Indian equity benchmarks managed
to close higher after witnessing wild swings during the session on Wednesday,
owing to buying interest in Realty, Telecom and Metal shares. The benchmarks
staged a gap up opening, as traders took encouragement with the Commerce and
Industry Ministry's statement that foreign direct investment (FDI) in India has
increased by 16 per cent year-on-year to $27.1 billion during April-August this
year. During April-August last year, India had received FDI worth $23.35
billion. Additional support came with Ratings agency ICRA's report that India's
economic recovery has broadened and strengthened in September 2020 from the
pandemic-induced lows seen in April 2020. It said that as many as nine of the
tracked 15 non-financial high frequency indicators recorded growth in September
2020, while five posted a narrower year-on-year (YoY) contraction in that
month. However, domestic bourses wiped out entire gains in late afternoon deals,
as RBI analysis showing that aggregate sales of private sector manufacturing
companies recorded a sharp contraction of 41.1 per cent year-on-year in the
first quarter of 2020-21, reflecting the impact of the pandemic induced
lockdown. Some concern also came with reports that even as brands are betting
big on Diwali to light up their sales, a survey has shown below-average
spending propensity among urban Indians this festive season with nearly 50 per
cent respondents agreeing of being careful about their finances. But, the
benchmarks managed to bounce from intraday lows in the last 30 minutes of
trade, taking support from the Retirement fund body, Employees' Provident Fund
Organisation (EPFO) in its latest Provisional Estimate of Net Payroll data
report has showed that India created 1005852 new jobs in the month of August
2020 as against revised figure of 748784 in July 2020. Finally, the BSE Sensex
rose 162.94 points or 0.40% to 40,707.31, while the CNX Nifty was up by 40.85
points or 0.34% to 11,937.65.
The US markets end in red on
Wednesday amid a failure to produce any fresh developments on the negotiations
to carve out additional fiscal support for American workers and businesses.
Private report said that White House officials and House Speaker Nancy Pelosi
opened the door to passing a coronavirus relief package after the election,
indicating that a long-sought-after catalyst for further gains for equities in
2020, ahead of the 2020 presidential elections in November, may be gone for
now. Meanwhile, the rising cases of COVID-19 in the U.S. and Europe, in
particular, have led to the potential for more economic shutdowns, which
impeded investors' sentiments. However, downside remained capped as Economic
activity continued to increase across all Federal Reserve districts, according
to the central bank's Beige Book report released. The Beige Book, a compilation
of anecdotal evidence on economic conditions in the twelve Fed districts, noted
the pace of economic growth characterized as slight to modest in most
districts. The report said manufacturing activity generally increased at a
moderate pace, while residential housing markets continued to experience steady
demand for new and existing homes. Banking contacts also cited increased demand
for mortgages as the key driver of overall loan demand.
Crude oil futures ended lower on
Wednesday, weighed down by concerns over a drop in energy demand after data
from Energy Information Administration (EIA) showed smaller than expected drop
in oil stockpiles and an increase in gasoline inventories. The EIA reported
that US crude inventories fell by 1 million barrels for the week ended October
16. That followed a 3.8 million-barrel decline the week before. On average, analysts polled by S&P Global
Platts forecast a weekly decrease of 1.9 million barrels. The EIA also said
Gasoline supply, meanwhile, climbed by 1.9 million barrels, while distillate
stockpiles fell by 3.8 million barrels last week. Meanwhile, the rising cases
of COVID-19 in the US and Europe, in particular, have led to the potential for
more economic shutdowns, which can impede demand for energy. Crude oil futures
for December fell $1.67 or 4 percent to settle at $40.03 a barrel on the New
York Mercantile Exchange. December Brent crude dropped $1.43 or 3.3 percent to
settle at $41.73 a barrel on London's Intercontinental Exchange.
Tumbling for third session in a
row; Indian rupee ended lower against dollar on Wednesday, on account of
sustained dollar demand from importers and banks. Traders were concerned with
Reserve Bank of India's latest analysis showing that the aggregate sales of
private sector manufacturing companies recorded a sharp contraction of 41.1 per
cent year-on-year in the first quarter of 2020-21 (Q1FY21), reflecting the
impact of the pandemic induced lockdown. However, downfall remain capped as
Commerce and Industry Ministry has said that foreign direct investment (FDI) in
India has increased by 16 percent to $27.1 billion during April-August period
of FY21 as compared to $23.35 billion received in same period last year. It
noted that the total FDI, which includes reinvested earnings, grew by 13
percent to $35.73 billion. On the global front, pound rose against the U.S.
dollar to a one-week high after the European Union's Brexit negotiator said
that a new trade deal with Britain was within reach. Finally, the rupee ended
at 73.58, 9 paise weaker from its previous close of 73.49 on Tuesday.
