Tuesday turned out to be a
lackluster day for the Indian equity benchmarks, as both the larger peers
settled with losses, ahead of RBI monetary policy meeting outcome. The markets
made a cautious start and remained in red terrain throughout the day, as Crisil
cut India's growth forecast for current fiscal to 7.4% on the back of weakening
GDP growth and lower global trade forecasts. India's growth in the
July-September quarter slipped to 7.1% from 8.2% in the April-June quarter. It
added that India's export, which saw a revival in early part of 2018, could
likely see a slower growth. Anxiety remained among the traders, amid reports
that the recent move by the US government to change the method of H-1B visa
allotment is a mixed bag for India. It added that while the move is expected to
have a negative impact on the Indian technology services industry. The trade
also remained lackluster with a private report that the 50 percent rise in shadow-banking
loans in October was on account of difficulties in arranging money from money
market alternatives but is unlikely to sustain. However, downside remained
capped, supported by the finance ministry's statement that total Goods and
Services Tax (GST) refunds to the tune of Rs 91,149 crore has been cleared by
the Central Board of Indirect Taxes and Customs (CBIC) and the state
authorities out of the total refund claims of Rs 97,202 crore received so far.
Thus, the disposal rate of 93.77 percent has been achieved. Adding some relief,
Revenue Secretary Ajay Bhushan Pandey said that the new simplified GST return
forms will be rolled out from April 1, 2019. He also exuded confidence that the
government will achieve the budgeted target for GST collection and said the
revenue department is getting inputs about entities which are evading taxes.
Meanwhile, CBDT chairman Sushil Chandra said that income tax return filing for
assessment year 2018-19 has so far seen a 50 per cent rise since last year. He
further said that demonetisation has been very good for increasing the tax base
of the country. This year, we have already got around 6.08 crore income tax
returns, which is 50 percent higher than last year by this particular date.
Finally, the BSE Sensex plunged 106.69 points or 0.29% to 36,134.31, while the
CNX Nifty was down by 14.25 points or 0.13% to 10,869.50.
After gaining in the previous
session, the US markets ended lower with cut of over three percent on Tuesday,
with the Dow Jones Industrial Average dropping by almost 800 points, as
investors worried that a US-China trade truce reached over the weekend was not
all it was cracked up to be. Doubts surrounding the US and China's ability to
achieve a concrete deal to avoid new, or expanded, bilateral tariffs are
rising, as investors focused on the lack of specific concessions made by China
at last weekend's G-20 meeting in Argentina, where President Donald Trump and
Chinese President Xi Jinping met. Meanwhile, confusion spread when exactly the
90-day timeline would begin, after White House economic adviser Larry Kudlow
mistakenly stated that the negotiating window would begin on January 1, 2019.
The White House later put out a correction, stating that it began on December
1. Besides, sentiments were down beat as the yield on two-year notes rose above
the yield on five-year notes, which is seen as an indicator of an upcoming
economic slowdown. Moreover, profit taking contributed to the sell-off
following the strong gains posted on Monday. The markets will be closed
Wednesday as the nation stops to mourn former President George H.W. Bush, who
died Friday at 94. Dow Jones Industrial Average dropped 799.36 points or 3.10
percent to 25027.07, S&P 500 plunged 90.31 points or 3.24 percent to
2700.06 and Nasdaq was down by 283.09 points or 3.80 percent to 7158.43.
Crude oil futures once again
ended higher on Tuesday as traders continued to weigh the likelihood of an
output-cut agreement later this week between major oil producers. That
expectation was strengthened after Russian President Vladimir Putin said over
the weekend that he and Saudi Crown Prince Mohammed bin Salman agreed to extend
reductions while meeting on the sidelines of the G-20 summit. However, up-move
remain capped on private report that the American Petroleum Institute (API)
reported that US crude supplies rose by 5.4 million barrels for the week ended
November 30. The API data also showed stockpile increases of 3.6 million
barrels in gasoline and 4.3 million barrels in distillates. Benchmark crude oil
futures for January gained 30 cents or 0.6 percent to settle $53.25 a barrel on
the New York Mercantile Exchange. February Brent crude added 39 cents or 0.6
percent to settle at $62.08 a barrel on London's Intercontinental Exchange.
