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NSE Intra-day chart (12 January 2016)
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Market Commentary 13 January 2016
Markets to see some recovery despite weak macro data


The carnage in Indian stock markets prolonged for yet another session as the benchmarks continued to sway to the tune of depressing global developments and deposed another over half percent on Tuesday. Worries about the Beijing's ability to manage financial markets coupled with deepening fears about a protracted slowdown in the world's No 2 economy continue to keep investors on edge after sharp losses over the past week. On the domestic front, sentiments got undermined on report that foreign investors sold shares worth Rs 1,319.24 crore on January 11, 2016. The NSE's 50-share broadly followed index Nifty, plunged by over half a percent to settle above the crucial 7,500 support level while, Bombay Stock Exchange's Sensitive Index Sense deposed over hundred points and closed below the psychological 24,700 mark. Market participants also remained cautious ahead of Index of Industrial Production (IIP) for November and CPI Inflation data to be released later in the day. However, losses remained capped with finance minister Arun Jaitley's statement that India can move to a high-growth trajectory of 10 per cent over the next two years with higher spending on infrastructure and by creating and strengthening banks. Earlier on Dalal Street, the benchmarks got off to a positive start in the morning trade as investors were largely influenced by the supportive leads from Asian markets. However, the bourses failed to capitalize on the early momentum and slipped to lower levels in late morning session on expectation that consumer inflation probably edged up for the fifth straight month in December, driven by higher food prices, complicating the central bank's task of steering monetary policy at a time of international deflation. The selling pressure accentuated in the mid afternoon trades as investors took to across the board risk aversion. Though the bourses recovered from the lows of the day but could not succeed in minimizing the huge losses by the end of trading session. Finally, the BSE Sensex declined by 143.01 points or 0.58% to 24682.03, while the CNX Nifty ended down by 53.55 points or 0.71% to 7,510.30.


The US markets coming out of the consolidation phase of last session posted decent gains on Tuesday. Though, the trade remained volatile throughout the day, as traders continued to keep an eye on developments in China, where authorities made an effort to stabilize the yuan following recent weakness. However, the major averages managed to end the session firmly in positive territory as the crude oil, which turned lower early in the day closed well off its worst levels. A late rebound in energy and biotech shares helped push the S&P 500 to a second straight day of gains on Tuesday, while Apple and other technology shares helped the tech heavy Nasdaq to snap an eight-session losing streak. The Dow Jones Industrial Average gained 117.65 points or 0.72 percent to 16,516.22, the Nasdaq added 47.93 points or 1.03 percent to 4,685.92 and the S&P 500 ended higher by 15.01 points or 0.78 percent to 1,938.68.


Crude oil futures plunged again on Tuesday, though it came well off days low but briefly fell below $30 a barrel for the first time in more than a decade, ahead of the release of the American Petroleum Institute's weekly inventory report. Prices were under pressure, as Saudi Arabia is digging in its heels, refusing to curb production in an effort to cripple non-OPEC competitors. Elsewhere, investors digested news of a suicide bombing in Istanbul on Tuesday morning, of which Turkey officials linked to a group represented by the Islamic State. Benchmark crude oil futures for February delivery settled down by $1 or 3.17 percent to close at $30.41 a barrel after trading in a range of $29.96 and $32.19 a barrel on the New York Mercantile Exchange. In London, Brent oil futures for February delivery declined by $0.97 or 3.04 percent to $30.91a barrel on the ICE.


Indian rupee extending its weakness for second straight day depreciated against dollar on Tuesday on fresh bouts of demand for the American currency from importers and banks, amid volatile domestic equities. Investors turned cautious ahead of the Index of Industrial Production (IIP) data for November and CPI Inflation data scheduled to be released later in the day. On the global front, dollar edged down against yen on Tuesday, drifting towards a 4-month low against the perceived safe-haven yen as crude oil prices continued to tumble. Finally, the rupee ended at 66.87, 6 paise weaker from its previous close of 66.81 on Monday. The currency touched a high and low of 66.9750 and 66.70 respectively.


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 3146.46 crore against gross selling of Rs 4192.26 crore, while in the debt segment, the gross purchase was of Rs 987.39 crore with gross sales of Rs 602.20 crore.    


The US stocks despite a choppy trade closed higher in last session, erasing previous session losses and sensed some relief following mounting investor concerns about declining oil prices and a China-led slowdown in global growth. Asian markets have made a good start tailing positive cues from the US markets. The rally is led by the Japanese markets, which surged around two percent, rising for the first time this year. The Indian markets continued their bearish trend and ended the last session with cut of over half a percent, amid global turmoil. Today, the start is likely to be in green on positive global cues; however there will be some cautiousness from the domestic front, as in a double whammy, the industrial production plunged to an over four-year low, contracting 3.2 percent in November, while retail inflation increased marginally to 5.61 percent in December, mainly on costlier vegetables and cereals. Meanwhile, Finance Ministry has attributed the decline in November industrial production to a four-year low to statistical reasons, particularly due to lesser number of working days due to Diwali and the impact of Chennai floods. Markets are likely to get some support with Paris-based think tank OECD stating that India is witnessing firming economic growth while most of the developed economies are seeing mixed trends. The assessment based on Composite Leading Indicators (CLIs) stated that India's CLI inched up to 100.4 in November from 100.2 in October.  The IT pack is likely to come under pressure, as India's largest IT services company, Tata Consultancy Services (TCS), has put in a lacklustre performance in December quarter. The dollar revenue of the company dropped 0.3% to $4.15 billion, while net profit was flat sequentially at $926 million, impacted by deluge in Chennai.


Support and Resistance: NSE Nifty and BSE Sensex



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Tata Motors






  • Tata Motors' subsidiary Jaguar Land Rover is planning to launch an all-new version of its luxury sedan Jaguar XE in India on February 3, 2016 with two petrol engine options.
  • Larsen & Toubro's construction arm L&T Constructions has won orders worth Rs 1247 crore across various businesses.
  • Indusind Bank has reported a rise of 29.93% in its net profit at Rs 581.02 crore for the quarter under review as compared to Rs 447.19 crore for the same quarter in the previous year.
  • Adani Ports and Special Economic Zone is planning to raise Rs 4,500 crore through long-term debentures.
  • HDFC's arm HDFC Life has set up a wholly-owned subsidiary in the Dubai International Financial Centre called HDFC International Life and Re Company with an initial capital outlay of $12.33 million.
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