Indian equity benchmarks settled
with minor cut on Thursday after fluctuating between gains and losses during
the session, following weak Asian equities. Trade was largely range-bound for
most part of the session owing to volatility as weekly index future and option
contracts expired today. Markets made positive start and managed to trade above
their neutral lines, as traders took some support with report that India has
moved four places on the Global Innovation Index (GII) 2020 to rank at 48 since
2019. This makes it the third-most innovative lower middle-income economy in
the world. India at the 48th place also retains the highest rank in the central
and southern Asia region. However, markets witnessed some selling activity in
afternoon deals, as traders turned wary with Federation of Indian Export
Organisations (FIEO) stating that the government's decision to cap export
incentives under the Merchandise Exports from India Scheme (MEIS) at Rs 2 crore
per exporter on exports made between September 1, 2020 to December 31, 2020 is
going to seriously affect traders and cause uncertainty. However, key gauges
once again entered into green terrain in late afternoon session, amid the
latest IHS Markit Services Purchasing Managers' Index (PMI) indicated a slower
rate of decline in business activity across the Indian service sector during
August. The ongoing coronavirus pandemic 2019 (COVID-19) restrictions continued
to adversely impact client demand and business operations. New business and
output continued to contract at marked rates, albeit slower than the records
seen in April and May. But, markets failed to hold gains and ended marginally
lower, as rising coronavirus cases in the country dampened sentiments in the
markets. Meanwhile, the 15th Finance Commission will hold a meeting with its
economic advisory panel on Friday to discuss issues of GDP growth, GST
compensation and fiscal consolidation. Finally, the BSE Sensex fell 95.09
points or 0.24% to 38,990.94, while the CNX Nifty was down by 7.55 points or
0.07% to 11,527.45.
The US markets ended deeply in
red on Thursday as some traders looked to cash in on the recent strength in the
markets. Tech giants Apple, Microsoft Alphabet and Amazon all posted steep
losses on the day following recent strength. The fall came a day after the
S&P 500 claimed its 22nd record close of the year, while the tech-heavy
Nasdaq Composite arrived at its 43rd such all-time high and the Dow topped the
29,000 level for the first time since February. On the economic data front, the
Labor Department released a report showing first-time claims for US
unemployment benefits tumbled by more than expected in the week ended August
29th. The Labor Department said initial jobless claims declined to 881,000, a
decrease of 130,000 from the previous week's revised level of 1.011 million.
Street had expected jobless claims to drop to 950,000 from the 1.006 million
originally reported for the previous week. A separate report from the Institute
for Supply Management (ISM) showed a modest slowdown in the pace of growth in
service sector activity in the month of August. The ISM said its services PMI
dipped to 56.9 in August from 58.1 in July, but a reading above 50 still
indicates growth in the service sector. Street had expected the index to edge
down to 57.0. Meanwhile, with imports spiking by more than exports, the
Commerce Department released a report showing the US trade deficit widened by
much more than expected in the month of July. The Commerce Department said the
trade deficit expanded to $63.6 billion in July from a revised $53.5 billion in
June. The deficit in July was the widest since reaching $67.0 billion in July
of 2008. Street had expected the trade deficit to widen to $58.0 billion from
the $50.7 billion originally reported for the previous month.
Crude oil futures ended lower on
Thursday as concerns remained over the outlook for demand. Oil prices saw even
steeper losses as the US stock market sold off sharply on the heels of a tech
selloff. Meanwhile, oil production in the Gulf of Mexico region has seen a
significant recovery since the hurricane made landfall on August 27. The Bureau
of Safety and Environmental Enforcement estimated that 16.3% of current oil
production in the Gulf of Mexico was shut in, rebounding from about 84% around
the time Laura reached the Gulf Coast. Crude oil futures for October lost 14
cents or 0.3 percent to settle at $41.37 a barrel on the New York Mercantile
Exchange. November Brent crude declined 36 cents or 0.8 percent to settle at
$44.07 a barrel on London's Intercontinental Exchange.
