Indian equity benchmarks rallied
for second session in a row on Monday wherein the Sensex rose as much as 592
points and Nifty 50 index moved above its important psychological level of
11,200, lifted by across-the-board gain amid positive cues from global markets.
Domestic equities traded on a positive note since beginning, as traders took
support with report that the Finance Ministry is likely to provide capital
support from the Rs 20,000 crore fund approved by Parliament in recently
concluded session to some Public Sector Banks (PSBs) in the third quarter (Q3)
itself. Parliament approved Rs 20,000 crore for PSB capital infusion as part of
the first batch of Supplementary Demands for Grants for 2020-21 which sought
additional spending of a record Rs 2.35 trillion primarily to meet expenses for
combating the Covid-19 pandemic. Some support also came in with the RBI data
showing that bank credit grew 5.26 per cent to Rs 102.24 lakh crore while
deposits rose 11.98 per cent to Rs 142.48 lakh crore in the fortnight ended
September 11. Trading sentiments remained optimistic as union Minister Pratap
Chandra Sarangi has called for efforts by the local industry to capture the
country's huge domestic market, in line with Prime Minister Narendra Modi's
vision of Aatmanirbhar Bharat or a self-reliant India. Traders overlooked
S&P's statement that India's economy may experience a record contraction in
the current financial year mainly due to the global COVID-19 pandemic, and the
real GDP growth is expected to recover from next fiscal onwards. The agency
also affirmed its BBB- long-term and A-3 short-term foreign and local currency
sovereign credit ratings on India. Market participants paid no heed towards
Economic think-tank NCAER's quarterly review of the economy stated that India's
gross domestic product (GDP) growth is likely to decline by 12.6 percent during
the current financial year (FY21) on account of the impact of the coronavirus
pandemic on the business activities. Finally, the BSE Sensex rose 592.97 points
or 1.59% to 37,981.63, while the CNX Nifty was up by 177.30 points or 1.60% to
11,227.55.
The US markets ended higher on
Monday, extending the strong upward move seen in the previous session,
following a rally seen in the European markets, as traders picked up stocks at
relatively reduced levels. Traders seemed to shrug off recent concerns about a
surge in coronavirus cases and uncertainty about the US presidential
election. The markets have also
benefitted from optimism about a new coronavirus bill after House Speaker Nancy
Pelolsi said a new package is still possible. House Democrats plan to unveil a
new $2.4 trillion coronavirus relief bill. The price tag for the bill is $1
trillion less than a stimulus package the House passed back in May but may
still be too high for Republicans. Housing stocks showed a substantial move to
the upside on the day, driving the Philadelphia Housing Sector Index up by 3.7
percent. On the economic front, Cleveland Federal Reserve Bank President
Loretta Mester warned that the US economy remained fragile and will not fully
recover until actions are taken to promote a more inclusive economy.
Crude oil futures ended higher on
Monday recouping some of last week's losses, but concerns that the rise in
coronavirus cases throughout the globe will lead to weaker energy demand has
grown. However, contributing to support to oil prices was a possible disruption
to oil output in Norway. The Norwegian Oil and Gas Association said oil firms
in Norway plan to close down 22% of the country's oil-and-gas output, or 900,000
barrels of oil equivalent per day, if oil workers go on strike. Crude oil
futures for November rose 35 cents or 0.9 percent to settle at $40.60 a barrel
on the New York Mercantile Exchange. November Brent crude gained 51 cents or
1.2 percent to settle at $42.43 a barrel on London's Intercontinental Exchange.
Indian rupee ends considerably
lower against dollar on Monday on emergence of demand for the greenback from
importers. Sentiments were downbeat as Global rating agency S&P in its
latest report stated that the India's economy is likely to experience a record
contraction in the current financial year (FY21) mainly due to the global
Covid-19 pandemic, and the real GDP growth is expected to recover from next
fiscal onwards. Meanwhile, Reserve Bank of India (RBI) in its latest data has
showed that bank credit rose by 5.26 percent to Rs 102.24 lakh crore, while
deposits grew by 11.98 percent to Rs 142.48 lakh crore in the fortnight ended
September 11. On the global front; Sterling traders not panicked yet by new
Brexit brinkmanship. Britain may be heading for a no-deal Brexit in three
months, but among traders in London the feeling so far is one of deja vu rather
than a panicky rush to dump UK assets. Finally, the rupee ended at 73.79, 17
paise weaker from its previous close of 73.61 on Friday.
The FIIs as per Monday's data
were net seller in equity segment, while net buyer in debt segment. In equity
segment, the gross buying was of Rs 4555.98 crore against gross selling of Rs
7781.09 crore, while in the debt segment, the gross purchase was of Rs 882.78
crore with gross sales of Rs 359.60 crore. Besides, in the hybrid segment, the
gross buying was of Rs 4.89 crore against gross selling of Rs 8.08 crore.
The US markets closed sharply
higher on Monday as investors sought bargains among sectors hardest-hit by the
coronavirus recession, now limping toward its ninth month. Asian markets are
trading mostly in green on Tuesday amid logistics firm ZTO Express soared in
its Hong Kong debut. Indian markets ended considerably higher on Monday on
account of healthy buying in banking and auto stocks supported the indices amid
positive trend in the global markets. Today, the start of session is likely to
be flat-to-positive taking lead from Asian peers and notable gains on Wall
Street overnight. Traders will be taking some encouragement as the Reserve Bank
has decided to extend by six months the enhanced borrowing facility provided to
banks to meet liquidity shortage till March 31, 2021, amid the ongoing economic
woes created by the coronavirus pandemic. However, there may be some
cautiousness with report that the Reserve Bank has postponed the meeting of the
Monetary Policy Committee (MPC), the all-important interest rate-setting panel,
over a possible lack of quorum as the appointment of independent members is
delayed. Market participants may be concerned as ratings agency ICRA revised
its forecast for the contraction in India's FY21 GDP to 11 per cent from its
earlier assessment of 9.5 per cent. The ratings agency cited the elevated
levels of Covid-19 infections at the end of Q2FY21. Meanwhile, seeking to make
fund-raising easier, markets regulator Sebi has provided relaxations to REITs
and InvITs for preferential and institutional placement of their respective
units. Defence stocks will be in focus after the government yesterday unveiled
a new Defence Acquisition Procedure with a focus on significantly boosting
indigenous production. Under the new policy, the offset guidelines have also
been revised facilitating preference to defence majors offering to manufacture
products in India over relevant components. Besides, three IPOs to hit primary
market today. Likhitha Infrastructure, the Hyderabad-headquartered oil and gas
pipeline infrastructure service provider, will hit the market with its Rs 61.20
crore IPO. Mazagon Dock Shipbuilders, the only firm in India that makes
destroyers and submarines for the Indian Navy, will hit the primary market. UTI
Asset Management Company (AMC), the second-largest asset management company in
terms of total AUM and eighth-largest AMC in quarterly AUM, is also set to hit
the primary market.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,227.55
|
11,138.49
|
11,277.99
|
BSE Sensex
|
37,981.63
|
37,671.83
|
38,163.65
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Motors
|
618.31
|
133.10
|
128.96
|
135.76
|
State Bank of India
|
419.22
|
187.45
|
184.49
|
189.29
|
Oil & Natural Gas
Corporation
|
283.37
|
72.10
|
69.66
|
74.11
|
Indusind Bank
|
243.97
|
556.00
|
527.00
|
574.15
|
ITC
|
231.95
|
173.65
|
171.16
|
175.46
|
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