NSE Intra-day chart (28 April 2020) | | | Top Gainers | | | Top Losers | | | World Indices | | | Indices | | | FII Activity(Rs. Cr) | | |
| |
|
Market Commentary | | 29 April 2020 | |
Benchmarks to open in green amid positive Asian cues
Indian markets continued their
winning run for the second straight day and ended with gains of over a percent
on Tuesday, amidst positive global cues as governments across the world started
easing economic lockdown. Key indices made an optimistic start, as traders took
encouragement with report that Prime Minister Narendra Modi has underlined that
the lockdown has yielded positive results as the country has managed to save
thousands of lives in the past one and a half months. Some support also came as
the Reserve Bank of India (RBI) received Rs 64,746 crore worth of bids or more
than six times the amount it proposed to buy government bonds through the
special open market operation (OMO). However, the markets trimmed most of gains
in early noon session, as CRISIL, domestic rating agency, has nearly halved its
Gross Domestic Product (GDP) forecast for India to 1.8 percent for FY21 while
projecting total losses of Rs 10 lakh crore or Rs 7,000 per person due to
disastrous lockdowns to control COVID-19 pandemic. It warned lockdowns are
showing a disastrous impact on the economy and could lead to a permanent loss
of GDP, unemployment and poverty, despite relief packages. But, key indices
regained momentum to end with decent gains taking support from a private report
that the central government is considering a proposal to guarantee as much as
Rs 3 trillion ($39 billion) of loans to small businesses as part of a plan to
restart economy, which is reeling under the impact of a 40-day lockdown.
Finally, the BSE Sensex gained 371.44 points or 1.17% to 32,114.52, while the
CNX Nifty was up by 98.60 points or 1.06% to 9,380.90.
The US markets ended lower on
Tuesday as some traders to cash in on recent strength in the markets.
Cautiousness on markets came as traders looked ahead to the Federal Reserve's
monetary policy announcement on Wednesday. The Fed is widely expected to leave
interest rates unchanged at near-zero levels, although the central bank could
provide additional guidance regarding how long it plans to keep rates at their
current levels. However, downside remained capped on optimism that the US is
seeing the light at the end of the tunnel of the coronavirus pandemic. A number
of states such as George, South Carolina and Colorado have already stated
reopening, while other states like New York have announced plans to begin
reopening in the coming weeks. President Donald Trump's administration has also
unveiled a plan to ramp up testing, which experts have said is the most
important step toward reopening the economy. On the economic data front,
Consumer confidence in the US deteriorated significantly in the month of April,
according to a report released by the Conference Board, although the report
also showed an improvement in consumer expectations. The Conference Board said
its consumer confidence index plunged to 86.9 in April after tumbling to a
downwardly revised 118.8 in March. Street had expected the index to plummet to
90.0 from the 120.0 originally reported for the previous month. The steep drop
by the headline index came as the present situation index showed a record
nosedive to 76.4 in April from 166.7 in March. Consumers saying current
business conditions are good slumped to 20.8 percent from 39.2 percent, while
those climbing conditions are bad spiked to 45.2 percent from 11.7 percent.
Crude oil futures ended lower on
Tuesday on concerns about outlook for global energy demand and excess supply in
the global market. As the virus pandemic continues to ravage global economies,
it is highly unlikely that demand for oil will see any significant increase in
the near to medium term. Meanwhile, the United States Oil Fund LP said it would
exit its position in the front-month June crude oil futures contract and may
need to hold more cash to satisfy potential margin requirements. However, oil
prices rebounded from lower levels following a report that a bomb exploded on
an oil tanker in Syria. Crude oil futures for June dropped 44 cents or 3.4
percent to settle at $12.34 a barrel on the New York Mercantile Exchange.
However, June Brent crude gained 47 cents, or 2.4 percent to settle at $20.46 a
barrel on London's Intercontinental Exchange.
Indian rupee gave up all of its
initial losses and managed to end marginally higher against dollar on Tuesday,
on persistent selling of the American currency by exporters. Traders took
encouragement with report that Prime Minister Narendra Modi has underlined that
the lockdown has yielded positive results as the country has managed to save
thousands of lives in the past one and a half months. Healthy gains in domestic
equities and weakening of the greenback in overseas markets also supported the
Indian currency. However, gains remain capped as CRISIL, domestic rating
agency, has nearly halved its Gross Domestic Product (GDP) forecast for India to
1.8 percent for FY21 while projecting total losses of Rs 10 lakh crore or Rs
7,000 per person due to disastrous lockdowns to control COVID-19 pandemic. It
warned lockdowns are showing a disastrous impact on the economy and could lead
to a permanent loss of GDP, unemployment and poverty, despite relief packages.
