Indian equity benchmarks ended by
over a percent each lower on Wednesday, weighed down by the weakness in
banking, finance, metal and realty stocks amid weak global cues. Markets made
slightly negative start but soon managed to wipe out all the losses to trade in
green, as some respite came with Niti Aayog Vice Chairman Rajiv Kumar exuding
confidence that India's economic growth would be in positive territory in the
second half of this fiscal, and will do even better than a large part of the
world in 2021-22. However, buying proved short-lived as markets once again
entered into negative terrain and stayed in red for rest of the day, as traders
turned anxious with the central bank's statement that Indian states are racking
up more debt to fund the prospect of wider budget deficits as they step up
spending to fight the virus pandemic. Local gauges extended their losses in
late afternoon session, as some anxiety remained among traders with Finance
Minister Nirmala Sitharaman's statement that there were visible signs of
revival in the economy but the GDP growth may be in the negative zone or near
zero in the current fiscal (FY21). She also said the economy saw a contraction
in the April-June quarter, but demand has picked up in the festival season.
Sentiments remained down-beat after UNCTAD said that Global foreign direct
investment (FDI) flows fell 49% in the first half of 2020 compared to 2019 due
to the economic fallout from COVID-19. Separately, Union Minister Piyush Goyal
said the Commerce and Industry Ministry is working with states and local bodies
to make it easier for businesses to get licences, permissions and approvals. He
also said that the government is looking at addressing problems of quality so that
domestic products can be recognised for high quality. Finally, the BSE Sensex
fell 599.64 points or 1.48% to 39,922.46, while the CNX Nifty was down by
159.80 points or 1.34% to 11,729.60.
The US markets ended lower on
Wednesday amid continued concerns about a recent spike in coronavirus cases
across the US. The US has averaged more than 70,000 new coronavirus cases a day
over the past week, with 29 states setting new records this month for the most
new daily cases since the pandemic began in February. More than 8.78 million
cases have been reported nationwide and at least 226,000 people have died of
COVID-19, according to data from John Hopkins University (JHU). According to
JHU, the average number of daily new cases this past week is up 21 percent
compared to the previous week. The jump in new infections has also been
accompanied by an increase in hospitalizations and deaths, leading to worries
about new lockdowns. Meanwhile, President Donald Trump has continued to
downplay the pandemic in recent days, accusing the media of focusing too much
on the disease ahead of next week's elections. Besides, lingering uncertainty
about a new stimulus bill also weighed on markets, with some analysts
suggesting a victory by Joe Biden could make Republicans less likely to approve
a new relief package until next year.
Crude oil futures ended sharply
lower on Wednesday, weighed down by data showing a notable increase in crude
inventories. Data released by US Energy Information Administration showed crude
inventories in the US rose by about 4.3 million barrels in the week ended
October 23, rising for the first time in three weeks. The American Petroleum
Institute reported Tuesday that US crude inventories rose by 4.6 million barrels
to about 495.2 million barrels last week. Further, sentiments were weak on
worries about energy demand due to rising coronavirus cases. Several countries,
including the US, Germany, France and Spain are seeing sharp spikes in new
infections. Crude oil futures for December fell $2.18 or 5.5 percent to settle
at $37.39 a barrel on the New York Mercantile Exchange. December Brent crude
dropped $2.10 or 5.1 percent to settle at $41.20 39.10 a barrel on London's
Intercontinental Exchange.
Snapping previous day's gaining
streak, Indian rupee ended weaker against dollar on Wednesday with fresh dollar
demand by banks and importers. Besides, dollar gains against other currencies
overseas too hit the rupee sentiment. Investors were worried with Finance
Minister Nirmala Sitharaman's statement that there were visible signs of
revival in the economy but the GDP growth may be in the negative zone or near
zero in the current fiscal (FY21). She also said the economy saw a contraction
in the April-June quarter, but demand has picked up in the festival season.
Meanwhile, UNCTAD's latest Global Investment Trends Monitor stated that in the
wake of the pandemic, lockdowns around the world slowed existing investment
projects and the prospects of a deep recession led multinational enterprises to
reassess new projects. Also, global foreign direct investment (FDI) flows fell
49% in the first half of 2020 compared to 2019 due to the economic fallout from
COVID-19. On the global front, euro fell against the dollar on Wednesday
following a media report that France's government was leaning toward
reinstating a national lockdown to curb a resurgence in coronavirus cases.
Finally, the rupee ended at 73.87, 16 paise weaker from its previous close of
73.71 on Tuesday.
The FIIs as per Wednesday's data
were net buyer in equity segment, while net seller in debt segment. In equity segment, the gross buying was of Rs
10966.42 crore against gross selling of Rs 7377.28 crore, while in the debt
segment, the gross purchase was of Rs 540.52 crore with gross sales of Rs
1567.35 crore. Besides, in the hybrid segment, the gross buying was of Rs 9.88
crore against gross selling of Rs 16.96 crore.
The US markets tumbled on
Wednesday as a surge in coronavirus cases in the United States and Europe
dashed hopes of a quick global economic recovery. Asian markets are trading in
red on Thursday following an overnight plunge on Wall Street as coronavirus cases
continue to surge in the West. Indian markets ended around 1.5 percent lower on
Wednesday following in selloff in the global markets, dragged by losses in all
key sectors but mainly banks and financials. Today, the markets are likely to
get gap-down opening tracking sell-off in the global peers amid rising
coronavirus cases. Investors may also need to wrestle with volatility due to
October series derivative expiry. There will be some cautiousness with report
that India has reported a daily jump of nearly 50,000 Covid-19 cases, even as
the tally has soared past the 8-million mark. The country's death toll has
mounted to 120,563. However, some support may come later in the day with report
that in what could give a leg up to Prime Minister Narendra Modi's clarion call
to make India self-reliant or Atma Nirbhar, the government is considering to
come up with more calibrated fiscal and monetary policy measures to accelerate
growth to help economy recover from the impact of the pandemic. Meanwhile, the
Commerce and Industry Ministry has released the next edition of its
consolidated foreign direct investment (FDI) policy document, incorporating all
the changes made over the past year. Besides, edible oils trade body SEA has
urged the government not to tamper with the import duties or encourage PSUs to
import edible oils at concessional duties in a move to contain domestic prices.
Airline industry stocks will be in focus with the Directorate General of Civil
Aviation's statement that the suspension of scheduled international passenger
flights has been extended till November 30 amid the coronavirus pandemic. There
will be some reaction in real estate sector stocks with a private report
stating that the Indian real estate sector seems to be getting back on feet
after a long dry spell. Low home loan interest rates and discounted prices are
piquing consumer interest while the re-opening of offices and an overall
revival of business activity is aiding a revival in the office real estate
market. There will be lots of important earnings announcements too, to keep the
markets in action.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous
close
|
Support
|
Resistance
|
NSE
Nifty
|
11,729.60
|
11,633.16
|
11,877.71
|
BSE
Sensex
|
39,922.46
|
39,576.59
|
40,466.34
|
Nifty Top volumes
Stock
|
Volume
|
Previous
close (Rs)
|
Support (Rs)
|
Resistance
(Rs)
|
(in
Lacs)
|
Tata
Motors
|
1523.62
|
134.80
|
131.11
|
140.86
|
Bharti
Airtel
|
1235.86
|
451.85
|
433.24
|
479.24
|
State
Bank of India
|
464.62
|
190.45
|
188.00
|
193.95
|
NTPC
|
447.63
|
88.10
|
86.85
|
90.00
|
Axis
Bank
|
303.44
|
504.70
|
492.96
|
516.96
|
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