Indian equity benchmarks scaled
to fresh record closing highs on Monday, with Sensex and Nifty gaining more
than half a percent each. Key indices made a cautious start of the day, amid
reports that foreign investors have pulled out a net amount of Rs 4,375 crore
from the Indian capital markets in May so far, driven by global and domestic
factors. Trading sentiments were also subdued during early morning deals with
another private report stating that the fourth quarter (January to March 2019)
financial results released by 304 companies in the corporate sector show a
sequential drop in revenue growth to 10.7 per cent from 20.1 per cent in the
previous quarter (October to December 2018). Traders took a note of Niti Aayog
vice-chairman Rajiv Kumar's statement which stressed on the revamp and
modernisation of the Indian statistical system so that real-time data is
captured and used for policy analysis. But, markets soon gained ground to rally
throughout the session, as the Reserve Bank of India (RBI) said it will inject
Rs 15,000 crore into the financial system in the month of June 2019. It will
infuse liquidity through purchase of government bonds via the auction route.
Investors took encouragement after international rating agency S&P Global
Ratings said that the landslide victory for Prime Minister Narendra Modi-led
BJP in the general election is likely to improve the flow of foreign capital
for corporates in India. Adding more comfort, the Commerce and Industry
Ministry proposed cutting down compliance time significantly to just one hour
per month for start-ups as part of measures to ease regulatory requirements for
budding entrepreneurs. The proposal is a part of Start-up India Vision 2024,
prepared by the Department for Promotion of Industry and Internal Trade (DPIIT)
for the new government to promote the growth of budding entrepreneurs. Finally,
the BSE Sensex gained 248.57 points or 0.63% to 39,683.29, while the CNX Nifty
was up by 80.65 points or 0.68% to 11,924.75.
The US markets were closed on
Monday in observance of Memorial Day.
Indian rupee
ended marginally higher against dollar on Monday, owing to dollar sale by
banks. Traders took some support as Reserve Bank of India (RBI) has said it
will inject Rs 15,000 crore into the financial system in the month of June
2019. It will infuse liquidity through purchase of government bonds via the
auction route. Some support also came after international rating agency S&P
Global Ratings said that the landslide victory for Prime Minister Narendra
Modi-led BJP in the general election is likely to improve the flow of foreign
capital for corporates in India. However, upside remain capped with the RBI's
data showed that after rising for the past few weeks, the country's foreign
exchange reserves declined $2.057 billion to $417.998 billion in the week to
May 17 on account of a fall in foreign currency assets. Finally, the rupee
ended at 69.51, 2 paise stronger from its previous close of 69.53 on Friday.
The FIIs as per Monday's data
were net buyers in equity and debt segments both. In equity segment, the gross
buying was of Rs 6027.76 crore against gross selling of Rs 5635.78 crore, while
in the debt segment, the gross purchase was of Rs 2473.30 crore with gross
sales of Rs 967.92 crore. Besides, in the hybrid segment, the gross buying was
of Rs 11.52 crore against gross selling of Rs 28.31 crore.
The US markets remained closed on
Monday for the Memorial Day holiday. Asian markets are trading mostly in green
on Tuesday, following European gains, as relief over EU election results eased
concerns about political difficulties. Indian markets ended at another record
highs on Monday as investors continued to cheer Prime Minister Narendra Modi's
massive victory. Today, the start of session is likely to be cautious as there
will be some cautiousness with the Federation of Indian Chambers of Commerce
& Industry's (FICCI) statement that India's slowing economic growth is of
serious concern and the country needs to urgently cut tax and interest rates to
revive the economy. The economy grew 6.6 per cent in the three months to
December - the slowest pace in five quarters. It added that the recent signs of
a slowdown in the economy stem not only from slow growth in investments and
subdued exports but also from weakening growth in consumption demand. Traders
will also be concerned about rating agency Ind-Ra's statement that India's GDP
growth during the fiscal 2018-19 is expected at 6.9 per cent, marginally lower
than CSO's advance estimate of 7 per cent. It also urged the new government to
take short-term measures to arrest the slowdown in the economy. Besides, SBI
Ecowrap report said that the country's economic growth in the fourth quarter
ended March 2019 is expected to moderate to 6.1-5.9 per cent, which could pull
down growth rate for the entire fiscal 2018-19 to below 7 per cent. However,
some respite may come later in the day with report that the commerce ministry
is considering a major export promotion scheme to ensure expeditious refund of
central and state taxes and levies to boost shipments in the wake of global
challenges at trade front. The new scheme would ensure refund of all un-rebated
central and state levies and taxes imposed on inputs that are consumed in
exports of all sectors. There will be some buzz in the Information and
Technology (IT) sector stocks with Crisil's research wing stating that
profitability of IT companies is set to be impacted by adverse policies like
the one on H1-B visas in the key US market, with margins estimated to narrow by
up to 0.80 per cent in 2019-20. It added that revenues are set to rise by 7-8
per cent in dollar terms for the over $180 billion industry in this fiscal on
the back of faster growth in digital services. There will be lots of earnings
reaction based on the performance of the companies.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,924.75
|
11,839.05
|
11,983.80
|
BSE Sensex
|
39,683.29
|
39,416.99
|
39,885.77
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
672.58
|
146.80
|
142.28
|
149.88
|
SBI
|
313.75
|
361.70
|
356.30
|
364.80
|
ICICI Bank
|
233.97
|
435.50
|
430.50
|
439.65
|
NTPC
|
199.49
|
133.20
|
130.03
|
136.48
|
Tata Steel
|
182.08
|
512.55
|
492.63
|
523.38
|
HDFC has sold 6.10% stake in its subsidiary -- Gruh Finance, to comply with the RBI requirement for facilitating the proposed merger of the housing finance arm with Bandhan Bank.
NTPC has reported 48.70% rise in its net profit at Rs 4,350.32 crore for the quarter ended March 31, 2019 as compared to Rs 2,925.59 crore for the same quarter in the previous year.
Cipla is looking at continued growth across all its key markets in the FY20 and plans to file over 12 abbreviated new drug applications during the period.
GAIL (India) has reported 9.92% rise in its net profit at Rs 1,122.23 crore for the quarter under review as compared to Rs 1,020.92 crore for the same quarter in the previous year.