Tuesday turned out to be a
disappointing day of trade for Indian equity benchmarks, with Nifty and Sensex
breaching their crucial 10,000 and 32,100 levels, respectively, after
Securities and Exchange Board of India (SEBI) directed bourses to initiate
action against 331 suspected shell companies that are listed and these scrips
will not be available for trading this month. The regulators directive came
after the Corporate Affairs ministry shared a list of 331 listed companies that
are suspected to be shell entities and could even face compulsory delisting.
Markets started the session with optimism but it soon fizzled out and both the
domestic indices entered into red terrain, as traders turned cautious with the
private report stating that it ‘suspects' that there has been a change in the
stance by the authorities to let the rupee appreciate more, but warned that it
can hurt manufacturing and exports. Some concerns also came with Engineering
exporters' body EEPC stating that shipping companies are facing difficulties
post GST as their drawback refunds will not be released till September-end or
October. Meanwhile, the securitisation market has hit a record high of $1.02
trillion in fiscal 2017, helped by a surge in volume of pass-through
certificates (PTCs). Traders failed to get any sense of relief with Central Board of Direct Taxes' (CBDT)
report of a 25 percent increase in the number of Income Tax Returns (ITRs) filed
in the current fiscal, on the backdrop of economic reform, including
demonetisation and the Income Tax Department's (ITD) Operation Clean Money.
Traders also failed to get any solace with SEBI allowing brokers to offer a
margin funding facility that does not mandate clients to bring cash upfront to
initiate a leveraged trade. Investors can now buy shares by pledging their
stock portfolio with stock brokers. Finally, the BSE Sensex declined 259.48
points or 0.80% to 32,014.19, while the CNX Nifty was down by 78.85 points or
0.78% to 9,978.55.
The US markets closed lower on
Tuesday, reversing earlier gains as an early rally in financial, tech and
energy stocks fizzled amid tough talk from President Donald Trump on North
Korea. Trump told that North Korea would be met with fire and fury like the
world has never seen should it continue to threaten the US. That followed
reports earlier in the day that North Korea has successfully miniaturized a
nuclear warhead that could fit inside a missile. On the economy front,
sentiment among small-business owners skyrocketed in July as customer demand
improved, in spite of continued gridlock in Washington. The closely-watched
sentiment gauge from the National Federation of Independent Business rose 1.6
points to 105.2. That snapped a five-month streak of readings that either
declined or remained the same, and easily beat the consensus forecast for a
decline to 103.2. The jump in the July survey reflected better views of the
labor market: owners reported having more open positions now as well as plans
to hire more in the future. The number of job openings rose to a fresh record
in June while hiring decreased, evidence of the difficulties companies are
having finding suitable employees. The Dow Jones Industrial Average lost 33.08
points or 0.15 percent to 22,085.34, the Nasdaq dropped 13.31 points or 0.21
percent to 6,370.46, while the S&P 500 edged lower by 5.99 points or 0.24
percent to 2,474.92.
Crude oil futures extended their
decline on Tuesday, as OPEC gathered to discuss its supply quota plan and as rising
output from major oil producers offset reports that Saudi Arabia is planning to
cut exports to Asia next month. It was reported that Saudi Arabia will cut
crude oil allocations to its customers worldwide in September by at least
520,000 barrels per day, to stem the global crude glut. Also adding to concerns
over the glut in supply, were reports Libya's largest oil field, was returning
to normal after a brief disruption by armed protesters in the coastal city of
Zawiya. Benchmark crude oil futures for September delivery declined by $0.22 or
0.5 percent to $49.17 on the New York Mercantile Exchange. In London, Brent
crude for September delivery ended lower by $0.36 at $52.02 a barrel on the
ICE.
Indian
rupee strengthened against the US dollar on Tuesday, on persistent selling of
the American currency by exporters and banks. Besides, dollar's weakness
against some other currencies overseas supported the rupee sentiment. Some
support also came with Central Board of Direct Taxes' (CBDT) report of a 25
percent increase in the number of Income Tax Returns (ITRs) filed in the
current fiscal, on the backdrop of economic reform, including demonetisation
and the Income Tax Department's (ITD) Operation Clean Money. On the global
front, the dollar inched down slightly in Asian trading on Tuesday, but
maintained most of the gains it made on last week's robust employment data that
kept hope alive that the US Federal Reserve could still increase interest rates
this year. Finally, the rupee ended at 63.63, 17 paise stronger from its
previous close of 63.80 on Monday.
The
FIIs as per Tuesday's data were net sellers in equity segment, while they were
net buyers in debt segment. In equity segment, the gross buying was of Rs
3834.07 crore against gross selling of Rs 4000.39 crore, while in the debt
segment, the gross purchase was of Rs 1826.47 crore with gross sales of Rs
581.85 crore.
The US markets made a mildly
lower closing in the last session that ended the Dow's streak of setting new
record closing highs for nine consecutive sessions. Geopolitical worries mainly
weighed on the sentiments with remarks by President Donald Trump adding to
concerns about rising tensions between the US and North Korea. The Asian
markets have made mostly a lower start tailing the weakness in US markets, as
investors took a risk-off approach after the U.S. and North Korea exchanged
threats amid escalating tensions between the two nations. Japanese market was
down by over a percent as the yen and gold climbed. The Indian markets suffered
sharp sell-off in the last session, after capital market regulator SEBI
directed exchanges to initiate action against 331 suspected shell companies.
Today, the start is likely to remain somber on sluggish global cues and
geopolitical worries will keep mounting pressure on the domestic markets too.
Traders however may get some support with the government statement that job
loss through automation in India should not be a matter of concern as the
"growth momentum" of the economy will result in new job
opportunities. Also, Union Power Minister Piyush Goyal has said that the newly-introduced
Goods and Services Tax (GST) is crucial for promoting transparency and a
corruption-free business environment in the country. Markets will get
additional support with the India Meteorological Department (IMD), setting
stage for a good kharif harvest and strong rural demand stating that monsoon
rainfall is likely to remain normal in the remaining two months of the season.
There will be some buzz in the sugar space, with report that India is planning
to allow additional 200,000 tonnes of duty-free sugar imports, as production
fell below consumption in 2016/17 marketing year ending on Sept 30. There will
be lots of important earnings announcements too, to keep the markets in action
today.
Support and Resistance: NSE
(Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
9978.55
|
9922.43
|
10059.23
|
BSE Sensex
|
32014.19
|
31834.67
|
32274.24
|
Nifty Top volumes
Stock
|
Volume
(in Lacs)
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
Hindalco
|
248.97
|
234.90
|
229.83
|
242.43
|
Tata Steel
|
200.46
|
616.45
|
606.47
|
625.97
|
Vedanta
|
187.78
|
297.70
|
291.83
|
302.63
|
SBI
|
135.79
|
303.65
|
299.30
|
309.90
|
Bharti Infratel
|
128.57
|
383.60
|
379.13
|
388.93
|
Wipro has entered into global partnership with Excelfore to offer secure connectivity solutions for next generation smart and autonomous vehicles.
Bharti Airtel has unveiled a new bonus data offer for its new customers of broadband users under which it is offering as much as 1000 GB extra data.
Tata Steel has reported a consolidated net profit of Rs 921.09 crore for the quarter ended June 30, 2017 as against a net loss of Rs 3183.07 crore for the corresponding quarter in the FY17.
Tata Motors Group global wholesales in July 2017, including Jaguar Land Rover, stood at 98,534 units, higher by 12%, over July 2016.