Indian equity markets traded with
volatility but in green and ended higher on Tuesday, buoyed by banks and metal
stocks amid positive cues from global peers. Sensex and Nifty closed above
their crucial 38,400 and 11,300 levels, respectively. Markets had a gap up
opening, supported by better-than-expected quarterly earnings together with
rupee appreciation. Traders took encouragement with Commerce and Industry
Minister Piyush Goyal's statement that India's balance of payments this year is
going to be very, very strong on the back of significant improvement in exports
and a fall in imports. Some support also came in as Union Minister Nitin
Gadkari said the government is working on the idea of a land bank and a social
microfinance institution to help people run small shops and businesses.
However, key gauges trimmed most of their gains to come off day's high in
afternoon session, as the Covid-19 cases continued to rise unabated. Some
cautiousness prevailed with ratings agency ICRA's report that the coronavirus
pandemic will significantly impact performance of companies and it is likely to
be severe and prolonged for select sectors, especially aviation, hospitality
and retail. It added the pandemic, followed by extended lockdowns in India both
nationally and then localised, has impacted India Inc for the major part of the
first quarter of the current financial year. But, markets regained some
momentum in final hour of trade, taking support from Food and Public Distribution
Secretary Sudhanshu Pandey's statement that the country's economy is reviving
from the impact of COVID-19 pandemic and this is visible from the performance
of sectors such as FMCG and agriculture. He said that FMCG revenues have come
back to almost 85 percent of pre-COVID times, which is an important indicator.
Finally, the BSE Sensex gained 224.93 points or 0.59% to 38,407.01, while the
CNX Nifty was up by 52.35 points or 0.46% to 11,322.50.
The US markets ended lower on
Tuesday as a selloff in tech shares continued and investors assessed the
outlook for the economy amid a slowing in the number of new coronavirus cases
and a lack of progress toward additional coronavirus aid from Washington.
However, downside remained capped as white House officials and top Democratic
lawmakers indicated they were ready to resume talks on a coronavirus aid
package after President Donald Trump over the weekend signed executive orders
that would extend some elements of existing help that lapsed at the end of
July, though there as little sign of movement. Trump's orders, meanwhile, could
face legal and logistical hurdles. On the economic data front, partly
reflecting a notable increase in prices for services, the Labor Department
released a report showing US producer prices climbed by more than expected in
the month of July. The Labor Department said its producer price index for final
demand rose by 0.6 percent in July after dipping by 0.2 percent in June. The
rebound in producer prices reflected the largest increase since October of 2018
and exceeded street estimates for an uptick of 0.3 percent. Energy prices
showed another substantial increase during the month, spiking by 5.3 percent in
July after soaring by 7.7 percent in June.
Crude oil futures settled lower
on Tuesday amid traders eyed developments tied to efforts toward economic
relief from the impact of the coronavirus. White House officials and top
Democratic lawmakers indicated they were ready to resume talks on a coronavirus
aid package after President Donald Trump over the weekend signed executive
orders that would extend some elements of existing help that lapsed at the end
of July, though there as little sign of movement. Besides, in a monthly report
issued, the US Energy Information Administration raised its 2020 forecasts for
US and global benchmark oil prices, but reduced its US crude production outlook
for this year. It also lifted its outlook for natural-gas prices to $2.03 per
million Btus, up 5.4% from the July forecast. Crude oil futures for September
declined 33 cents or 0.8 percent to settle at $41.61 a barrel on the New York
Mercantile Exchange. October Brent crude fell 49 cents or 1.1 percent to settle
at $44.50 a barrel on London's Intercontinental Exchange.
Rising for third straight
session, Indian Rupee ended stronger against dollar on Tuesday due to selling
of the American currency by banks and exporters. Traders were optimistic with
Commerce and Industry Minister Piyush Goyal's statement that India's balance of
payments this year is going to be very, very strong on the back of significant
improvement in exports and a fall in imports. He said that good green shoots
are visible in the economy and exports have shown a good turnaround. Gains in
domestic equity markets also provided support to the rupee. On the global
front, dollar maintained its gains on Tuesday after rising to a one-week high
against the euro as US-China tensions and a stalemate in the US Congress over
fiscal stimulus supported safe-haven assets. Finally, the rupee ended at 74.78,
12 paise stronger from its previous close of 74.90 on Monday.
