Bulls made a comeback over Dalal
Street on Monday, with the Sensex and the Nifty ending higher by around 1.30%
each. The start of the day was firm, after the share of foreign portfolio investments
(FPI) in domestic capital markets through participatory notes (P-notes) jumped
to Rs 76,773 crore at the end of October from Rs 76,611 crore at September-end.
Adding some comfort among market participants, a survey by the National
Statistical Office (NSO) showed that urban unemployment rate dropped to the
lowest level in four quarters at 9.3 per cent during January-March 2019.
Extending their earlier gains, key equity benchmarks settled the trading
session near their intraday high points, on account of firm cues from European
markets. Domestic sentiments got a boost, as the Organisation for Economic
Cooperation and Development (OECD) forecasted Indian economy to grow 6.2% in
2020 and further to 6.4% in 2021. Further, investors also remained encouraged,
with the Commerce and industry minister Piyush Goyal's statement that reform
momentum towards self-certification, labour laws and environment clearance will
boost investment and production. Finally, the BSE Sensex rose 529.82 points or
1.31% to 40,889.23, while the CNX Nifty was up by 159.35 points or 1.34% to
12,073.75.
The US markets ended higher on
Monday on optimism about a US-China trade agreement after a tabloid run by
China's ruling Communist Party discounted negative reports and said the
economic superpowers are very close to a phase one deal. A private report said
China remains committed to continuing talks for a phase two or even a phase
three deal with the United States. President Donald Trump and Chinese President
Xi Jinping have also recently made positive comments about a potential trade
deal despite reports of complications arising that could delay the agreement
until next year. Meanwhile, reports on the merger-and-acquisition front also
generated positive sentiment, as the deals suggest companies remain confident
even with the uncertainty created by the US-China trade dispute. Shares of The
Medicines Company (MDCO) moved sharply higher after the biopharmaceutical
company agreed to be acquired by Swiss drugmaker Novartis for $9.7 billion or
$85 per share in cash. Jeweler Tiffany (TIF) also showed a strong move to the
upside after agreeing to be acquired by France's LVMH for $16.2 billion or $135
per share in cash. Discount broker Charles Schwab (SCHW) also reached an
agreement to acquire rival TD Ameritrade (AMTD) in an all-stock transaction
valued at approximately $26 billion. Besides, the pro-democracy opposition in
Hong Kong swept to a resounding victory in weekend elections, winning a
commanding majority in the vote for 452 district council seats. District
councils have little power, but the showing could put pressure on the
government to negotiate with protesters demanding democratic elections for the
city's legislature and chief executive. The result is also seen as a defeat for
Beijing, which has pushed Hong Kong to crack down on protests.
Crude oil futures ended higher on
Monday as worries about outlook for energy demand subsided a bit after positive
comments from the US and China raised optimism about a phase one trade deal
between the two countries. Besides, expectations that oil output cuts will be
extended until mid-2020 by Organization of the Petroleum Exporting Countries
(OPEC) and allies contributed as well to oil's uptick. The OPEC meeting is
scheduled to take place on December 5 in Vienna. Benchmark crude oil futures
for January gained 24 cents or 0.4 percent to settle at $58.01 a barrel on the
New York Mercantile Exchange. January Brent rose 26 cents or 0.4 percent to
settle at $63.65 a barrel on London's Intercontinental Exchange.
Erasing
all of its initial gains, Indian rupee ended marginally weaker against the US
dollar on Monday, due to increased demand of the greenback from the importers
and the banks. Traders remained cautious with report that the government raised
concerns over fake invoices being generated in the business-to-business (B2B)
segment which is impacting GST collections. The domestic currency was also
weighed down by dollar's strengthen against some other currencies. However,
losses were limited as some optimism remained among the traders with RBI's
report that India's forex reserves rose by $441 million to a fresh lifetime
high of $448.249 billion in the week to November 15 on an increase in core
currency assets. On the global front, euro edged lower against the dollar on
Monday as investors remained cautious about the outlook for the euro zone
economy in the near term. Finally, the rupee ended at 71.74, 3 paise weaker
from its previous close of 71.71 on Friday.
