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NSE Intra-day chart (08 May 2019)
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Market Commentary 09 May 2019
Benchmarks to make a weak start on sluggish global cues


Indian equity benchmarks extended their sluggish run on Wednesday, with the both larger peers, the Sensex and the Nifty plunging over a percent each, on the back of weak cues from global markets. After a negative start of the day, key indices remained under the grip of bears throughout the day, as US Commerce Secretary Wilbur Ross warned that any retaliatory tariff by India in response to the United States' planned withdrawal of trade privileges will not be appropriate under WTO rules. India has raised the prospect of higher import duties on more than 20 US goods if US President Donald Trump presses ahead with a plan announced in March to end the Generalized System of Preferences (GSP) for India. India is the biggest beneficiary of GSP, which allows preferential duty-free imports of up to $5.6 billion from the South Asian nation.  Markets saw further fall in the last leg of the trade and ended near their intraday low points. Domestic sentiments got hit, amid reports that direct Tax collections fell short by Rs 82,000 crore at Rs 11.18 lakh crore during 2018-19 with lower corporate tax collections emerging as one of the reasons for the lower mop. The government had set a target of Rs 12 lakh crore. The markets participants were pessimistic, as US Labour Secretary Alexander Acosta told US lawmakers that the Trump administration is proposing a hike in the H-1B visa application fee to raise funds for the expansion of an apprentice programme which trains American youth for technology sector jobs. The street paid no heed towards a private report that the number of business-to-business (B2B) startups jumped four times to 3,200 in 2018 from 800 in 2014, enabling faster growth of the ecosystem, attracting investments worth $3.7 billion from $797 million, during the period. Finally, the BSE Sensex slipped 487.50 points or 1.27% to 37,789.13, while the CNX Nifty was down by 138.45 points or 1.20% to 11,359.45.


The US markets ended mostly lower on Wednesday as worries over US-China trade talks lingered. A notice in the Federal Register formally laid the groundwork to raise tariffs on $200 billion of Chinese imports to 25% from 10% early Friday, following through on remarks Monday by US Trade Representative Robert Lighthizer regarding such a move. The prospect of higher tariffs was first raised Sunday by President Donald Trump, rattling investors who had anticipated better progress toward a near-term resolution. Trump once again weighed in on the negotiations, saying that the Chinese are now coming to the US to make a deal, implying they had previously been slow-walking the negotiations in the hope that Trump would be voted out of office in 2020. Meanwhile, Beijing has said top trade envoys, including Vice Premier Liu He, will head to Washington on Thursday to resume negotiations. China's diplomatic contingent had attempted to revamp a nearly 150-page draft trade agreement, as they were reluctant to agree to signing new trade terms into law, raising the ire of US negotiators. Besides,  adding to policy uncertainty, Iran said it may cease compliance with portions of a 2015 nuclear deal it signed with the US, Britain, France, Germany, China and Russia. Iranian President Hassan Rouhani said that it would begin stockpiling heavy water and low-enriched uranium unless non-US signatories take steps to shield the Iranian economy from Trump-administration sanctions that have been crippling its economy. Nasdaq declined 20.44 points or 0.26 percent to 7943.32 and S&P 500 was down by 4.63 points or 0.16 percent to 2879.42, while Dow Jones Industrial Average added 2.24 points or 0.01 percent to 25967.33.


Crude oil futures ended higher on Wednesday as US crude supplies registered a larger-than-expected decline and as growing tensions between the US and Iran raised the threat of disruptions to supplies in the Middle East. The Energy Information Administration (EIA) reported that US crude supplies declined by 4 million barrels for the week ended May 3. That was bigger than the fall of 2.2 million barrels expected by S&P Global Platts, though the American Petroleum Institute on Tuesday had reported an increase of 2.8 million barrels. The EIA data also showed that gasoline inventories were down 600,000 barrels, while distillate stockpiles edged lower by 200,000 barrels last week.  Benchmark crude oil futures for June surged 72 cents or 1.2 percent to settle at $62.12 a barrel on the New York Mercantile Exchange. July Brent crude gained 49 cents or 0.7 percent to settle at $70.37 a barrel on London's Intercontinental Exchange.