The FIIs as per Wednesday's data
were net buyer in both equity and debt segment. In equity segment, the gross
buying was of Rs 6521.67 crore against gross selling of Rs 4690.43 crore, while
in the debt segment, the gross purchase was of Rs 1367.26 crore with gross
sales of Rs 797.71 crore. Besides, in the hybrid segment, the gross buying was
of Rs 4.80 crore against gross selling of Rs 15.87 crore.
The US markets closed lower on
Wednesday after a volatile trading session, as investors worried whether
difficult negotiations in Washington would produce a deal for a fresh U.S.
coronavirus stimulus package. Asian markets are trading in red on Thursday after
a bumpy overnight session on Wall Street amid fears that agreement on a key
U.S. stimulus bill will not be reached until after the presidential election on
November 3. Indian markets ended Wednesday's volatile session on a higher note
led by gains in metals, realty and financial stocks amid positive global cues.
Today, the start of session is likely to be pessimistic on weakness in global
markets. Traders will be concerned as the International Monetary Fund slashed
this year's economic forecast for Asia, reflecting a sharper-than-expected
contraction in countries like India, a sign the coronavirus pandemic continues
to take a heavy toll on the region. There will be some cautiousness with a
private report that the government expects the fiscal deficit to be close to 7
percent of GDP or thereabouts in the current financial year. The general
deficit is unlikely to be lower than 11 percent, with the state government
borrowings estimated at 4 percent levels. Meanwhile, India on Wednesday
recorded over 56,000 cases, taking the tally to 7,705,158. Death toll rose to
116,653. However, some respite may come later in the day as Reserve Bank
Governor Shaktikanta Das said the country is at the doorstep of economic
revival on the back of accommodative monetary and fiscal policies being pursued
by the central bank and the government. Some support may come as the Reserve
Bank announced an on tap Targeted Long-Term Repo Operations (TLTRO) scheme of
up to Rs 1 lakh crore to enable banks to provide liquidity support to a host of
sectors, including agriculture, retail, drugs and pharmaceuticals and MSMEs.
Market participants may take note of Economic Affairs Secretary Tarun Bajaj's
statement that the government is open to further stimulus measures to boost the
coronavirus-hit economy. Agriculture industry stocks will be in focus as
Government-owned FCI and state procurement agencies have bought 106.88 lakh
tonnes of paddy so far in the kharif marketing season for Rs 20,180 crore.
There will be some reaction in Rubber industry stocks as the commerce ministry
recommended for continuation of anti-dumping duty on a Chinese synthetic rubber
for five more years with a view to guard domestic players from cheap imports.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous
close
|
Support
|
Resistance
|
NSE
Nifty
|
11,937.65
|
11,802.71
|
12,045.61
|
BSE
Sensex
|
40,707.31
|
40,246.52
|
41,072.06
|
Nifty Top volumes
Stock
|
Volume
|
Previous
close (Rs)
|
Support (Rs)
|
Resistance
(Rs)
|
(in
Lacs)
|
State
Bank of India
|
545.16
|
203.75
|
199.30
|
207.75
|
ICICI
Bank
|
431.25
|
420.30
|
410.90
|
429.10
|
Tata
Motors
|
392.53
|
130.25
|
128.00
|
132.80
|
NTPC
|
385.64
|
82.30
|
80.70
|
83.85
|
Indian
Oil Corporation
|
280.80
|
76.00
|
75.35
|
76.70
|
TCS and the University of Tokyo have entered into a strategic partnership to conduct joint academic-industry research.
Larsen & Toubro's construction arm -- L&T construction has secured orders from prestigious clients for its varied businesses.
IOC has raised Rs 2,000 crore through the issuance of 20000, 5.50% Unsecured, Listed, Rated, Taxable, Redeemable, NCDs (Series - XIX) of Rs 10,00,000 each on Private Placement basis.
Axis Bank has offered a host of discounts on various consumer platforms, as well as loans at special rates.