The FIIs as per Tuesday's data
were net buyers in equity, while they were net sellers in debt segment. In
equity segment, the gross buying was of Rs 5867.71 crore against gross selling
of Rs 4595.39 crore, while in the debt segment, the gross purchase was of Rs
142.47 crore with gross sales of Rs 439.31 crore. Besides, in the hybrid
segment, the gross buying was of Rs 34.66 crore against gross selling of Rs
27.14 crore.
The US markets ended lower on Tuesday
amid growing uncertainty about an additional round of US fiscal stimulus. Asian
markets are trading mostly in red on Wednesday as investors continue to monitor
coronavirus developments. Indian markets ended higher on Tuesday with
consistent foreign fund flows on the back of better-than-expected corporate
earnings coupled with a sustained increase in coronavirus recoveries. Today,
the markets are likely to make negative start tracking weakness in global
peers. Investors will be looking ahead to the CPI inflation data for July which
is released later in the day. there are expectations that India's retail
inflation edged up slightly in July due to higher food prices, remaining firmly
above the RBI's medium-term target of 4 per cent for a 10th straight month.
Traders will be eyeing the upcoming GST Council meeting, which shall meet on
only a single-point agenda, anytime in August, to iron out measures to meet the
compensation requirements, is likely to discuss three top suggestions to raise
compensation funds. There will be some cautiousness as India again recorded
over 61,000 cases in 24 hours, taking its tally way past the 2.3-million mark.
With 835 fatalities in a single day, the country's death toll has risen to
46,188, very close to the UK's toll. Market participants will be concerned with
the government data showing that industrial production declined by 16.6 percent
in June, mainly due to lower output of manufacturing, mining, and power
generation. According to the Index of Industrial Production (IIP) data,
manufacturing sector production registered a decline of 17.1 percent, while the
output of mining and power fell 19.8 percent and 10 percent, respectively.
Though, some support may come later in the day with a private report that the
Department of Promotion of Industry and Internal Trade (DPIIT) has proposed
short- and-long-term measures to turn Indian into a manufacturing hub for auto
components and air conditioning. Traders may take note of a report that
industry body Confederation of Indian Industry (CII) suggested an open and
facilitative import environment on the lines of ASEAN, to make India an
exporting hub. Banking stocks will be in focus as Fitch Ratings believes
Reserve Bank of India's (RBI) recent proposal to allow banks to restructure
loans may extend uncertainty over the banking sector's asset quality. There
will be some reaction in rail-related stocks after the Railways stated that all
regular passenger train services will remain suspended till further notice,
although 230 special trains will continue to be in service. There will be
earnings reaction based on the performance of the companies.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,322.50
|
11,289.90
|
11,364.35
|
BSE Sensex
|
38,407.01
|
38,294.63
|
38,537.84
|
Nifty Top volumes
Stock
|
Volume
|
Previous
close (Rs)
|
Support (Rs)
|
Resistance
(Rs)
|
(in
Lacs)
|
ITC
|
551.43
|
203.05
|
199.46
|
207.16
|
Tata Motors
|
502.25
|
122.30
|
120.54
|
124.94
|
Zee Entertainment
Enterprises
|
466.05
|
159.75
|
154.55
|
162.95
|
ICICI Bank
|
454.47
|
367.35
|
362.84
|
373.09
|
State Bank of India
|
438.92
|
195.05
|
193.60
|
196.65
|
Dr. Reddy's Laboratories has launched Ciprofloxacin 0.3% and Dexamethasone 0.1% Otic Suspension, USP, approved by the USFDA.
Titan Company has incorporated a wholly owned subsidiary company Titan Commodity Trading on August 10, 2020.
Axis Bank has raised Rs 10,000 crore through allotment of equity shares to qualified institutional buyers.
Tata Motors in association with WATConsult has launched Atmanirbharta - a digital campaign highlighting the existence of localisation in everything that the company do.