Volatility pulled Indian equity
markets lower on Monday, with Sensex & Nifty ending in red terrain. The
start of the day was positive, aided with Finance Commission Chairman N K
Singh's statement that the current economic slowdown is episodic & expressed
hope that sluggishness will not continue for long. However, key indices soon
turned volatile, after economic think-tank National Council of Applied Economic
Research (NCAER) said that India's economic growth is likely to decline to 4.9%
in the second quarter of this fiscal.
Besides, the think-tank pegged Gross Domestic Product growth at 4.9% as
for the full fiscal 2019-20 against 6.8% in 2018-19. Key benchmarks remained
below their respective neutral lines for the most part of the trading day, as
India's merchandise exports contracted by 1.11% in October 2019 as compared to
same period of last year, mainly on account of a significant dip in shipments
of petroleum, carpet, leather products, rice and tea. Trade deficit, gap
between imports and exports, narrowed to $11.01 billion in October from $18.0
billion a year ago. Market participants paid no heed towards Confederation of
Indian Industry (CII), Director-General Chandrajit Banerjee's statement that
Indian Public Sector Enterprises can become globally competitive. Finally, the
BSE Sensex fell 72.50 points or 0.18% to 40,284.19, while the CNX Nifty was
down by 10.95 points or 0.09% to 11,884.50.
The US markets eked out fresh
all-time highs on Monday, notching marginal gains as progress toward a
so-called phase-one US-China trade agreement remained elusive. The Trump
administration issued a 90-day extension of a license allowing US companies to
continue doing business with Chinese telecom giant Huawei Technologies Company.
Huawei was added to a federal list of restricted entities earlier the year,
which are suspected of working against US national security interests. Its
status has been seen as a key issue in trade negotiations. However, upside
remained capped on private report that Chinese officials have grown pessimistic
about the chances for a trade deal. Report added strategy now to talk but wait
due to impeachment, US election. Also prioritize China economic support. On the
economic data front, after reporting an unexpected improvement in US
homebuilder confidence in the previous month, the National Association of Home
Builders released a report showing confidence edged slightly lower in the month
of November. The report said the NAHB/Wells Fargo Housing Market Index slipped
to 70 in November after climbing to 71 in October. Street had expected the
index to come in unchanged. The modest decrease came after the housing market
index rose for four straight months to reach its highest level since hitting a
matching reading in February of 2018.
Crude oil futures ended lower on
Monday on account of excess supply in the market. Energy Information
Administration (EIA) said in a monthly report that crude-oil production from
seven major US shale plays is forecast to climb by 49,000 barrels a day in
December to 9.133 million barrels a day. Oil output from the Permian Basin,
which covers parts of western Texas and southeastern New Mexico, is expected to
see the biggest increase, up 57,000 barrels a day in December from November.
Besides, cautiousness also prevailed in the oil markets amid uncertainty over a
potential trade deal between the US and China. Uncertainty about a deal
resurfaced after a report suggested Chinese officials have grown pessimistic
about the chances for a trade deal due to US President Donald Trump's
reluctance to roll back tariffs. Benchmark crude oil futures for December
dropped 67 cents or 1.2 percent to settle at $57.05 a barrel on the New York
Mercantile Exchange. January Brent lost 86 cents or 1.4 percent to settle at
$62.44 a barrel on London's Intercontinental Exchange.
Indian
rupee pared all of its gains and ended marginally weaker against dollar on
Monday, due to fresh demand for the American currency from banks and importers.
Investors were worried with Economic think-tank NCAER's report that the
country's GDP growth is likely to decline to 4.9 per cent in the second quarter
of this fiscal due to sustained slowdown in virtually all the sectors. Some
anxiety also came as India's merchandise exports contracted by 1.11% in October
2019 as compared to same period of last year, mainly on account of a
significant dip in shipments of petroleum, carpet, leather products, rice and
tea. Trade deficit, gap between imports and exports, narrowed to $11.01 billion
in October from $18.0 billion a year ago. Besides, lackluster trade in local
equity markets weighed on the rupee. On the global front, euro edged higher
against the dollar on Monday, on expectations that Washington and Beijing can
soon sign off on a deal to end a trade war that has been a drag on global
economic growth. Finally, the rupee ended at 71.84, 6 paise weaker from its
previous close of 71.78 on Friday.
The
FIIs as per Monday's data were net sellers in both equity and debt segments. In
equity segment, the gross buying was of Rs 5117.71 crore against gross selling
of Rs 6284.58 crore, while in the debt segment, the gross purchase was of Rs
477.76 crore with gross sales of Rs 1047.85 crore. Besides in the hybrid
segment, the gross buying was of Rs 36.11 crore against gross selling of Rs
33.88 crore.
The US markets ended higher with
marginal gains on Monday as investors waited for concrete progress on US-China
trade relations after mixed headlines. Asian markets are trading mixed on
Tuesday as another day awaiting clearer news on the progress of US-China trade
negotiations weighed on jaded investors' sentiment. Indian markets ended rang
bound trade in red on Monday, tracking losses in HDFC Bank, RIL and TCS amid
rising concerns over economic slowdown. Today, the markets are likely to make
flat-to-negative start amid mixed cues from Asian peers. There will be some
cautiousness with a private report indicating that India's real Gross Domestic
Product (GDP) growth is likely to average at 5 per cent in calendar year 2019,
as against 7.4 per cent last year, before picking up to 6.3 per cent in 2020
and 6.8 per cent the next year. Also, there will be some concern with the
another report highlighting that India has slipped 6 places to 59 rank on a global
annual list of 63 countries, due to low quality of life and expenditure on
education. Though, some respite may come later in the day with Union Minister
Anurag Thakur's statement that India is not facing 5 per cent economic slowdown
and continues to be the fastest growing economy in the world. Thakur also said
that a number of steps are being taken by the government to strengthen the
economy that includes merger of banks and tax concessions to industries.
Meanwhile, leading bourse NSE said it has introduced the facilitation of
subscription in State Development Loans (SDLs) through its e-Gsec platform that
will enable retail participation in securities issued by state governments.
There will be some buzz in the telecom stocks with report that the telecom regulator
expects to finalize its views on the contentious call connect charges issue by
the end of this month. Aviation stocks will be in focus with Directorate
General of Civil Aviation's (DGCA) report that indicating some recovery in the
aviation sector due to the tourist season, the domestic air passenger traffic
this October increased by 3.98 per cent compared to the same month last year.
There will be some reaction in NBFC stocks with report that the Reserve Bank
can now seek resolution of non-banking financial companies having assets worth
of at least Rs 500 crore under the insolvency law, a move that is likely to
help in addressing woes in the NBFC sector. Also, metal stocks will be in focus
with repro that India's finished steel exports dipped 33.9 per cent to 6.36
million tonne (MT) in 2018-19, amid the government's efforts to keep the
country as the net exporter of the metal.
Support and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,884.50
|
11,852.67
|
11,931.27
|
BSE Sensex
|
40,284.19
|
40,156.64
|
40,477.07
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
1,781.51
|
65.85
|
64.42
|
68.27
|
Bharti Airtel
|
426.61
|
409.20
|
394.02
|
422.47
|
SBI
|
390.09
|
325.10
|
322.62
|
328.72
|
ICICI Bank
|
229.10
|
498.35
|
495.18
|
502.98
|
Tata Motors
|
190.53
|
170.10
|
168.87
|
171.72
|
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Bajaj Finserv is offering attractive discounts, coupon deals and cashback offers to its customers purchasing Vivo smartphones by availing hassle-free finance from the company.