Profit booking in the recent
gainers spoiled the four-day upward rally of Indian equity benchmarks on
Thursday. After a cautious start, the markets remained lackluster throughout
the session, tracking weak global markets. Trading sentiments got hit with
Engineering Exports Promotion Council's (EEPC) statement that there was a sharp
annualised drop of over 54% in the gross bank credit deployment in the export
sector. It further noted that the Reserve Bank and the government need to
ensure timely and affordable bank credit for exporters to boost outbound
shipments. The market participants were seen taking note of the World Bank CEO
Kristalina Georgieva's statement that in this more challenging environment,
developing economies like India, must get ready to cope with possible
turbulence and to build fiscal and monetary space, to build policy buffers. She
also said that the growth of the global economy is expected to slow to 2.9% in
2019 compared with 3% in 2018. Traders remained pessimistic even though the
Federation of Indian Chamber of Commerce and Industry (FICCI) and PwC in their
latest survey report showed that India Inc expects Indian economy likely to
grow over 7% in the next 12 months on the back of a number of policy
initiatives taken by the government. In the second half of the session, the key
indices extended their losses to end near intraday low points, on account of
continuous selling on the counters. The market participants failed to take any
sense of relief with a private report indicating that India's December retail
inflation is expected to have eased to its lowest since June 2017 as food costs
fell and fuel prices rose at a slower pace, giving the central bank breathing
space to keep policy on hold. Investors even overlooked rating agency ICRA's
report that toll collections are likely to witness a double-digit growth in the
next financial year, propelled by an increase in commercial vehicle sales and
wholesale price index (WPI). The street even failed to take encouragement with
Finance Minister Arun Jaitley's statement that the government's electric
mobility programme will promote manufacturing and job creation and reduce
dependency on oil import, besides reducing pollution. Finally, the BSE Sensex
lost 106.41 points or 0.29% to 36,106.50, while the CNX Nifty was down by 33.55
points or 0.31% to 10,821.60.
Extending their gains for fifth
straight day, the US markets ended higher on Thursday as traders remain
optimistic the US and China will eventually reach a long-term trade deal.
Delegations from Washington and Beijing ended three days of trade negotiations
in China on Wednesday. China's commerce ministry said Thursday the negotiations
were extensive and had helped set up a foundation for further talks. This
week's face-to-face meetings were the first to take place since US President
Donald Trump and Chinese President Xi Jinping agreed to a 90-day truce last
month. If both sides are unable to secure a comprehensive trade agreement by
March 2, Trump has said he plans to raise tariffs to 25% from 10% on $200
billion worth of Chinese imports. However, gains remained capped as
disappointing holiday sales from Macy's and revenue guidance cut from American
Airlines pressured retail and airline shares. Fear that the US government
shutdown might continue for a long time also weighed on stocks. Macy's shares
tanked more than 18% - their worst day ever -after reporting its same-store
sales grew by just 1.1% in November and December. The company also cut its
earnings and revenue forecast for fiscal 2018.
On the economic front, the Labor Department released a report showing a
bigger than expected drop in initial jobless claims in the week ended January
5. The report said initial jobless claims fell to 216,000, a decrease of 17,000
from the previous week's revised level of 233,000. Street had expected jobless
claims to dip to 225,000 from the 231,000 originally reported for the previous
week. Dow Jones Industrial Average surged 122.80 points or 0.51 percent to
24001.92, Nasdaq rose 28.99 points or 0.42 percent to 6986.07 and S&P 500 was
up by 11.68 points or 0.45 percent to 2596.64.
Crude oil futures ended higher
for ninth straight session on Thursday, the longest winning streak in about
nine years for the US benchmark. Oil prices were significantly higher for the
week to date, with West Texas Intermediate (WTI) up about 9.7%. That will be
the largest weekly rise since December 2016. The recent advance for the energy
complex has been powered by optimism over US-China trade talk which ended
Wednesday, as well as a December output drop from major producers and a more-recent
decline in US crude inventories. Benchmark crude oil futures for February
gained 23 cents or 0.4 percent to settle $52.59 a barrel on the New York
Mercantile Exchange. March Brent crude added 24 cents or 0.4 percent to settle
at $61.68 a barrel on London's Intercontinental Exchange.