Tumbling for second straight
session, Rupee ended substantially weaker against dollar on Thursday on account
of continued dollar demand from importers and banks. Traders remained concern
as FIEO stated that the government's decision to cap export incentives under
the Merchandise Exports from India Scheme (MEIS) at Rs 2 crore per exporter on
exports made between September 1, 2020 to December 31, 2020 is going to
seriously affect traders and cause uncertainty. Market participants paid no
heed to IHS Markit Services Purchasing Managers' Index (PMI) indicated a slower
rate of decline in business activity across the Indian service sector during
August. The ongoing coronavirus pandemic 2019 (COVID-19) restrictions continued
to adversely impact client demand and business operations. On the global front;
pound fell against the dollar on Thursday, extending its losses on a
combination of dollar strength and weak domestic factors: the long-term damage
to Britain's economy from the coronavirus and a lack of progress in Brexit
negotiations. Finally, the rupee ended at 73.47, 44 paise weaker from its
previous close of 73.03 on Wednesday.
The FIIs as per Thursday's data
were net buyers in equity, while they were net sellers in debt segment. In
equity segment, the gross buying was of Rs 7013.95 crore against gross selling
of Rs 5786.24 crore, while in the debt segment, the gross purchase was of Rs
972.55 crore with gross sales of Rs 1396.79 crore. Besides, in the hybrid
segment, the gross buying was of Rs 2.89 crore against gross selling of Rs 8.05
crore.
The US markets settled lower on
Thursday as investors dumped the high-flying technology sector. Asian markets
are trading in red on Friday tracking sharp declines on Wall Street overnight.
Indian markets ended flat on Thursday after banks slip in-trade, dragged by
index heavyweights like ICICI Bank, Kotak Mahindra Bank and HDFC while IT
stocks capped losses. Today, the start of session is likely to be gap-down
following sell-off in the global markets. Traders will be concerned with ICRA's
report that corporate revenues declined by 31 per cent in the June quarter, but
profit margins decreased by a lesser degree to 3.6 per cent in the April-June
period. Rising coronavirus cases is also likely to impact the markets. India
has recorded its highest-ever single-day spike in new coronavirus cases, of
over 84,000. The total now stands at 3,933,124. Investors will be looking ahead
to the 15th Finance Commission meet, which is likely to meet today, to discuss
the dwindling economic growth, tax collection, GST compensation to states,
revenue deficit grant and fiscal consolidation. Though, some respite may come
later in the day as Prime Minister Narendra Modi invited US companies to invest
in India by taking advantage of its stable tax regime and attractive Foreign
Direct Investment (FDI) policies. Traders may take note of report that Union
Finance Nirmala Sitharaman has asked banks and NBFCs to support borrowers and
that COVID-19 related distress must not impact the lenders' assessment of their
creditworthiness. There will be some buzz in the banking stocks as Fitch
Ratings said private sector banks, with stronger loss-absorption buffers, are
likely to gain market share from their state-owned peers in the medium term.
there will be some reaction in jewellery industry related stocks with the Gem
and Jewellery Export Promotion Council's (GJEPC) statement that gems and
jewellery exports are projected to decline by 25-30 per cent in the current
fiscal as there was a complete washout of the first quarter due to lockdown to
curb spreading of the COVID-19.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,527.45
|
11,495.09
|
11,572.39
|
BSE Sensex
|
38,990.94
|
38,877.46
|
39,170.39
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Motors
|
1,101.57
|
151.85
|
149.20
|
154.85
|
Zee Entertainment
Enterprises
|
530.33
|
220.25
|
214.91
|
225.46
|
Bharti Infratel
|
495.49
|
218.50
|
203.30
|
227.55
|
State Bank of India
|
385.96
|
213.15
|
210.89
|
216.84
|
ICICI Bank
|
261.36
|
382.75
|
378.35
|
389.85
|
TVS Motor Company has further invested a sum Rs 30 crore in Compulsorily Convertible Cumulative Preference Shares of UAPL.
ICICI Bank has launched Home Utsav, a virtual property exhibition that digitally showcases real estate projects by renowned developers from key cities across the country.
Dr. Reddy's Laboratories has launched Methylphenidate Hydrochloride Extended-Release Tablets USP, 18 mg, 27 mg, 36 mg and 54 mg.
Bharat Petroleum Corporation has launched the country's first certified reference material for testing chemical components of crude oils.