In line
with a minor fall in local equities, Indian rupee ended marginally weaker
against the American currency on Tuesday, due to fresh dollar demand from banks
and importers. Traders remained concerned with Crisil cutting India's growth
forecast for current fiscal to 7.4% on the back of weakening GDP growth and
lower global trade forecasts. India's growth in the July-September quarter
slipped to 7.1% from 8.2% in the April-June quarter. It added that India's
export, which saw a revival in early part of 2018, could likely see a slower
growth. Some cautiousness also came with ICRA's statement that India's current
account deficit is likely to rise to 3% of GDP in the July-September quarter of
current fiscal, from 2.4% in the preceding quarter, driven mainly by high crude
oil prices. On the global front, dollar weakened in Asia on Tuesday as US
Treasury yields fell to three-month lows, with investors fretting over a
possible pause in the Federal Reserve's rate-hike cycle and portents of
recession seen in a yield curve inversion. Finally, the rupee ended at 70.49, 4
paise weaker from its previous close of 70.46 on Monday.
The FIIs as per Tuesday's data
were net buyers in equity segment, while they were net sellers in debt segment.
In equity segment, the gross buying was of Rs 5214.91 crore against gross
selling of Rs 5052.88 crore, while in the debt segment, the gross purchase was
of Rs 798.29 crore with gross sales of Rs 2339.16 crore. Besides, in the hybrid
segment, the gross buying was of Rs 1.24 crore against gross selling of Rs 0.36
crore.
The US markets ended sharply
lower on Tuesday, a biggest decline since the October rout, as investors
worried about a bond-market phenomenon signaling a possible economic slowdown
coupled with lingering worries around US-China trade. Asian markets are trading
in red in early deals on Wednesday after an overnight plunge on Wall Street as
investors worried about a potential economic slowdown and the state of the
US-China trade war. Indian markets snapped six-session winning streak to settle
in red territory on Tuesday as cautious investors weighed a host of factors
like depreciating rupee, rising crude prices and weak global cues. Uncertainty
over the longevity of recently enforced US-China trade truce also impacted
sentiments. Today, the markets are likely to make pessimistic start tacking
weak global cues. Investors will also be cautious ahead of the fifth Reserve
Bank of India (RBI) Monetary Policy Committee meeting. According to reports,
the RBI will keep its repo rate unchanged at 6.50% in the upcoming policy.
Moreover, Investors will be eyeing Services PMI data for the month of November
to be out later in the day. There will be some cautiousness with Niti Aayog
Vice Chairman Rajiv Kumar's statement that the country's economy is likely to
bounce back during the fourth quarter at a faster rate to match the overall
projection for the current fiscal, but, he added that the economy is unlikely
to recover in the third quarter from the slow pace during the last quarter.
However, traders may take some support later in the day with Engineering Export
Promotion Council's (EEPC) statement that India's engineering exports are
likely to touch $80 billion this fiscal on account of healthy growth in key
markets, including the US and Europe. Traders may also react to the Central
Board of Direct Taxes chairman Sushil Chandra's statement that demonetisation
led to an increase in the country's tax base, with income-tax filings jumping
by as much as 50% over the previous year. He said the government will achieve
its direct tax collection target of Rs 11.5 lakh crore in the current financial
year. Traders may take note of report that a high-level panel recommended
market regulator SEBI to allow direct listing of Indian companies on overseas
bourses and of foreign firms on Indian exchanges. Currently, Indian companies
can list their shares through depository receipts abroad, while foreign
companies need to go through the Indian Depository Receipt route for listing of
equities. Meanwhile, India and the United Arab Emirates signed a currency swap
agreement to boost investment and enable direct trade without using dollars or
other international currencies. There will be some buzz in telecom sector
stocks with ICRA's report that the much-anticipated recovery in the telecom
sector, backed by restoration of pricing power, may be delayed because intense
competition is likely to persist. It added that the recent rupee depreciation
and higher diesel prices are likely to have further hurt India's telecom
industry.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,869.50
|
10,838.25
|
10,895.85
|
BSE Sensex
|
36,134.31
|
36,015.19
|
36,274.64
|
Nifty Top volumes
Stock
|
Volume
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
680.39
|
176.50
|
173.68
|
180.88
|
Sun Pharma
|
362.34
|
442.90
|
434.73
|
457.88
|
ICICI Bank
|
186.51
|
357.95
|
354.47
|
360.27
|
Indiabulls Housing
Finance
|
149.07
|
803.70
|
780.23
|
822.58
|
SBI
|
118.97
|
282.55
|
280.32
|
286.37
|
Yes Bank's wholly owned subsidiary -- Yes Asset Management India has received the SEBI's approval to launch Yes Liquid Fund and Yes Ultra Short Term Fund.
Tata Motors' wholly owned subsidiary -- JLR has launched a special edition of its Jaguar XJ model for Rs 1.11 crore in India to celebrate 50 years of the company's flagship luxury saloon.
HCL Technologies has expanded its strategic relationship with Barclays.
TCS has launched its intelligent power plant solution, TCS IP2, to help power generating utilities digitally transform their operations and gain a competitive edge in the dynamic power market.