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NSE Intra-day chart (20 December 2019)
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Market Commentary 23 December 2019
Markets to get cautious start on Monday

 

Indian equity bourses managed to end Friday's volatile session at record closing highs, on account of firm cues from other Asian markets. The trading day was started on firm note, as DPIIT Secretary Guruprasad Mohapatra expressed optimism that India will soon break into the top 50 in the World Bank's ease of doing business ranking. Adding some relief among market participants, a private report indicated that it expects the Reserve Bank of India to cut the repo rate to 4.9% by March 2020 and 4.35% by September 2020 if global growth slows, and also said fiscal deficit is anticipated to slip to 3.8% of the GDP this year. But, volatility hit the street in noon deals, after investments through participatory notes (P-notes) in the Indian capital market dropped to Rs 69,670 crore at the end of November. The total value of investments via P-notes in the Indian markets (including equity, debt, and derivatives) declined by Rs 7,103 crore to Rs 69,670 crore by the end of November from Rs 76,773 crore at October-end. Finally, benchmarks settled the day with only marginal gains, as credit rating agency, Fitch Ratings cut India's GDP growth forecast for 2019-20 fiscal year to 4.6 percent on the deterioration in business and consumer confidence. Finally, the BSE Sensex gained 7.62 points or 0.02% to 41,681.54, while the CNX Nifty was up by 12.10 points or 0.10% to 12,271.80.

 

Continuing southward journey, the US markets settled at new record highs on Friday after encouraging US economic data. Traders continue to wait to hear the details of the agreement, but the news of the deal has still helped eliminate some of the uncertainty hanging over the markets. The Commerce Department released a report showing US economic growth in the third quarter was unrevised from the previous estimate. The Commerce Department said real gross domestic product jumped by 2.1 percent in the third quarter, unchanged from the estimate released last month and in line with street expectations. The unrevised GDP growth in the third quarter reflects a modest acceleration from the 2.0 percent increase seen in the second quarter. A separate report from the Commerce Department showed a notable acceleration in the pace of personal income growth in the month of November. The report said personal income climbed by 0.5 percent in November after inching up by a revised 0.1 percent in October. Street had expected personal income to rise by 0.3 percent compared to the virtually unchanged reading originally reported for the previous month. The Commerce Department said personal spending also climbed by 0.4 percent in November following a 0.3 percent increase in October. The spending growth matched street estimates.

 

Crude oil futures ended notably lower on Friday with losses of around a percent, as data from Baker Hughes showed a big increase in rig count in the US. According to a report released by Baker Hughes, rigs count in the US increased for a second straight week, rising by as much as 18 to 685 this week. As per the report, the total active US rig count also climbed by 14 to 813. Despite optimism on the trade front and the ongoing Organization of the Petroleum Exporting Countries (OPEC) output cuts, oil prices drifted lower in the session as traders looked keen on taking some profits ahead of the year-end holiday period. Benchmark crude oil futures for February declined 74 cents or 1.2 percent to settle at $60.44 a barrel on the New York Mercantile Exchange. February Brent fell 40 cents or 0.6 percent to settle at $66.14 a barrel on London's Intercontinental Exchange.

 

Extending weakness for the second day, Indian rupee ended marginally lower against dollar on Friday, as good demand for the greenback from importers. Traders remain concerned as credit rating agency, Fitch Ratings cut India's GDP growth forecast for 2019-20 fiscal year to 4.6 percent on the deterioration in business and consumer confidence. However, losses remain capped as some optimism remained among the traders with Prime Minister Narendra Modi's statement that the Indian economy has the resilience to reverse the current slowdown and return to high growth trajectory and he exhorted corporates to take bold investment decisions to help push up GDP growth. On the global front, dollar was largely steady against other major currencies on Friday but set for its best week in a month thanks to a stronger tone to economic data. Finally, the rupee ended at 71.12, 9 paise weaker from its previous close of 71.03 on Thursday.

 

The FIIs as per Friday'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 5401.92 crore against gross selling of Rs 4565.49 crore, while in the debt segment, the gross purchase was of Rs 1553.72 crore with gross sales of Rs 3007.85 crore. Besides, in the hybrid segment, the gross buying was of Rs 8.04 crore against gross selling of Rs 8.46 crore.

 

The US markets ended higher on Friday powered higher by new signs of economic strength that have followed a calming in trade tensions. Asian markets are trading mostly in red on Monday, with subdued volumes, as investors count down to the holiday break. Indian markets continued their record-breaking streak and ended higher with marginal gains on Friday led by gains in Banking, IT and metal stocks. Today, the start of futures and options (F&O) expiry week is likely to be cautious amid weakness in Asian peers. There will be some volatility during the week as the December series F&O contracts expire on Thursday, December 26. There will be some cautiousness with Assocham president Niranjan Hiranandani's statement that the economy is facing a liquidity problem and demand recession, and it requires measures to lift consumption, including reduction in goods and services tax and personal income tax and improved credit flow, to revive. However, some support may come later in the day with report that the foreign portfolio investors seem to have flocked to the Indian capital market in a big way in 2019 with a net inflow of over Rs 1.3 lakh crore, including Rs 97,250 crore in equities -- the highest in last six years. Traders may take note of minister for road transport & highways and MSMEs Nitin Gadkari's statement that India must increase its share in global trade to 8-10% to become a $5 trillion economy. There will be some buzz in the metal stocks with World Steel Association's (worldsteel) latest report showing that India's crude steel output fell for the second straight month in November, declining 2.8 per cent to 8.934 million tonne (MT). Telecom stocks will be in focus with Telecom Secretary Anshu Prakash's statement that India as a destination for telecom is world class and the spectrum auction could be expected to be utilised well by the telcos given India's communication potential. There will be some reaction in infra stocks with report that the government's endeavour for world-class infrastructure will continue unabated with commitment to pump in another Rs 15 lakh crore in the highways sector in this five-year term. Meanwhile, Titan Company, UltraTech Cement, Nestle India will be included in BSE Sensex with effect from December 23. On the other side, Tata Motors, Tata Motors DVR, Vedanta and Yes Bank will be removed from the index.

 

Support and Resistance: NSE (Nifty) and BSE (Sensex)

 

Index

Previous close

Support

Resistance

NSE Nifty

12,271.80

12,251.73

12,292.88

BSE Sensex

41,681.54

41,608.45

41,782.30

 

Nifty Top volumes

 

Stock

Volume

Previous close (Rs)

Support  (Rs)

Resistance (Rs)

(in Lacs)

Yes Bank

3,596.48

51.40

48.63

53.83

SBI

518.40

337.85

332.30

341.45

Tata Motors

488.18

175.95

173.30

180.15

Vedanta

471.72

144.25

141.47

148.77

ICICI Bank

276.92

546.10

540.40

550.65

 

  • Titan Company has incorporated Titan Global Retail LLC, Dubai, as a subsidiary company of Titan Holdings International FZCO, Dubai, which in turn is a wholly owned subsidiary of the Company. 
  • Bajaj Finance has invoked pledged shares of Karvy Data Management Services. 
  • NTPC's JV -- Energy Efficiency Services has signed a MoU with Baghirathi Sustainability India to explore the possibilities of promoting EVs in India.   
  • Zee Entertainment Enterprises is aiming to further strengthen its regional portfolio in India.
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