Indian
rupee, recovering from the early losses, ended slightly higher against the
American currency on Thursday, due to increased selling of the American
currency by exporters and banks. Sentiments got support with the Federation of
Indian Chamber of Commerce and Industry (FICCI) and PwC in their latest survey
report showed that India Inc expects Indian economy likely to grow over 7% in
the next 12 months on the back of a number of policy initiatives taken by the
government. Adding to the optimism, a private report indicated that India's
December retail inflation is expected to have eased to its lowest since June
2017 as food costs fell and fuel prices rose at a slower pace, giving the
central bank breathing space to keep policy on hold. The rupee's rise was also
aided by dollar's weakness against other currencies and falling crude oil
prices. On the global front, dollar on Thursday languished near a 3-month low
on signs the Federal Reserve may soon pause its interest rate tightening cycle.
Finally, the rupee ended at 70.41, 5 paise stronger from its previous close of
70.46 on Wednesday.
The FIIs as per Thursday's data
were net buyers in equity and debt segments both. In equity segment, the gross
buying was of Rs 4402.40 crore against gross selling of Rs 3924.61 crore, while
in the debt segment, the gross purchase was of Rs 1315.73 crore with gross
sales of Rs 881.57 crore. Besides, in the hybrid segment, the gross selling was
of Rs 0.07 crore against no buying.
The US markets ended higher on
Thursday after Federal Reserve Chairman Jerome Powell reiterated the central
bank's willingness to adjust its pace of interest-rate increases if economic
conditions weaken. Asian markets were trading in green on Friday in early
deals, after Federal Reserve Chairman Jerome Powell reiterated the US central
bank can be patient on raising interest rates further. Snapping four-day
winning streak, Indian markets ended near intra-day low levels on Thursday on
selling in banking shares amid negative cues from other Asian markets coupled
with jump in oil prices. Today, the markets are likely to make optimistic start
tacking firm global cues. Traders will be looking ahead to the Index of
industrial production (IIP) data for the month of November to be released later
in the day. Traders will be getting encouragement with report that the Goods
and Services Tax (GST) Council approved a series of measures aimed at
benefiting small businesses, such as a doubling of the exemption threshold to Rs
40 lakh and an increase in the turnover limit for service providers looking to
avail of the low-compliance composition scheme. The higher turnover cap of Rs
1.5 crore, against the earlier Rs 1 crore, for availing composition scheme of
paying 1 percent tax will be effective from April 01. While the exemption limit
for registration and payment of GST has been raised to Rs 40 lakh from Rs 20
lakh for suppliers of goods, states would have flexibility to decide on one of
those in a week. Some support may also come with Commerce Minister Suresh
Prabhu's statement that the government is considering providing transport
subsidy to states for promoting agriculture exports. On credit issues being
faced by exporters, he said, the financial services secretary would hold
meeting with banks on the matter. However, there may be some cautiousness with
a private report indicating that in the first eight months of FY 2018-19,
India's fiscal deficit target has overshot by 15 percent, largely due to a
revenue shortfall rather than front-loading of expenditure. It added that the
current run-rate of the government's GST revenues is tracking a shortfall of Rs
70,000-80,000 crore against the annual budget. Meanwhile, the Securities and
Exchange Board of India (SEBI) announced portfolio concentration norms for
equity exchange-traded funds (ETFs) and index funds. SEBI's new guidelines are
meant to address risks related to portfolio concentration in ETFs and index
funds. According to the new norms, the index shall have a minimum of 10 stocks
as its constituents. There will be some important earnings announcements also
to keep the markets buzzing. Infosys will release its financial results for the
third quarter of FY19 later in the day.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,821.60
|
10,795.82
|
10,853.37
|
BSE Sensex
|
36,106.50
|
36,028.40
|
36,226.95
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
362.97
|
186.90
|
184.43
|
189.13
|
Tata Motors
|
169.62
|
185.75
|
183.92
|
187.22
|
SBI
|
162.95
|
305.55
|
303.53
|
307.53
|
ICICI Bank
|
144.97
|
379.50
|
376.32
|
382.42
|
NTPC
|
127.84
|
148.10
|
146.72
|
149.52
|
Bajaj Finance has raised Rs 1,495 crore through allotment of 14950 Secured Redeemable NCDs of face value of Rs 10 lakh each.
Maruti Suzuki India has changed the prices of select models owing to increase in commodity prices and foreign exchange rates etc.
Mahindra & Mahindra has opened booking for its upcoming new compact SUV model XUV300 on January 09, 2019.
Tata Motors will launch 7-seat variant of Harrier in 2019, which has been code-named the H7X.