Monday's
session turned out to be a awful for the Indian equity benchmarks which tumbled
like a 'house of cards' and went on to breach various key technical levels in
the over two percent freefall. The frontline gauges which appeared to be on a
southbound journey, desperately kept searching for a bottom through the
session, but to no avail as the journey only halted with the session's close.
Sentiment took a big hit after Indian manufacturing activity contracted in
December for the first time in more than two years, hurt by softening domestic
demand, adding pressure on the central bank to ease policy. Earlier on Dalal
Street, the benchmark got off to a weak start as
the indices breached the psychological 7,900 and 26,000 levels in the early
moments of trade since investors largely remained influenced by the pessimistic
sentiments prevailing in Asian markets. Thereafter, the frontline indices lost
the plot and kept tumbling down the hill without any stoppage. The steep fall
turned even acute after the negative opening of European markets in the noon trades, as weak Chinese economic data
weighed on world stock markets. The indices barely managed to show signs of
stabilizing in the session as the downward drift halted only with the session's
close after suffering gargantuan losses. Moreover, the broader markets too
failed to show any kind of fervor and settled with large cuts of over a
percent. On the BSE sectoral space, the banking pocket finished at the top laggard
in the space, registering large cuts of over two and half percent as
heavyweights like SBI, ICICI Bank and Axis Bank plummeted by 2.94%, 2.83% and
2.35% respectively. Auto and Capital Goods counters too remained among
prominent losers in the space with over two percent cuts. Meanwhile, metal
stocks also reeled under pressure following by a weak PMI data in China,
while telecom stocks got hit post the order from the Telecom Regulatory
Authority of India (Trai) that has written to operators to ensure compliance
with call drop regulations, effective January
1, 2016. Finally the NSE's 50-share broadly followed index Nifty,
suffered over one hundred and fifty points laceration to settle below the
crucial 7,800 support level while Bombay Stock Exchange's Sensitive Index
Sensex got obliterated by over five hundred points and closed below the
psychological 25,620 mark.
The
US markets joining the global slump and suffered sharp cuts on Monday, with the
tech heavy Nasdaq falling to over its two months low on renewed concerns about
global growth, after a disappointing manufacturing data from China. Sentiments
were further weighed down by a report from the Institute for Supply Management,
showing a continued contraction in US manufacturing activity. The major averages
regained some ground going into the close but still ended the day firmly in the
red. The Dow Jones Industrial Average slumped by 276.09 points or 1.6 percent
to 17,148.94, the Nasdaq plunged by 104.32 points or 2.1 percent to 4,903.09
and the S&P 500 lost 31.28 points or 1.5 percent to 2,012.66.
Crude
oil futures too followed the equities sell-off and ended lower on Monday,
though the trade remained volatile. The prices earlier moved higher in
aftermath of an attack on the Saudi embassy over the weekend. Later a trio of
nations joined Saudi Arabia
in severing diplomatic ties with Iran,
escalating Islamic sectarian conflict in the Middle East
and Africa. It followed statements from Iranian
officials over the weekend that a rise in crude oil exports is dependent on
future global oil demand and should not further weaken oil prices. Iran
oil minister Bijan Zanganeh said the nation expects to raise its crude oil
exports by 1 million barrels per day in two phases after economic sanctions are
eased later this year. Benchmark crude oil futures for February delivery ended
down by $ 0.26, or 0.69 percent to $37.04, after trading in a range of $36.34
and $38.37 a barrel on the New York Mercantile Exchange. In London,
Brent crude for February delivery closed at $37.28, lower by $0.27 on the ICE.
Indian
rupee ended weaker against dollar on Monday due to increased demand for the
American currency from banks and importers, tracking losses in Asian currencies.
Besides weak trade in the local equity market also hit the sentiment of the
domestic currency. Sentiment remained downbeat after the India's
manufacturing sector output dipped in December to a 28-month low, the first
contraction in over two years, as new orders fell sharply and production took a
big hit from heavy rains in Chennai, putting pressure on RBI to keep rates low.
Furthermore, former Finance Minister, P Chidambaram stated that the government
has not been able to fulfill its promises, also weighed on the sentiment. On
the global front, yen hit its highest level against the dollar since October on
Monday as investors moved into the unit due to rising tensions in the Middle
East.
The
FIIs as per Monday's data were net buyers in equity segment, while they were
net sellers in debt segment. In the equity segment gross buying was of Rs 656.76
crore against gross selling of Rs 376.22 crore, while in the debt segment, the
gross purchase was of Rs 50.33 crore with gross sales of Rs 416.00 crore.
The US
markets suffered one of the worst yearly starts, with major averages losing
over one and half a percent in last session amid weak manufacturing data in China, as the spillover effects from a crash in there weighed on domestic equities.
The Asian markets have made a cautious start, with some of the indices trading
in red, still weighed down by Chinese economic growth concern. The Indian
markets made an awful start of the new week, melting down with global financial
markets as worries about a downturn in China
and fresh geopolitical tensions in the Middle East
spooked investors. Also, the domestic manufacturing sector contracted for the
first time in last two years. Today, the start is likely to remain cautious as
some of the Asian peers have again made a weak start, though some recovery can
be expected in latter part of the trade as traders will opt for some value
buying after the butchering of last session. However, there will be some
concern too, with retail inflation for farm labourers and rural workers in
November rising to 4.92 percent and 5.02 percent, respectively, due to increase
in prices of food items. Meanwhile, Finance minister Arun Jaitley held
pre-budget talks with farm sectors and trade unions and said that there is a need for
more investment in the farm sector as representatives from the key sector
sought a string of measures to revive agriculture. He said that reviving the
farm sector is a key priority for the government against the backdrop of
sluggish growth and two consecutive seasons of patchy monsoon rains. There will
be some action in the power sector stocks, as the power ministry Piyush Goyal
has said that fifteen states have joined the debt recast scheme for power
distribution companies covering 90% of the losses accumulated with the utilities.
There will be some buzz in the oil and gas stocks too, as the oil and gas
industry body PetroFed, whose members include state-owned ONGC and private
major Reliance Industries, has asked the government to allow natural gas
pricing freedom to existing fields like KG-D6.
Support and
Resistance: CNX Nifty and BSE Sensex
Index
|
Previous close
|
Support
|
Resistance
|
CNX
Nifty
|
7791.30
|
7735.75
|
7892.20
|
BSE
Sensex
|
25623.35
|
25441.11
|
25961.06 |
Nifty Top volumes
Stock
|
Volume
(in Lacs)
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
SBI
|
140.92
|
220.70
|
218.18
|
225.08
|
Vedanta
|
105.4
|
88.95
|
86.93
|
92.23
|
Hindalco
|
87.06
|
80.75
|
78.80
|
84.30
|
ICICI
Bank
|
85.78
|
255.55
|
253.02
|
259.72
|
Tata
Motors
|
78.23
|
377.05
|
368.03
|
393.08 |
- Mahindra & Mahindra has
inaugurated its all new Bio-CNG plant in Mahindra World City, Chennai.
- Coal India's subsidiary Mahanadi
Coalfields has unveiled a mobile app for live monitoring of field operations,
as a part of vigilance initiative in MCL.
- Bajaj Auto, the
second-largest motorcycle manufacturer has registered a marginal fall of 0.08%
in total sales to 2,89,003 units in December 2015 against 2,89,244 units in
December 2014.
- State Bank of India, country's largest public
sector lender, has opened its second sbiINTOUCH branch in Mumbai.
- Punjab National Bank has
launched slew of digital banking solutions aimed at improving customer
experience.