The
FIIs as per Monday's data were net buyers in both equity and debt segments. In
equity segment, the gross buying was of Rs 5376.66 crore against gross selling
of Rs 4769.72 crore, while in the debt segment, the gross purchase was of Rs
676.66 crore with gross sales of Rs 268.21 crore. Besides, in the hybrid
segment, the gross buying was of Rs 41.02 crore against gross selling of Rs
1.41 crore.
The US markets ended in green on
Monday amid increasing expectations that China and the US will reach a
so-called phase one trade deal. Asian markets are trading mostly higher on
Tuesday amid optimism over US-China trade talks and a fresh wave of merger and
acquisition activity. Indian markets ended higher on Monday with Sensex hitting
a fresh closing high of 40,889.23, driven by gains mainly in telecom, metal and
auto stocks. Today, the markets are likely to make optimistic start following
firm global cues. Traders will be taking some encouragement with the payroll
data of Employees' State Insurance Corporation (ESIC) showing that around 12.23
lakh jobs were created in September as compared to 13.38 lakh in August 2019.
As per the report, gross enrolments of new subscribers with the ESIC were 1.49
crore during the entire 2018-19 fiscal. Besides, the Central GST collection so
far this fiscal stood at Rs 3.26 lakh crore, which is around half the
government's target for 2019-20. The Budget Estimates for Central Goods and
Services Tax (GST) for 2019-20 has been fixed at Rs 6,63,343 crore. Some
support will also come with Union Minister Nitin Gadkari's statement that the
government is in the process of launching Digital data-based credit ratings of
Micro, Small and Medium Enterprises (MSME), to help entrepreneurs to get bank
loans on the basis of these credit ratings. However, there may be some
cautiousness as Indian government think tank NITI Aayog cautioned the
government that the path to a $5-trillion economy by 2025 is plagued with
several hindrances. It added that while the nominal gross domestic product
(GDP) growth rate was a mere 8 per cent in the first quarter of this fiscal, it
has to be at least 12.4 per cent on an average for achieving that target.
Meanwhile, Finance minister Nirmala Sitharaman in Lok Sabha introduced the
Taxation Laws (Amendment) Bill, 2019 that seeks to replace the ordinance,
issued on September 20, to slash corporate tax rate to 22% without incentives
and 15% for new manufacturing entities. There will be some buzz in the banking
stocks with Minister of State for Finance Anurag Thakur's statement that the
gross non-performing assets (NPAs) of scheduled commercial banks (SCBs) have
declined by nearly Rs 98,000 crore to Rs 9.38 lakh crore by June-end this year.
Telecom stocks will be in focus as a report said with the Cabinet allowing
telecom operators to defer payments due for airwaves bought via auction until
the end of March 2022, a committee of secretaries constituted to look at relief
package for the debt-laden and loss-making sector has been wound-up. There will
be some reaction energy stocks as the Indian Minister of New and Renewable
Energy expressed confidence that the country will overachieve on its target to
have 175 gigawatts of renewable energy capacity operational by 2022.
Support and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
12,073.75
|
11,967.50
|
12,132.25
|
BSE Sensex
|
40,889.23
|
40,544.85
|
41,082.66
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
1,719.23
|
63.75
|
62.20
|
65.40
|
Bharti Airtel
|
334.84
|
451.40
|
429.95
|
464.25
|
Tata Steel
|
276.12
|
419.50
|
408.00
|
426.00
|
SBI
|
275.61
|
336.10
|
330.47
|
339.62
|
Tata Motors
|
261.31
|
166.10
|
161.80
|
168.50
|
NTPC is planning to raise around Rs 10,000 crore through green bonds for acquisition of the government's stake in THDCIL and NEEPCO.
The coal ministry has asked Coal India to either expedite the operationalization of 110 additional blocks allotted to it or return the mines to the government.
SBI has raised Rs 3,813.60 crore through perpetual bonds to fund its business growth.
Power Grid has been declared as the successful bidder in two Intra-State Transmission System Projects of UP State under Tariff Based Competitive Bidding.