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NSE Intra-day chart (06 March 2017)
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Market Commentary 07 March 2017
Markets to get a mildly positive start

Indian markets have kicked off the week on a confident note, with the NSE index moving close to breaching a key psychological level of 9,000, while Sensex reclaimed 29,000-mark on Monday. Sentiments got a boost with the GST council moving a step closer towards implementing the goods and services tax (GST) from 1 July, approving two crucial supporting legislations of central GST law (CGST) and the integrated GST (IGST) law for this ambitious tax reform. It will again meet on 16 March to clear the state GST law (SGST) and the union territory GST law (UTGST). Once all the bills are passed by the council, the Union government will collectively take the bills to the Union cabinet for its approval. Some support also came with the report that foreign investments in the services sector increased 77.6 percent to $7.55 billion in the first nine months of the current fiscal, helped by government steps to improve ease of doing business. However, gains remained capped on rising geopolitical tensions in East Asia, as North Korea fired four ballistic missiles early in the day, while a spat between China and South Korea over missile defence deepened. Meanwhile, Information technology (IT) stocks came under pressure on Monday, following the developments on H1-B visa front in the US. The United States announced that from April 3 it would temporarily suspend the ‘premium processing' of H-1B visas that allowed some companies to jump the queue as part of its efforts to clear the backlog. Finally, the BSE Sensex surged 215.74 points or 0.75% to 29048.19, while the CNX Nifty was up by 65.90 points or 0.74% to 8,963.45.


The US markets closed lower on Monday, amid concerns over growing geopolitical tensions. The downturn for stocks comes as North Korea tested four ballistic missiles off its east coast early Monday, Seoul time. President Donald Trump has accused that his predecessor, Barack Obama, wiretapped him. Some investors worried that the accusation could distract Trump from his economic agenda of introducing tax cuts and simplifying regulations, which have powered a record-setting rally on Wall Street since the election. The market is still digesting Federal Reserve Chairwoman Janet Yellen's clearest indication to date that a March rate increase is a real possibility next week. On the economy front, the factory orders climbed up by 1.2% in January. The Commerce Department said orders have climbed for 6 of the last 7 months and rose 0.3% when transportation was excluded. Industrial machinery orders climbed up by 6.6%, while photographic equipments orders dropped by 15%. The Dow Jones Industrial Average lost 51.37 points or 0.24 percent to 20,954.34, Nasdaq was down 21.57 points or 0.37 percent to 5,849.18, while S&P 500 dropped 7.81 points or 0.33 percent to 2,375.31.


Crude oil futures once again turned lower on Monday as the dollar firmed versus major currencies. Traders were also concerned with an International Energy Agency (IEA) report which said that OPEC will increase its production capacity as Iran and Iraq ramp up. IEA expects OPEC will raise output capacity by 1.95 million barrels a day from 2016 to 2022. IEA predicted a sharp increase in shale oil growth and a reduction in demand for European refined products. It said that U.S. producers will contribute most of the growth in supplies outside OPEC through to 2022. Benchmark crude oil futures for May delivery was down by $0.13 or 0.2 percent to $53.20 on the New York Mercantile Exchange. In London, Brent crude for May delivery ended up by $0.05 at $55.95 on the ICE.


Indian rupee ended stronger against dollar on Monday, due to increased selling of the American currency by exporters. Sentiments remained up-beat with Minister of State for Petroleum and Natural Gas Dharmendra Pradhan's statement that India's gross domestic product (GDP) will achieve 8% growth and continue its momentum for the next financial year, even after demonetising about 85% of all currency in circulation last November. Some support also came with the report that foreign investments in the services sector increased 77.6 percent to $7.55 billion in the first nine months of the current fiscal, helped by government steps to improve ease of doing business. Besides, good going in the local equity markets and dollar's weakness overseas against a basket of major currencies, mainly aided the currency's appreciation. On the global front, Yen was trading higher in Asian session on risk aversion as North Korea fired four ballistic missiles into nearby waters. Finally, the rupee ended at 66.71, 10 paise stronger from its previous close of 66.81 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 5308.64 crore against gross selling of Rs 3880.73 crore, while in the debt segment, the gross purchase was of Rs 576.41 crore with gross sales of Rs 531.84 crore.


The US markets despite recovering from the day's low ended modestly in red in the last session. Profit taking mainly contributed to the weakness on Wall Street, as some traders cashed in on the recent strength in the markets, although a report showed that new orders for manufactured goods increased in line with expectations in the month of January. The Asian markets have made mostly a green start though there is caution prevailing in the region as investors assessed whether a rally leading up to a near-certain U.S. interest-rate increase has run its course. The Indian markets making a strong start of the new week surged in last session to two-year closing high. Today, the start is likely to be cautious but in green, tailing the regional cues. Meanwhile, RBI Deputy Governor Viral V Acharya has said that demonetisation impact on GDP may be seen in the current quarter in some segments, while the remonetisation exercise should be completed in 2-3 months. He further said that the impact of the notes ban would only be temporary and would help in bringing informal sector into the mainstream economy. There will be some buzz in the oil & gas sector with International Energy Agency (IEA) stating that India is moving to the centre stage of global energy market and by the early 2020s it will replace Russia as the world's third largest refiner. Pharma sector too will be in action on report from ICRA that domestic pharmaceutical industry is likely to register moderate growth largely owing to increased regulatory scrutiny as well as consolidation of supply chain in the US market.


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  • Tata Motors has unveiled its hatchback Tiago with automated manual transmission, priced at Rs 5.39 lakh.
  • HDFC Bank has unveiled an electronic virtual assistant, an artificial intelligence-driven chatbot, for customer services.
  • Cipla has entered into agreements, through its wholly owned subsidiary Inyanga Trading 386 Proprietary (Inyanga), with the group companies of Ascendis Health, South Africa for divesting its animal health business in South Africa and Sub-Saharan Africa.
  • Dr Reddy's Laboratories has acquired 100% stake in Kolkata based, non-banking finance company, Imperial Credit.
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