The equity benchmarks staged
smart recovery on Tuesday to end the session in green terrain, on account of
late hour value buying. After a weak start, the markets remained in red
territory for the most part of the session, impacted by former Reserve Bank of
India (RBI) Governor Raghuram Rajan's statement that at a time when the world
economy was growing, demonetisation slowed down India's economic growth and
impacted the GDP significantly. Domestic sentiments also remained dampened with
S&P Global Ratings' statement that the increasing involvement of the
government in the affairs of the Reserve Bank of India (RBI) could undermine
the hard-fought improvements in the banking system over the past few years. It
termed the exit of Urjit Patel as credit negative. Sentiments got hit with
reports that the Central Goods and Services Tax (CGST) department has detected
a fraud of GST and Input Tax Credit (ITC) in the metal scrap business across
Madhya Pradesh, Maharashtra and Gujarat. The fraud amount is likely to around
Rs 200 crore. However, the key indices erased all of their losses to settle
higher, continuing gaining rally for the sixth straight session, despite weak
trend in global markets. The street got relief with Prime Minister Narendra
Modi's statement that his government wants to ensure that 99 percent things
attract sub-18 per cent GST slab, indicating further simplification of the GST
is on the anvil. The markets participants took support with the Ministry of
Commerce's latest report showing that India's Foreign Direct Investment (FDI)
increased constantly to $60.97 billion in the financial year 2018 (FY18) from
$45.15 billion in Financial year 2015 (FY15). Further, adding some comfort
among the traders, the Export Import Bank of India (Exim Bank) said the
country's export growth will surge to 7 percent for the October-December
quarter. The Exim Bank estimate said merchandise exports will go up to $82.39
billion for the third quarter of the fiscal year, as against $77 billion. Meanwhile,
Niti Aayog Vice Chairman Rajiv Kumar said that there is a need to identify and
remove impediments that are stopping India from achieving a competitive
advantage in global markets. It is time to bring the global trends to domestic
market and make Indian manufacturing an exporting sector as it is an essential
growth enabler. Finally, the BSE Sensex surged 77.01 points or 0.21% to
36,347.08, while the CNX Nifty was up by 20.35 points or 0.19% to 10,908.70.
The US markets ended higher on
Tuesday on account of bargain hunting, with traders picking up stocks at
reduced levels on the heels of the sharp drop seen over the two previous
sessions. However, gains remained capped as traders remained on edge ahead of
the Federal Reserve's monetary policy announcement on Wednesday. With the Fed
widely expected to raise interest rates by a quarter point, traders are likely
to closely scrutinize the central bank's accompanying statement and forecasts
for clues about future rate hikes. Meanwhile, there was some cautiousness in
the markets as fears that sluggish global growth will wash up on US shores
continued to unsettle investors, and as uncertainty surrounding US-China trade
relations. On the economic front, the Commerce Department released a report
showing a substantial increase in US housing starts in November, as a spike in
multi-family starts more than offset a continued drop in single-family starts.
The Commerce Department said housing starts jumped by 3.2% to an annual rate of
1.256 million in November from the revised October estimate of 1.217 million.
Street had expected housing starts to edge down to a rate of 1.225 million from
the 1.228 million originally reported for the previous month. The report also
said building permits surged up by 5.0% to an annual rate of 1.328 million in
November from the revised October rate of 1.265 million. Dow Jones Industrial
Average surged 82.66 points or 0.35 percent to 23675.64, Nasdaq gained 30.18
points or 0.45 percent to 6783.91 and S&P 500 was up by 0.22 points or 0.01
percent to 2546.16.
Crude oil futures ended lower
with cut of over seven percent on Tuesday, sending benchmark crude prices to their
lowest finish in nearly 16 months, as concerns over a potential global supply
glut rattled the market. Losses for oil magnified after it was reported that
Russia was increasing its output to 11.42 million barrels a day this month.
Meanwhile, a recent US government forecast calling for further gains in
domestic shale oil production and expectations for an economic slowdown fed
concerns over a potential global glut in crude supplies. Benchmark crude oil
futures for January plunged $3.64 or 7.3 percent to settle $46.24 a barrel on
the New York Mercantile Exchange. February Brent crude dropped $3.35 or 5.6
percent to settle at $56.26 a barrel on London's Intercontinental Exchange.
