Indian equity benchmarks traded
with a positive bias for most part of the day but selling activity which took
place during late hour of trade mainly forced the markets to cut all of their
gains and ended Friday's session with losses of over a percent each, amid
selling in Auto, Banking and Finance counters. The benchmarks opened higher and
were trading in a narrow range, as traders took some support with the Union
Health Ministry's statement that the Covid-19 recovery rate has risen to 70.77
per cent on August 13 with the total number of patients recuperating from the
disease reaching nearly 1.7 million, while the case fatality rate has further
declined to 1.96 per cent. Sentiments remained positive with Finance Minister
Nirmala Sitharaman's statement that the faceless tax scrutiny assessment and
appeal system would help ease compliance burden of taxpayers and increase
fairness and objectivity in the tax system. However, key indices wiped off morning
gains and fell sharply in the late afternoon session, amid cooling off buying
interest across sectors. Some cautiousness also came in with the data released
by the National Statistics Office (NSO) showing that India's retail inflation
as measured by the Consumer Price Index (CPI) increased to 6.93 percent in the
month of July as food prices continued to soar due to disrupted supply chains.
Though, markets managed to trim some losses in final minutes of trading, taking
support from data showing that the wholesale price-based inflation declined
0.58 per cent in July, even as food items turned costlier. WPI inflation in
June was at (-) 1.81 per cent, while for the month of May and April it was (-)
3.37 per cent and (-) 1.57 per cent respectively. However, fuel and power
basket inflation fell 9.84 per cent in July, compared to 13.60 per cent in the
previous month. Manufactured products, however, witnessed inflation of 0.51 per
cent in July, as against 0.08 per cent in June. Finally, the BSE Sensex fell
433.15 points or 1.13% to 37,877.34, while the CNX Nifty was down by 122.05
points or 1.08% to 11,178.40.
The US markets ended choppy
trading session mostly in red in Friday as traders seemed reluctant to make
more significant moves amid uncertainty about the near-term outlook for the
markets. With earnings season largely in the rear-view mirror and talks about a
new coronavirus relief bill at a stalemate, traders may be unsure about the
next catalyst to drive the markets. Traders also digested a slew of US economic
data, including a report from the Commerce Department showing retail sales
jumped by less than expected in July amid a pullback in auto sales. The
Commerce Department said retail sales advanced by 1.2 percent in July after
soaring by an upwardly revised 8.4 percent in June. Street had expected retail
sales to jump by 1.9 percent compared to the 7.5 percent spike originally
reported for the previous month. Excluding sales by motor vehicle and parts
dealers, retail sales surged up by 1.9 percent in July after skyrocketing by
8.3 percent in June. Ex-auto sales were expected to increase by 1.3 percent.
Meanwhile, the Federal Reserve released a report showing a jump in US
industrial production in the month of July that matched street estimates. The
Fed said industrial production surged up by 3.0 percent in July after soaring
by an upwardly revised 5.7 percent in June. Street had expected production to
jump by 3.0 percent compared to the 5.4 percent spike originally reported for
the previous month. Despite the substantial increases seen over the past two
months, the Fed noted production is still 8.4 percent below its pre-pandemic
February level. A preliminary reading released by the University of Michigan
unexpectedly showed a slight improvement in U.S. consumer sentiment in the
month of August. The report said the consumer sentiment index inched up to 72.8
in August from 72.5 in July. The uptick surprised street, who had expected the
index to edge down to 72.0.
Crude oil futures ended lower on
Friday after retail sales and industrial production numbers for July continue
to point to weak recovery in China. Official data showed that China's
industrial production grew 4.8 percent on a yearly basis in July, the same rate
of growth as seen in June, and weaker than the expected rise of 5.1 percent.
Retail sales dropped 1.1 percent from last year, confounding expectations for
an increase of 0.1 percent. During January to July period, fixed asset
investment decreased 1.6 percent versus a 3.1 percent decrease in January to
June. Crude oil futures for September dropped 23 cents or 0.5 percent to settle
at $42.01 a barrel on the New York Mercantile Exchange. October Brent crude
fell 11 cents or 0.2 percent to settle at $44.85 a barrel on London's
Intercontinental Exchange.
Indian rupee ended weaker against
dollar on Friday, on emergence of demand for the greenback from importers.
