In a highly volatile session,
Indian stock markets climbed off the day's high but ended with decent gains on
Monday, tracking positive Asian shares. Both the topline indices had opened
nearly one percent higher and progressed further during the early morning
trade, as traders took encouragement with RBI Governor Shaktikanta Das'
statement that the Indian economy has started showing signs of normalcy with
ease in lockdown restrictions across the country. He added that post
containment of COVID-19, a very careful trajectory has to be followed in
orderly unwinding of countercyclical regulatory measures. Traders took note of
the International Monetary Fund's (IMF) statement that given the severity of the
country's economic situation due to the COVID-19 pandemic, there is a scope for
more near term fiscal support in India, especially for vulnerable households
and SMEs. However, in the afternoon session of trade, the indices pared their
gains and briefly turned negative, as traders got anxious with Industry body
FICCI's Survey in which it has projected India's annual median GDP growth for
FY21 at (-) 4.5 percent. It said with the rapid spread of COVID-19 pandemic
manifesting into an economic and healthcare crisis globally, the latest
forecast marks a sharp downward revision from the growth estimate of 5.5 per
cent reported in the January 2020 survey. Some pessimism also came as the
finance ministry has written to the states on additional borrowing of 2 per cent
of their projected GSDP in the current financial year, amid stress in revenue
due to coronavirus-induced lockdown. But, key gauges picked up some steam and
ended with gains, as some optimism remained among traders with agriculture
ministry's statement that the government is on track to achieving the target of
doubling farmers' income by 2024 and recent farm reforms, including setting up
of a Rs 1 trillion agri-infra fund, are steps in that direction. Finally, the
BSE Sensex rose 99.36 points or 0.27% to 36,693.69, while the CNX Nifty was up
by 34.65 points or 0.32% to 10802.70.
The US markets ended mostly lower
on Monday after technology stocks fell and rising coronavirus cases led
California's governor Gavin Newsom to order businesses across the state to
shutter once again. Newsom ordered a statewide closure of all indoor operations
at restaurants, bars, movie theaters, zoos and museums, with other businesses
like gyms and hair salons being required to close their doors in counties on
the state's watch list. Meanwhile, New York Gov. Andrew Cuomo also issued an
emergency health order that requires all travelers to New York from high-COVID
states to provide location details or face a summons and $2.000 fine, while
also outlining a formula to reopen New York schools in the fall that will
require infection rates to be below 5% based on 14-day averages. Besides,
investors have been keeping an eye on threats of renewed US-China tensions.
President Donald Trump said there was no scope for a phase-two agreement on
trade between the two countries, saying Washington's relationship with China
had been severely damaged by the coronavirus pandemic, which the administration
has sought to blame on Beijing. China's move to crack down on Hong Kong with
the passage of strict new national security laws has also raised tensions.
Crude oil futures ended lower on
Monday as concerns about the energy demand outlook resurfaced amid worries
about rising new coronavirus cases over the weekend. According to a report from
the World Health Organization (WHO), global coronavirus cases rose by over
230,000 across the globe over a 24-hour period. The United States topped the
list, with more than 66,000 cases recorded, as Florida surpassed the 15,000
mark of new cases on Sunday. Crude oil futures for August fell 45 cents or
about 1.1 percent to settle at $40.10 a barrel on the New York Mercantile
Exchange. September Brent crude declined 52 cents or 1.2 percent to settle at
$42.72 a barrel on London's Intercontinental Exchange.
Indian rupee trimmed most of its
early gains but managed to end marginally higher against the American currency
on Monday, due to selling of the US currency by exporters and banks. Traders
took some support with the Reserve Bank of India (RBI) Governor Shaktikanta
Das' statement that the Indian economy has started showing signs of going back
to normalcy. He added that post containment of COVID-19, a very careful
trajectory has to be followed in orderly unwinding of countercyclical
regulatory measures. On the global front, dollar edged lower on Monday as
investors looked to incoming global economic data and U.S. corporate earnings
to gauge whether the markets' guarded optimism on the economic outlook is
justified. Finally, the rupee ended at 75.19, 1 paise stronger from its
previous close of 75.20 on Friday.