Continuing
strong recovery momentum for the second day, Indian rupee ended near three-week
high against US dollar on Tuesday, on account of selling of American currency
by banks and exporters amid softening crude oil prices. Traders took
encouragement with the Ministry of Commerce's latest report showing that
India's Foreign Direct Investment (FDI) increased constantly to $60.97 billion
in the financial year 2018 (FY18) from $45.15 billion in Financial year 2015
(FY15). Investors also took note of Commerce and Industry Minister Suresh
Prabhu's statement that huge investment opportunities exist in India in various
sectors including construction for Turkish companies. On the global front, US
dollar slid lower against a currency basket on Tuesday ahead of this week's
Federal Reserve meeting while the yen remained supported amid concerns over the
outlook for global growth. Finally, the rupee ended at 70.44, Rs 1.12 stronger
from its previous close of 71.56 on Monday.
The FIIs as per Tuesday's data
were net sellers in equity and debt segments both. In equity segment, the gross
buying was of Rs 3238.59 crore against gross selling of Rs 3440.97 crore, while
in the debt segment, the gross purchase was of Rs 821.80 crore with gross sales
of Rs 833.72 crore. Besides, in the hybrid segment, the gross buying was of Rs
3.11 crore against gross selling of Rs 0.18 crore.
The US markets ended slightly
higher on Tuesday on the back of bargain hunting, with traders picking up
stocks at reduced levels on the heels of the sharp drop seen over the two
previous sessions. Investors also remained cautious ahead of the US Federal
Reserve's monetary policy decision due later in the day. Asian markets were
trading mixed on Wednesday following a volatile session on Wall Street. Indian
markets wiped out all of their early losses to end Tuesday trading session in
green territory for sixth straight day buoyed by gains in financials and oil
marketing companies after benchmark crude prices hit a 14-month low. Besides,
strong rupee also boosted investor sentiments. Today, the markets are likely to
open in green tracking a sharp fall in crude oil prices, easing macro concerns.
Traders will be getting encouragement with the Reserve Bank of India's (RBI)
statement that it has decided to scale up the amount of liquidity infusion by
Rs 10,000 crore to Rs 50,000 crore this month after a review of the evolving
liquidity conditions. The RBI also announced to conduct the purchase of
government securities under Open Market Operations (OMOs) for Rs 150 billion on
December 20. Some support may also come with chairman designate of Central
Board of Indirect Taxes and Customs P K Das saying that the next three months
would see the Centre put in place changes in policy and procedures to ensure
India further improves its position in the Ease of Doing Business Report-2019.
Traders may take note of Niti Aayog CEO Amitabh Kant's statement that achieving
double digit growth in the manufacturing sector on sustainable basis is a doable
challenge, but for that the country needs to integrate with global markets.
However, there will be some cautiousness with a private report that the
government's note ban decision shaved off economic growth by at least 2
percentage points for the October-December quarter of 2016 in which the
demonetisation move was effected. Meanwhile, India has been ranked 108th in
World Economic Forum (WEF) gender gap index, same as 2017, while recording
improvement in wage equality for similar work and fully closing its tertiary
education gender gap for the first time. There will be some buzz in the sugar
sector stocks with report that a delegation of domestic sugar industry held
discussions with top representatives of all three sugar refineries of South
Korea in Seoul with a view to increase shipment of the commodity. South Korea
imports around 1.5 million tonnes of raw sugar annually and the Indian sugar
industry is making efforts to export raw sugar from India during 2018-19 sugar
season.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,908.70
|
10,846.73
|
10,943.03
|
BSE Sensex
|
36,347.08
|
36,137.27
|
36,466.13
|
Nifty Top volumes
Stock
|
Volume
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
357.30
|
179.00
|
176.87
|
181.02
|
IOC
|
200.50
|
144.75
|
143.50
|
145.50
|
Tata Motors
|
180.16
|
174.75
|
172.70
|
177.20
|
ICICI Bank
|
154.06
|
362.25
|
356.93
|
365.23
|
Sun Pharma
|
144.02
|
433.45
|
423.23
|
439.28
|
M&M has signed agreement with Sampo Rosenlew Oy, Finland and has agreed to subscribe to 822 Equity Shares and 192 Compulsorily Convertible Preference Shares.
Bajaj Auto has launched the updated version of Platina 110 bike, priced at Rs 49,197.
Tata Steel and thyssenkrupp have decided on the members of the future Management Board for the planned European steel JV between the two companies.
TCS has extended its collaboration with Red Hat to build microservices-based open source solutions and frameworks that will accelerate customers' digital transformation journeys.