Indian benchmark indices started the new week on a disappointing
note as they went on to extend the declining streak for the second successive
session as market participants resorted to hefty across the board position
squaring. Investors turned cautious after Ministry of Finance said that Urjit
Patel was named as the new Governor of Reserve Bank of India (RBI). Urjit Patel
is known for his hawkish view on inflation just like Raghuram Rajan whose term
as the RBI governor ends on September
4, 2016. By naming Patel who is a deputy governor at the central
bank as the new RBI governor, the government is sending signal to markets that
there will be continuity of central bank's policies. Besides, weak trend in Asian
stocks coupled with depreciation in rupee value against the US dollar also
weighed on the sentiment. However, investors got some comfort with Francis
Gurry, director-general at the World Intellectual Property Organization stating
that India can
break into the top-25 rank in the next 10 years. Also, the global rating agency
Moody's Investors Service in its latest report said that it may consider India
for a rating upgrade if the government is successful in introducing more growth
enhancing economic and institutional reform. Policies like relaxation of
thresholds for Foreign Direct Investment (FDI) and a change in the monetary
policy framework that fosters credibility will contribute to more stable
economic environment. On the global front, Asian markets ended mixed on Monday,
while European stocks traded mostly higher in early deal. Back home, the local
benchmarks got off to a sluggish opening in tandem with the pessimistic
sentiments prevailing in Asian markets. Thereafter, the key indices failed to
show any kind of fervor due to lack of encouraging leads. The selling pressure
accentuated in the early afternoon trades as investors took to across the board
risk aversion. Finally, the BSE Sensex slumped by 91.46 points or 0.33% to
27985.54, while the CNX Nifty dropped 37.75 points or 0.44% to 8,629.15.
The US
markets made a mixed closing on Monday after a lackluster trading as there were
no major economic announcements. While a sharp pullback by the price of crude
oil weighed on the markets, traders were keeping a close eye on Federal Reserve
Chair Janet Yellen's speech at the Kansas City Fed's monetary policy symposium
in Jackson Hole, Wyoming,
on Friday to gauge her stance on monetary policy and search for hints for when
a rate hike could arrive. While the Nasdaq ended up by 6.22 points or 0.05
percent to 5,244.60, the Dow Jones Industrial Average declined by 23.15 points
or 0.12 percent to 18,529.42 and the S&P 500 edged lower by 1.23 points or
0.06 percent to 2,182.64.
Crude
oil futures finally lost their gaining streak on Monday. Traders booked some
profit after the recent rally, also the indications of an ongoing recovery in US
drilling activity combined with elevated stocks of fuel products around the
world, coupled with worries about burgeoning Chinese fuel exports, more Iraqi
and Nigerian crude shipments, weighed on the sentiments. Meanwhile, Iraq
plans this week to increase exports of Kirkuk
crude by 150,000 bpd from its northern fields. Benchmark crude oil futures for
September delivery slumped by $1.47 or 3 percent to close at $47.05 a barrel
after trading in a range of $46.96 and $47.20 a barrel on the New York
Mercantile Exchange. In London,
Brent oil futures for October delivery declined by $1.72 or 3.4 percent to
$49.16va barrel on the ICE.
Indian rupee ended at fresh three-week low against dollar
on Monday after Urjit Patel's appointment as the new governor of the Reserve
Bank of India (RBI), reinforcing the view that the inflation hawk will persist
with his strident anti-inflation stance. Besides, dollar firmed up against some
global currencies on US interest rate hike hopes this year after the Federal
Reserve Vice Chairman Stanley Fischer too dampened rupee sentiment. On the
global front, yen weakened against the U.S. dollar on expectations of expanded
stimulus by the Japanese central bank next month. Finally the rupee ended at
67.18, weaker by 12 paise from its previous close of 67.06 on Friday.
The
FIIs as per Monday's data were net buyers in equity segment, while they were
net sellers in debt segment. In equity segment, the gross buying was of Rs
4287.14 crore against gross selling of Rs 3743.85 crore. While in the debt
segment, the gross purchase was of Rs 1039.30 crore with gross sales of Rs
1176.72 crore.
The US
markets turned cautious and made a mixed closing in last session, with
traders remaining on sidelines waiting for Fed chief's speech to gauge the
outlook for rate hike. The Asian markets have once again made a mixed start and
the Japanese market was trading in red despite report that Japan's government
is preparing a $33 billion supplementary budget to help fund Prime Minister
Shinzo Abe's economic stimulus package. The Indian markets suffered some profit
taking in last session, amid weak global cues and fading hopes of rate cut
after nomination of Urjit Patel as news RBI Governor, who is known for his
hawkish view on inflation. Today, the
start is likely to remain a bit cautious but some recovery can be expected in
latter trade, with the business confidence index maintained by NCAER gaining 2.2
per cent during the June quarter helped by increasing optimism towards the
coming six months. Markets will also be getting some encouragement with report
that India will
highlight the goods and services tax (GST) and other policy measures taken to
boost ease of doing business in the country in its bid to get more investments
from the US at
the second Indo-US Strategic and Commercial Dialogue in New
Delhi next week. However, there will be some
cautiousness in the market with report that pledging of shares by promoters in
companies listed on the National Stock Exchange hit a seven year high at the
end of June. There will be some buzz in the port and shipping sector stocks, as
the Union Minister for Road Transport, Highways and Shipping, Nitin Gadkari has
said that the government will abolish the Tariff Authority for Major Ports or
TAMP and introduce a new Act that will govern the sector. Gadkari said that the
Centre is working on a proposal to form subsidiaries under the 12 major ports
in India which
will invest in developing inland waterways across the country. Some action can
be seen in logistics stocks, with Chhattisgarh Assembly on Monday unanimously
ratifying the Constitutional Amendment Bill on the Goods and Services Tax at a
special session.
Support and Resistance: NSE (Nifty)
and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
8629.15
|
8600.48
|
8671.33
|
BSE Sensex
|
27985.54
|
27887.97
|
28113.20
|
Nifty Top volumes
Stock
|
Volume
(in Lacs)
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
State Bank of India
|
197.70
|
254.80
|
252.40
|
258.80
|
Axis Bank
|
94.99
|
580.25
|
576.45
|
587.00
|
BHEL
|
84.1
|
143.90
|
141.20
|
146.50
|
ICICI Bank
|
82.52
|
252.25
|
248.98
|
255.23
|
Bank of Baroda
|
80.26
|
160.05
|
157.72
|
162.37
|
- NTPC
has registered 4.09 percent rise in its net profit at Rs 2369.53 crore for the
quarter ended June 30, 2016,
as compared to Rs 2276.50 crore for the same quarter in the previous year.
- Lupin
has received an approval for Acotiamide 100 mg Tablets from the Central Drugs
Standard Control Organisation.
- Competition
Commission of Indian has cleared HCL Technologies' equity swap deal to buy the
business of Geometric.
- Power
Grid Corporation of India
has received its board approval for three investment proposals worth Rs 733.32
crore for power transmission related projects.
- Larsen
& Toubro's construction arm -- L&T Constructions has received orders
worth Rs 700 crore from Piramal Group's real estate firm, Piramal Realty for
construction of its housing project - Piramal Aranya in Mumbai.