Sentiments remained fragile as government data showed retail inflation rose to
6.93 per cent in July, mainly driven by rising prices of food items like
vegetables, pulses, meat and fish. The inflation based on the Consumer Price
Index (CPI) stood at 3.15 percent in July 2019. Meanwhile, RBI remained net
purchaser of the US currency for the second consecutive month in June after it
bought $9.814 billion of greenback on a net basis. On the global front, dollar
steadied on Friday as a spike in U.S. bond yields and a drag on risk sentiment
from lackluster Chinese economic data slowed a sell down of the U.S. currency,
which was headed for its longest weekly losing streak since 2010. Finally, the
rupee ended at 74.90, 6 paise weaker from its previous close of 74.84 on
Thursday.
The FIIs as per Friday's data
were net buyers in both equity segment and debt segment. In equity segment, the
gross buying was of Rs 4552.48 crore against gross selling of Rs 4055.56 crore,
while in the debt segment, the gross purchase was of Rs 888.14 crore with gross
sales of Rs 297.44 crore. Besides, in the hybrid segment, the gross buying was
of Rs 10.13 crore against gross selling of Rs 25.02 crore.
The US markets closed mostly
lower on Friday after a weaker-than-expected rise in retail sales underlined
lingering questions about the economy's resilience following its pandemic-induced
collapse in the spring. Asian markets are trading mostly in green on Monday as
investors waited to see if the recent sell-off in longer-dated US. Indian
markets gave up early gains and ended lower on Friday, with rate-sensitive
bank, auto and financial services firms declining after data showed India's
retail inflation inched close to the 7% mark in July. Today, the start of new
week is likely to be optimistic following positive cues from Asian peers. Some
support will come in with report that foreign portfolio investors (FPI)
remained net investors in Indian markets in the first half of August, pumping
in Rs 28,203 crore in debt and equities on net basis in the period. Traders may
take note of president of CII's statement that PM's address was an address of
confidence in COVID times combined with aspiration & hope. India has to
understand the global trend, which is instead of multilateralism to
bilateralism. Move away from multilateralism because that is out of fashion as
I see it. Besides, the Reserve Bank of India's (RBI's) data showed that the
country's foreign exchange reserves swelled by $3.623 billion to a record high
of $538.191 billion in the week ended August 7. However, rising coronavirus
cases may impact the market sentiments. India has recorded over 58,108
coronavirus cases in the past 24 hours, taking its total to 2,647,316. With
over 961 fatalities reported on Sunday, the country's death toll has surged to
51,045. Some cautiousness may be there in the markets as the government data showed
that contracting for the fifth straight month, India's exports slipped 10.21
per cent to $23.64 billion in July, on account of decline in the shipments
of petroleum, leather and gems and jewellery items. Telecom stocks will be in
limelight as the Supreme Court will again hear the AGR case today. In last
week's hearing, the Supreme Court had directed telecom companies under
insolvency to submit details of spectrum sharing agreements that they have
entered into. Banking stocks will be in focus with latest data from the RBI
showing that bank credit and deposits grew 5.51 per cent and 11.11 per cent to
Rs 102.65 trillion and Rs 141.61 trillion, respectively, in the fortnight ended
July 31. There will be some reaction in agriculture related stocks with report
that as the sowing of kharif crops enters its last leg, acreage this year has
been almost 8.54% more than last year as of August 14.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,178.40
|
11,071.15
|
11,325.95
|
BSE Sensex
|
38,310.49
|
37,507.99
|
38,393.64
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Motors
|
750.35
|
124.60
|
121.31
|
130.26
|
State Bank of India
|
561.76
|
196.50
|
192.74
|
202.14
|
Tata Steel
|
477.42
|
418.50
|
408.09
|
429.94
|
Zee Entertainment
Enterprises
|
373.89
|
161.20
|
157.10
|
166.40
|
Axis Bank
|
367.26
|
435.85
|
423.80
|
449.70
|
Tata Motors has launched India's first 47.5-tonne multi-axle tipper truck for surface transport of coal and construction goods, priced at Rs 52.81 lakh.
Eicher Motors and Volvo Group's JV -- VE Commercial Vehicles is going to acquire Volvo Group's bus business in India for Rs 100.5 crore.
Infosys has expanded its support for GovHack 2020 which is set to kick off on August 14.
L&T's construction arm -- L&T construction has commenced executing a contract by its Heavy Civil Infrastructure Business.