Tuesday turned out to be a dismal
day of trade for Indian equity benchmarks, where key gauges went home with a
cut of around a percent, breaching their crucial 33,400 (Sensex) and 10,400
(Nifty) levels. After making an optimistic start, markets failed to hold
momentum and entered into red terrain with traders shifting focus on corporate
earnings and developments related to PSUs. Sentiments remained dampened with
oil prices hitting their highest since July 2015 on Monday as Saudi Arabia's
crown prince cemented his power over the weekend through an anti-corruption
crackdown. Traders also remained concerned with a foreign brokerage which
reported that a year after the Indian government scrapped high denomination
currency notes, a wide range of indicators suggest the economy is still coming
to terms with the move. The report highlighted that while the initial scenes of
long queues of people exchanging notes disappeared within a month or so, the
shock measure left a rather lasting impact on informal economic activities,
bank deposits and digital transactions. It added that in an economy where 90
percent of employment and over 50 percent of Gross Domestic Product (GDP) is
derived from informal activities, this is bound to be a highly disruptive
process. Markets extended its southward journey in second half of the trade to
end near intraday lows. Traders failed to get any sense of relief with Finance
Minister Arun Jaitley's statement that excessive cash in the economy has 'its
own cost' and India is gradually moving towards digital transactions. Investors
paid no heed to the BMI Research's latest report that the ongoing economic
reforms and improvements to the business environment will continue to support India's
economic growth over the coming years, and they expect the country to be one of
the best performing emerging market economies, with real GDP growth set to
average 6.5 percent over the next five fiscal years. Finally, the BSE Sensex
declined 360.43 points or 1.07% to 33,370.76, while the CNX Nifty was down by
101.65 points or 0.97% to 10,350.15.
The US markets closed mostly
lower on Tuesday, though the Dow industrials eked out a modest gain to end in
record territory. The broader market was weighed down by a selloff in
financials, consumer discretionary and small-cap stocks amid concerns over the
timing and ultimate shape of tax legislation working its way through Congress.
Congressional Republican unveiled a long-awaited plan last week, though it was
unclear when the policy could be enacted, what form it might take, or even
whether it was likely to pass at all. On the economy front, the number of job
openings in the US rose slightly in September to 6.09 million, keeping them
near a record high. Job openings have topped 6 million for four months in a row
for the first time ever. Some 5.27 million people were hired, down from 5.42
million. And 5.24 million people lost their jobs, also down from the prior
month. The so-called quits rate among private-sector employees was unchanged at
2.4%. The quit rate edged up to 2.2% from 2.1% if government workers are
included. The Nasdaq dropped 18.65 points or 0.27 percent to 6,767.78, the
S&P 500 edged lower by 0.49 points or 0.02 percent to 2,590.64, while the
Dow Jones Industrial Average added 8.81 points or 0.04 percent to
23,557.23.
Crude oil futures cooled a bit on
Tuesday ahead of the inventory data and after Opec said it expected a surge in
North American shale output to cap demand for the cartel's crude oil. Opec in
its 2017 World Oil Outlook revised upwards North American shale oil to 5.1
million barrels per day (bpd) from 4.1 million bpd, citing the recent rally in
crude prices as one of the catalysts to drive up shale output. The U.S. Energy
Information Agency in separate report also revised upwards its estimate for
domestic crude oil production. Benchmark crude oil futures for December
delivery ended lower by $0.15 or 0.3 percent at $ 57.20 a barrel on the New
York Mercantile Exchange. Brent crude for January delivery was down by 57 cents
to $63.71 a barrel on the ICE.
Caught
in a downward spiral for the second straight session, Indian rupee ended
considerably weaker against the US dollar on Tuesday, on increased selling of
the US currency by exporters and banks. Besides, the fall in the rupee was also
triggered by dollar's appreciation overseas against a basket of major
currencies along with extremely bearish local equity markets. Traders even
overlooked BMI Research's latest report that the ongoing economic reforms and
improvements to the business environment will continue to support India's
economic growth over the coming years, and they expect the country to be one of
the best performing emerging market economies, with real GDP growth set to
average 6.5 percent over the next five fiscal years. On the global front,
dollar pushed higher against a basket of the other major currencies on Tuesday
as investors continued to monitor the progress of the US tax bill, while the
euro fell to the lowest level in three months. Finally, the rupee ended at
65.03, 35 paise weaker from its previous close of 64.68 on Monday.
The
FIIs as per Tuesday'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
5141.15 crore against gross selling of Rs 4403.05 crore, while in the debt
segment, the gross purchase was of Rs 782.70 crore with gross sales of Rs
1332.75 crore.
The US markets made a mixed
closing in the last session after a lackluster day of trade. The major averages
pulled back into negative territory after reaching record intraday highs in
early trading, as traders cashed in on some of the recent strength in the
markets. The Asian markets have made a similar start to the overnight closing
of the US markets and some of the indices are in red amid concern about the
progress of U.S. tax reforms, after a report that Senate Republican leaders are
considering a delay in the implementation of a corporate-tax cut. The Indian
markets suffered a sharp sell-off in the last session amid concerns that rising
oil prices may lift inflation and hit economic growth. Today, the start is
likely to remain cautious on sluggish global cues. Traders may however get some
support with report that net direct tax collections rose by 15.2 per cent to
Rs. 4.39 lakh crore between April and October this fiscal. This amounts to 44.8
per cent of the total Budget estimate of direct taxes of Rs. 9.8 lakh crore for
2017-18. Also, Arvind Panagariya, observing that the recent increase in India's
ease of doing business ranking by the World Bank was long overdue, has said the
country as a place for business is a lot more attractive than its ranking
suggests. In a other boost to the markets, private equity (PE) and venture
capital (VC) investments in India touched a new high of $21.8 billion in 2017
till date (January-October), surpassing the previous record of $19.6 billion in
2015. Meanwhile, the Insolvency and Bankruptcy Board of India (IBBI) - the
insolvency regulator - has tightened the due diligence framework on resolution
applicants, including promoters. Further, the IBBI has also imposed greater
responsibility on the resolution professional and Committee of Creditors in
discharging their duties. There will be lots of important earnings announcements
to keep the markets buzzing.
Support and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10350.15
|
10298.72
|
10443.67
|
BSE Sensex
|
33370.76
|
33186.40
|
33710.53
|
Nifty Top volumes
Stock
|
Volume
(in Lacs)
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
Yes Bank
|
304.44
|
311.70
|
303.80
|
321.30
|
Lupin
|
250.29
|
859.90
|
789.72
|
985.82
|
SBI
|
218.84
|
317.20
|
311.23
|
327.43
|
ONGC
|
205.60
|
193.80
|
189.30
|
201.90
|
Tata Motors
|
132.67
|
451.85
|
445.97
|
461.82
|
Tata Steel has set up the country's largest Coke Dry Quenching facility capable of handling 200 MT of the hot fuel per hour at its greenfield Kalinganagar steel plant in Odisha.
Lupin has received a warning letter issued by the USFDA on November 6, 2017, for its formulation manufacturing facilities at Goa and Indore.
Maruti Suzuki India has launched the ‘Royal Platinum Extended Warranty Programme' for extended assurance to its customers.
Tata Motors' subsidiary -- Jaguar Land Rover has reported total retail sales of 46,418 vehicles in October, up 0.2% on October 2016.