Indian rupee ended considerably weaker against the US dollar on Wednesday, as the US-China trade related concerns weighed on investor community. Heavy selling in domestic equities and rising crude oil prices also kept pressure on the Indian rupee. Investors remained concerned with reports that direct Tax collections fell short by Rs 82,000 crore at Rs 11.18 lakh crore during 2018-19 with lower corporate tax collections emerging as one of the reasons for the lower mop. The government had set a target of Rs 12 lakh crore. Dollar weakened against some currencies overseas failed to cast any impact on the rupee. On the global front, dollar weakened across the board on Wednesday as growing concerns about the escalating trade dispute between China and the United States prompted investors to raise their expectations of a U.S. rate cut later in the year. Finally, the rupee ended at 69.71, 28 paise weaker from its previous close of 69.43 on Tuesday.


The FIIs as per Wednesday'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 8276.84 crore against gross selling of Rs 5466.18 crore, while in the debt segment, the gross purchase was of Rs 613.05 crore with gross sales of Rs 703.47 crore. Besides, in the hybrid segment, the gross buying was of Rs 19.94 crore against gross selling of Rs 17.02 crore.


The US markets settled mostly lower on Wednesday after swinging between gains and losses throughout the session, as investors contended with mixed signals around a potential US-China trade deal. Asian markets traded lower in early deals amid growing concerns about the latest US-China trade talks. Indian equity markets ended lower for the sixth consecutive session on Wednesday amid across-the-board selling and weak global cues. Today, the start is likely to remain weak on sluggish global cues. Traders will remain concern on report that continuing to voice concerns over populist measures, the Reserve Bank of India (RBI) has warned that income support schemes and farm loan waivers would lead to fiscal slippages for the states. The RBI listed out specific factors that would drive fiscal slippages in the revised estimates of 2018-19, including farm loan waivers and income support schemes. There will be some cautiousness too with former Finance Minister P Chidambaram's statement that macro economic indicators confirm that the Indian economy has entered a disastrous phase of slowdown. He further added the Finance Ministry's report is a damning indictment of the state of the economy in the country. This is perhaps the weakest point in the economy, adding the next government has a lot of work to repair the economy to which the BJP has done great damage. Meanwhile, the technical report of the National Sample Survey Office (NSSO) has generated controversy following its observation that as much as 36 per cent units forming part of MCA-21 database, used in computing GDP, could not be either identifiable or traceable in the field.  However,  some respite can come later in the day on report that India is expecting improvement in its ranking in the World Bank's doing business report this year particularly in indicators such as paying taxes and trading across borders. In its annual Doing Business report, the World Bank ranks nations based on 10 parameters relating to starting and doing business in a country.  These parameters include ease of starting a business, construction permits, getting electricity, getting credit, paying taxes, trade across borders, enforcing contracts and resolving insolvency.  The banking sector stocks will be in action after ICRA said that financial creditors would realise more than Rs 80,000 crore in this financial year from the Insolvency and Bankruptcy Code (IBC) mainly driven by two large accounts Essar Steel and Bhushan Steel and Power.  This is 21% higher compared to about Rs 66,000 crore realised in the last financial year. Both Essar Steel and Bhushan Steel and Power are part of the RBI's list of the 12 largest defaulting companies announced in June 2017. There will be some buzz in the Aviation stocks as the International Air Transport Association (IATA) stated that the growth of India's domestic passenger market fell to 3.1% in March as compared to 8.3% in February as there was reduction in flight operations of Jet Airways and disruptions at Mumbai airport due to construction.


Support and Resistance: NSE (Nifty) and BSE (Sensex)



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Nifty Top volumes




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Yes bank





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  • Yes Bank has acquired eight crore shares in CG Power and Industrial Solutions which were pledged to it by a borrower.
  •  Bajaj Finance has reached out to 18.6 million customers pan India through the ‘Bijli on EMI' campaign and has been successful in penetrating in tier 1 and tier 2 cities along with the metros.
  •  Coal India's coal allocation under spot e-auction scheme has declined by 37.7 per cent to 34.34 million tonnes in 2018-19.
  •  Vedanta has reported a fall of 43.30% in its consolidated net profit at Rs 3218 crore for Q4FY19 as compared to Rs 5,675 crore for Q4FY18.


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