The FIIs as per Monday'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 2590.15 crore against gross
selling of Rs 3524.44 crore, while in the debt segment, the gross purchase was
of Rs 2018.86 crore with gross sales of Rs 1549.39 crore. Besides, in the
hybrid segment, the gross buying was of Rs 2.28 crore against gross selling of
Rs 4.60 crore.
The US markets ended mostly in
red on Monday as California Governor Gavin Newsom rolled back the state's
reopening following a recent spike in coronavirus cases. Asian markets are
trading lower on Tuesday amid persistent concerns over the record number of new
coronavirus cases worldwide. Indian markets ended higher after a volatile
session on Monday led by gains in IT, FMCG stocks and index heavyweight RIL.
Today, the markets are likely to make pessimistic start following sell-off in
the Asian peers. Investors will be eyeing the wholesale inflation data to be
out later in the day. There will be some cautiousness with rising coronavirus
cases. India has recorded over 28,000 new cases in a day to take its total
number of Covid-19 cases to 907,645. This is the third consecutive day when
India has recorded over 28,000 new cases. Traders will be concerned as the
government data showed retail inflation increased to 6.09 per cent in June,
mainly on account of higher prices of food items. As per the data, food inflation in June
increased to 7.87 per cent. The numbers for April and May were not released due
to insufficient data collection in wake of the ongoing Covid-19 crisis. Market
participants may take note of report that agency S&P Global cut its emerging
market growth forecasts, predicting a 4.7 percent slump on average this year
due to the coronavirus and warned that all countries would be left with
permanent scars too. However, some respite may come later in the day as Prime
Minister Narendra Modi took stock of the financial sector which has been hit
hard by the outbreak of COVID-19 pandemic. He also reviewed the progress of a
host of measures announced under the Rs 20-lakh crore Aatmanirbhar Bharat
Abhiyan package to stimulate the economy and help the MSME sector and poor
sections of society. Some support may also come as after being net seller of
the US currency in the first month of this fiscal, the Reserve Bank of India
(RBI) turned net purchaser in May as it bought $4.363 billion of the greenback
on net basis. There will be some buzz in the insurance stocks with CARE
Ratings' statement that life insurers, which have seen their first-year
premiums contract 18.6 per cent in the first quarter of the financial year
2020-21 (FY21), could see recovery in the next quarter. IT stocks will be in
focus with ICRA's report that the Indian IT services sector may see an up to 3
per cent contraction in its revenues in the current fiscal amid multiple
challenges on the demand side. There will be some reaction aviation stocks with
the International Air Transport Association's (IATA) statement the passenger
demand for air travel will contract by 49 per cent this year for Indian
carriers in comparison to last year due to the Covid-19 crisis. There will be
lots of important earnings announcements too, to keep the markets in action.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,802.70
|
10,741.15
|
10,879.15
|
BSE Sensex
|
36,693.69
|
36,477.03
|
36,967.27
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Motors
|
819.00
|
108.00
|
105.87
|
111.12
|
State Bank of India
|
619.52
|
192.70
|
189.60
|
197.80
|
ICICI Bank
|
323.80
|
353.60
|
348.40
|
362.90
|
Reliance Industries
|
321.24
|
1,935.00
|
1,907.43
|
1,955.13
|
Hindalco Industries
|
218.95
|
169.25
|
165.40
|
171.80
|
HDFC ERGO General Insurance Company, a 51:49 JV between HDFC and ERGO International AG, has launched Corona Kavach policy.
Tata Motors has launched Fleet Edge, a next-generation connected vehicle fleet management solution with informed decision making.
Fitch Ratings has assigned the ratings to Adani Ports and SEZ's proposed foreign currency denominated bonds issuance.
Power Grid Corporation of India has received an approval for an investment of Rs 239.89 crore in an electricity transmission project.