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NSE Intra-day chart (09 February 2017)
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Market Commentary 10 February 2017
Markets to make a green start on jubilant global cues

After trading on a feeble note for most part of the session, Indian benchmark indices managed to negotiate a close in the green terrain, as investors showed renewed buying interests in information technology, Consumer Durables and Realty counters. Investors got some comfort with RBI governor's statement that there is further scope for banks to reduce lending rates as the Reserve Bank has already brought down its policy rates by 175 basis points since January 2015. Some support also came with Economic Affairs Secretary Shaktikanta Das' statement that India will be able to pull off a 7% plus growth rate next fiscal as the Budget for 2017-18 has come up with several measures to provide a fillip to various sectors. Further, rejecting arguments that fiscal deficit target of 3.2% is optimistic, he said it is realistic and there is all possibility that revenues will exceed the target, as Budget has not taken into account the demonetisation windfall. However, gains remained capped on report that foreign portfolio investors (FPIs) sold shares worth a net Rs 127.69 crore on February 08, 2017. Adding the anxiety among market participants, RBI's bi-monthly survey on consumer confidence indicate that Indian households are less confident of their current economic situation as people are uncertain about their immediate income, employment and spending capabilities. Meanwhile, banking stocks declined as RBI held repo rates at 6.25% for the second time in a row, changing its stance to 'neutral' from 'accommodative'. On the other hand, IT stocks gained traction as global IT major Cognizant has guided for a revenue growth of $3.51 billion to $3.55 billion for March quarter. The company expects March quarter non-GAAP diluted EPS to be at least $0.83 per share. Finally, the BSE Sensex gained 39.78 points or 0.14% to 28329.70, while the CNX Nifty was up by 9.35 points or 0.11% to 8,778.40. 


The US markets closed higher on Thursday, with all the major indexes notching the latest in a series of record closes, with energy and financial stocks leading the way. The stocks climbed after Trump referenced a phenomenal announcement about his tax plan coming in the next few weeks. Trump said that we're going to announce something I would say over the next two or three weeks that will be phenomenal in terms of tax. The last time all three major indexes simultaneously closed at records was January 25. On the economy front, the number of Americans who applied for unemployment benefits in early February fell by 12,000 to 234,000, hitting the second-lowest level of an economic recovery that began nearly eight years ago. New jobless claims have registered less than 300,000 for 101 straight weeks, the longest streak in more than four decades. The record low for new claims during the current expansion was 233,000 in early November. Similarly, the less volatile four-week average of initial claims dropped by 3,750 and stood at 244,250, touching the lowest level in 44 years. The Dow Jones Industrial Average added 118.06 points or 0.59 percent to 20,172.40, the Nasdaq was up 32.73 points or 0.58 percent to 5,715.18, while S&P 500 gained 13.2 points or 0.58 percent to 2,307.87. 


Crude oil futures surged on Thursday after Energy Information Administration (EIA) boosted its 2018 U.S. crude production forecast. Also there was report that ten OPEC members have achieved 91% compliance toward supply quotas. Traders were also encouraged with an unexpected draw in U.S. gasoline inventories pointing to higher demand in the world's biggest oil market. The fall in gasoline stocks suggested U.S. consumption was stronger than expected, and may be healthy enough to support prices at time when most fuel oil markets are very well stocked. Benchmark crude oil futures for March delivery gained $0.66 or 1.3 percent to $53 on the New York Mercantile Exchange. In London, Brent crude for March delivery ended higher by $0.60 or 1.14 percent at $55.72 on the ICE.


Indian rupee ended at three-month high against dollar on Thursday extending its winning streak for second straight session on continued dollar selling by banks and exporters. Some support also came with reports that Indian economy attracted $4.68 billion Foreign Direct Investment (FDI) in November 2016, up 60 percent over the corresponding period last year of $2.93 billion. The domestic currency looked strong from the very beginning but losses in the equity market capped some rupee gains. On the global front, dollar managed to stabilise on Thursday after the previous session's slide, although lingering risk aversion pinned Treasury yields near multi-week lows and restrained the greenback's bounce.  Finally, the rupee ended at 66.85, 57 paise stronger from its previous close of 67.42 on Wednesday.


The FIIs as per Thursday's data were net sellers in equity and debt segments both. In equity segment, the gross buying was of Rs 4468.40 crore against gross selling of Rs 4656.66 crore, while in the debt segment, the gross purchase was of Rs 1560.80 crore with gross sales of Rs 2235.08 crore.


The US markets surged in last session to record highs after showing a lack of direction in the past few sessions, mainly due to comments from US President to announce a plan to lower the tax burden on American business. The Asian markets taking cues from the US markets have made a positive start led by the Japanese market, which is up by over two percent with the gain in dollar. Higher crude oil prices also boosted investor sentiment in the region. The Indian markets managed a modestly positive close in last session after much of dilly-dallying, with IT stocks witnessing buying after suffering steep losses in last few sessions. Today, the start is likely to be in green on strong global cues. Traders will also be getting some support with a US think tank report stating that India will be the world's fastest growing economy during the next five years as China's economy cools and growth elsewhere sputters, but internal tensions over inequality and religion will complicate its expansion. Meanwhile, Finance Minister Arun Jaitley has warned that economies will become more inefficient and GDP will shrink if protectionist trend emerges in developed economies. Traders will be eyeing the December IIP data due to be announced later in the day. The IT pack may continue their gains on government's statement that it is engaged with the Donald Trump administration as well as members of the US Congress on concerns regarding the H1B visa issue. There will be lots of lots of important result announcements to keep the markets ticking.


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  • Tata Power Delhi Distribution, a joint venture of Tata Power and the Government of Delhi, has launched energy-efficient LED lighting and ceiling fans in association with Energy Efficiency Services under the UJALA scheme for its customers.
  • Cipla has reported 43.85% rise in its consolidated net profit after tax, minority interest and share of profit / (Loss) of associates at Rs 374.83 crore for the quarter ended December 31, 2016, as compared to Rs 260.57 crore for the same quarter in the previous year.
  • Hero MotoCorp has reported 2.56% fall in its net profit at Rs 772.05 crore for the quarter ended December 31, 2016, as compared to Rs 792.30 crore for the same quarter in the previous year.
  • Taro Pharmaceutical Industries, the US subsidiary of Sun Pharmaceuticals Industries, has reportedly received tentative approval from the US FDA for diclofenac sodium topical solution of 2 per cent strength.
  • Lupin has reported 20.69% rise in its net profit after taxes and non-controlling interest at Rs 633.11 crore for the quarter ended December 31, 2016, as compared to Rs 524.56 crore for the same quarter in the previous year. 
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