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NSE Intra-day chart (08 August 2019)
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Market Commentary 09 August 2019
Benchmarks to make a positive start amid firm global cues


Bulls roared back over Dalal Street on Thursday, with Sensex & Nifty gaining over 630 & 175 points, respectively, after reports said the government was looking to roll-back the recently imposed higher tax on the foreign portfolio investors (FPIs). After a firm start of the day, key indices remained in green for the most part of the session, as the India Meteorological Department showed that India received 28% more rainfall than the 50-year average in the week to August 7, easing concerns of drought. Monsoon rains are crucial for farm output & economic growth, as agriculture forms about 15% of India's $2.5-trillion economy. The street overlooked Reserve Bank of India's (RBI) report that consumer confidence declined in July as reflected in the current situation index; the future expectations index fell by about 4 points. Markets extended gains in the last leg of the trade, as RBI announced two key measures to help non-bank financial companies (NBFCs) which are facing a severe liquidity squeeze. The first is harmonisation of single counterparty exposure limit for banks' exposure to single NBFCs with the general single counterparty exposure limit. The central bank has decided to raise a bank's exposure limit to a single NBFC to 20 per cent of tier-I capital of the bank. The second initiative deals with credit to the priority sector. The street also took a note of EEPC India chairman, Ravi Sehgal's statement that the central bank should ensure easy credit disbursal to exporters, especially in the MSME sector. Finally, the BSE Sensex gained 636.86 points or 1.74% to 37,327.36, while the CNX Nifty was up by 176.95 points or 1.63% to 11,032.45.


The US markets end higher on Thursday as government bond yields rebounded from the previous day's slide following upbeat trade data out of China. Yields and bond prices move in opposite directions. The rally on markets also reflected as jitters over a potential trade and currency clash between Beijing and Washington gave way to greed for beaten-down assets. On the economic front, with a drop in inventories of non-durable goods offsetting an increase in inventories of durable goods, the Commerce Department released a report showing wholesale inventories in the US were unchanged in the month of June. The Commerce Department said wholesale inventories were virtually unchanged in June after climbing by 0.4 percent in May. The report said inventories of durable goods rose by 0.3 percent for the second straight month amid jumps in inventories of computer equipment and furniture. Besides, first-time claims for US unemployment benefits unexpectedly showed a modest decrease in the week ended August 3, according to a report released by the Labor Department. The report said initial jobless claims dipped to 209,000, a decrease of 8,000 from the previous week's revised level of 217,000. Meanwhile, the Labor Department said the less volatile four-week moving average crept up to 212,250, an increase of 250 from the previous week's revised average of 212,000. Continuing claims, a reading on the number of people receiving ongoing unemployment assistance, fell by 15,000 to 1.684 million in the week ended July 27. Dow Jones Industrial Average rose 371.12 points or 1.43 percent to 26378.19, Nasdaq surged 176.33 points or 2.24 percent to 8039.16 and S&P 500 was up by 54.11 points or 1.88 percent to 2938.09.


Crude oil futures, which dropped into a bear market this week, reclaimed some of their steep loss on Thursday, tracking gains for global stock markets as upbeat report emerged from China. US stock indexes advanced after China fixed its onshore currency at a level that was higher than expected and as trade data out of the world's second-largest economy was more upbeat, helping to stabilize jittery global markets for now. West Texas Intermediate (WTI) remains off roughly 21% from its 2019 settlement high of $66.30 hit on April 23, which by most measures, is a return to bear-market territory. Brent has fallen about 23% since the late-April high-water mark. Benchmark crude oil futures for September surged $1.45 or 2.8 percent to settle at $52.54 a barrel on the New York Mercantile Exchange. October Brent gained $1.15 or 2 percent to settle at $57.38 a barrel on London's Intercontinental Exchange.


Reversing its five-session fall, Indian rupee bounced back to end higher against the US currency on Thursday, on persistent selling of the American currency by exporters. Sentiments turned optimistic with the India Meteorological Department (IMD) data showing that India received 28% more rainfall than the 50-year average in the week to August 7, easing concerns of drought. Monsoon rains are crucial for farm output and economic growth, as agriculture forms about 15% of India's $2.5-trillion economy. A spectacular relief rally in local equities also supported the forex sentiment. On the global front, dollar steadied on Thursday as risk sentiment rose after resilient Chinese trade data and as Beijing's efforts to slow a slide in the value of the renminbi encouraged investors to buy riskier currencies. Finally, the rupee ended at 70.69, 20 paise stronger from its previous close of 70.89 on Wednesday.


The FIIs as per Thursday'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 5338.19 crore against gross selling of Rs 5849.97 crore, while in the debt segment, the gross purchase was of Rs 2117.11 crore with gross sales of Rs 1029.65 crore. Besides, in the hybrid segment, the gross buying was of Rs 1.34 crore against gross selling of Rs 2.07 crore.


The US markets rose on Thursday as global bond yields rebounded. Asian markets are trading in green on Friday, helped by China's better-than-expected export figures but fresh concerns about Sino-US trade ties capped the gains. Indian markets ended higher with gains of over one and half a percent each on Thursday mainly on the back of late hour buying led by IT and auto stocks along with a rise in global stock markets. Today, the markets are likely to continue jubilation with positive start tracking firm global cues and reports that the government is likely to withdraw higher surcharge on foreign portfolio investors (FPIs). In a bid to ease the concern of FPIs over the increased surcharge announced in the Budget, the Finance Ministry is considering grandfathering the income earned by them up to the Budget (July). Under the proposal, FPIs that are so far structured as trusts will not have to pay the increased surcharge. But if they don't change their structure, they will have to pay the surcharge from the set date. Besides, investors will also be looking ahead to the Index of Industrial Production (IIP) release later in the day. Traders may take note of report that India Inc demanded a stimulus package of over Rs 1 lakh crore to kick-start investment cycle and revive the economy which is showing signs of a slowdown. Meanwhile, to help startups to move from the Innovators Growth Platform of stock exchanges to the mainboard for regular trading, regulator Sebi is planning a new set of norms to allow them to shift after one year of trading and expanding their shareholder base to at least 200. However, there may be some cautiousness with India Ratings' report that the massive Rs 3 trillion capital infusion by the government into state-run banks over the past six years has helped them reduce losses but has failed to boost credit growth. There will be some reaction in auto stocks with report that the Centre gave nod to 5,595 electric buses (e-buses) for inter- and intra-city transportation in 64 cities, giving a thrust to last-mile connectivity and continued electric mobility push. There will be some buzz in the aviation stocks with the International Air Transport Association's (IATA) data showing that India's domestic air passenger traffic rose 7.9 percent in June over the year ago period even as the average demand for domestic travel across seven major aviation markets declined in the reporting month to 4.4 percent from 4.7 percent earlier. There will be some reaction in power stocks with Power Minister R K Singh's statement that in a bid to encourage domestic manufacturing, India will increase import duty on solar equipment down the value chain in the coming years.


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



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Tata Motors










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  • Infosys' subsidiary -- EdgeVerve Systems has launched AssistEdge RPA 18.0 which aims to fundamentally transform process automation by fostering a new human-digital workforce. 
  • M&M is planning to bring out at least three more e-four wheelers in another two and half year. 
  • Maruti Suzuki India has reduced its production in July by 25.15%, for the sixth month in a row. 
  • Wipro has partnered with Camunda to Offer Workflow Automation Platform.
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