On the global front, dollar steadied on Tuesday as currency markets entered a
holding pattern ahead of US Federal Reserve and European Central Bank meetings
later this week and as a fresh tumble in oil prices cautioned against risk
taking. Finally, the rupee ended at 76.18, 7 paise stronger from its previous
close of 76.25 on Monday.
The FIIs as per Tuesday's data
were net sellers in equity segment, while they were net buyers in debt segment.
In equity segment, the gross buying was of Rs 3983.52 crore against gross
selling of Rs 4754.15 crore, while in the debt segment, the gross purchase was
of Rs 2185.50 crore with gross sales of Rs 1638.61 crore. Besides, in the
hybrid segment, the gross buying was of Rs 10.00 crore against gross selling of
Rs 6.61 crore.
The US markets ended lower on
Tuesday as technology stocks took a hit ahead of earnings reports while
investors weighed moves to reopen the economy in coming weeks. Asian markets
are trading in green on Wednesday as investors await the US Federal Reserve's
decision on interest rates, expected later on Wednesday stateside. Indian
markets ended sharply higher on Tuesday as financials extended gains from the
previous session following the RBI's announcement of Rs 50,000 crore liquidity
facility for mutual funds. Today, the markets are likely to make positive start
following gains in Asian peers. Traders will be getting some encouragement with
private report that Finance Minister Nirmala Sitharaman is likely to announce
this week a second stimulus for the economy hit by a nationwide lockdown
triggered by the coronavirus pandemic, concluding multiple rounds of
discussions within the government. Traders may take note of report that the
Asian Development Bank has approved a $1.5 billion (about Rs 11,400 crore) loan
to India to help fund its response to the novel coronavirus pandemic, including
support for immediate priorities such as disease containment and prevention, as
well as social protection for the poor and economically vulnerable sections.
Though, investors may be concerned with report that the total number cases of
coronavirus cases in India has risen 31,324, and 1,008 people have died from
the fatal disease so far, according to Worldometer data. There may be some
cautiousness as Moody's Investors Service cut India's growth forecast to 0.2%
for 2020 from its earlier projection of 2.5%. The rating agency had earlier
slashed growth estimate from 5.2% to 2.5% after the government ordered a nationwide
lockdown for 21 days to contain the coronavirus. Also, Fitch Ratings said
India's sovereign rating of BBB- could come under pressure with a deteriorating
fiscal outlook arising from weaker growth due to the Covid-19 outbreak and the
lockdown. Meanwhile, Market regulator Sebi said it has invited proposals from
researchers to commission a study on various issues of stock markets. There
will be some reaction in auto stocks with Crisil's report that auto sales are
likely to remain muted as consumers may not flock to dealerships and even avoid
shopping malls and markets due to the fear of coronavirus infection for an
extended period post lockdown. Metal stocks will be in focus with the steel
ministry's report that India's crude steel production fell 23% to 7.38 million
tonne (MT) in March as compared to the previous month, while export and import
also took a beating due to the COVID-19 pandemic and the subsequent lockdown.
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
|
9,380.90
|
9,292.47
|
9,436.87
|
BSE Sensex
|
32,114.52
|
31,783.94
|
32,322.51
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Indusind Bank
|
606.11
|
476.95
|
443.17
|
497.57
|
State Bank of India
|
495.90
|
184.50
|
182.02
|
186.17
|
Axis Bank
|
439.39
|
457.50
|
442.37
|
465.52
|
Reliance Industries
|
358.66
|
1,430.00
|
1,396.28
|
1,459.58
|
Tata Motors
|
348.25
|
76.85
|
75.30
|
78.30
|
Axis Bank has received approval from its board of directors to acquire 29% stake in Max Life Insurance Company. Digitate, a software venture of TCS, has launched ignio Cognitive Procurement to help enterprises make smarter purchase decisions and take action faster. Bharti Airtel has signed multi-year agreement with telecom gear maker Nokia to deploy Nokia's SRAN solution across nine circles in India. Tata Steel has received approval to raise Rs 1,000 crore and allotted 10,000 - 7.70% Unsecured, Rated, Listed, Redeemable, Floating Coupon, NCDs of face value of Rs 10,00,000 each, to identified investor on private placement basis.
News Analysis
|