friday.
The FIIs as per Tuesday's data
were net buyers in equity segment, while they were net sellers in debt segment,
in equity segment, the gross buying was of Rs 9845.98 crore against gross
selling of Rs 8688.69 crore, in the debt segment, the gross purchase was of Rs
172.59 crore with gross sales of Rs 675.14 crore. Besides, in the hybrid
segment, the gross buying was of Rs 1.24 crore against gross selling of Rs 1.83
crore.
The US markets ended lower on
Tuesday as traders digested recent volatility and expressed some uncertainty
about the near-term outlook for the markets. Traders also remained reluctant to
make more significant moves amid a quiet day on the U.S. economic front. Asian
markets were trading mostly in green despite the softer lead stateside, with
more convincing gains seen in Taiwan. The Japanese stock market recovered after
a weak start and is modestly higher on Wednesday, with a weaker yen lifting
exporters' shares. Indian equity markets succumbed to selling pressure for the
third day running on Tuesday as worries intensified about fallout from a $1.77
billion fraud at Punjab National Bank and investors waited for the minutes of
the latest Federal Reserve meeting for clues on the U.S. rate outlook. Today,
markets is likely to make flat-to-positive start, as traders may go for bargain
hunting after three successive days of losses. However, renewed selling by
foreign investors on worries over the Rs 11,300 crore fraud case at Punjab
National Bank (PNB), concerns over the government's fiscal position and chances
of another interest rate hike from the Federal Reserve in March may keep
underlying sentiment cautious. Traders will get some solace with report that
the Reserve Bank of India (RBI) has set up a five-member expert panel to look
into the reasons for high divergence observed in asset classification and
provisioning by banks. Meanwhile, Finance minister Arun Jaitley has come down
heavily on public sector banks for not safeguarding taxpayers' money spent to
keep them afloat. He warned that the government would explore all options to
punish the cheats responsible for bank frauds. There will be buzz in software
related stocks on report that India's software services sector will see revenue
growth of 7-9 percent in constant currency terms in the fiscal year to March
2019. The forecast, which was put out at the annual summit of the National
Association of Software and Services Companies (NASSCOM), is in line with the 7.8
percent revenue growth it expects in the six months to the end of March 2018.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,360.40
|
10,328.92
|
10,410.62
|
BSE Sensex
|
33,703.59
|
33,587.34
|
33,890.40
|
Nifty Top volumes
Stock
|
Volume
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
SBI
|
334.58
|
269.65
|
264.90
|
274.30
|
ICICI Bank
|
160.31
|
317.25
|
314.30
|
322.20
|
Vedanta
|
113.95
|
328.70
|
322.13
|
333.13
|
Yes Bank
|
113.89
|
308.70
|
305.43
|
314.03
|
Tata Steel
|
102.14
|
651.30
|
645.80
|
659.15
|
M&M is planning to make an additional investment at its Chakan plant in Maharashtra.
Tata Motors has inaugurated its 22nd commercial vehicle dealership on February 16, 2018 in the state of Maharashtra through Ujwal Automotives in Nashik.
Indian Oil Corporation has entered into partnership with payments platform, PhonePe.
Sun Pharmaceutical Industries' one of the wholly owned subsidiaries has increased its shareholding in Ranbaxy Malaysia.