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NSE Intra-day chart (27 April 2016)
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Market Commentary 28 April 2016
Markets to make a mildly positive start ahead of the F&O series expiry


Wednesday's trading session was of consolidation and the Indian benchmark indices appeared a bit fatigued remaining in tight range throughout the day. Nevertheless, the benchmarks managed to extend the winning momentum for the second consecutive day of trade, as local sentiments continued to show signs of improvement. There was some support with the SASCOF indication that Central, western and north western parts of India are likely to get above normal rainfall, while most of the remaining parts of the country, barring some exceptions, are set to get normal rainfall. SASCOF predicted development of weak positive Indian Ocean Dipole (IOD) conditions, which favours good monsoon rainfall, in early part of monsoon season. Further, Niti Aayog vice-chairman Arvind Panagariya said that the economy is expected to grow over 8 per cent this fiscal with the forecast of above-normal monsoon raising hopes of the agriculture sector's revival after two successive drought years. Some support also came in from reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 512.22 crore on April 26, 2016. However, investors remained cautious ahead of US and Japanese central bank policy decisions, while private sector lender Axis Bank fell on expectations of more bad loans in the current financial year. Meanwhile, shares of oil companies gained after crude oil prices hit 2016 highs on Tuesday, while telecom stocks surged amid reports that Reliance Jio may delay its launch of 4G service, while Moody's report on the Bharti-Videocon deal also boosted sentiment. On the global front, most of Asian markets ended the session on weak note, European stocks too slipped in early trade, weighed down by some weak corporate earnings. Back home, after getting weak start, Indian frontline equity indices traded in the tight range around the neutral line for most part of the session, as investors remained cautious ahead of the outcome of the US Fed meet later today and the expiry of April derivative contracts on Thursday, however hefty buying in several frontline counters helped the indices to end the session on positive note. Finally, the BSE Sensex gained 56.82 points or 0.22% to 26064.12, while the CNX Nifty rose 17.25 points or 0.22% to 7,979.90.


The US market closed mostly higher on Wednesday, after the Federal Reserve left interest rates unchanged and provided little indication when it would deliver another rate rise. The Federal Reserve voted to leave interest rates unchanged but kept their options open for a move in June. For the third time since the start of the year, Chairwoman Janet Yellen and her colleagues voted to keep the federal funds rate in a range of 0.25-0.5%. In its carefully calibrated statement, the Fed moderated previous expression of concern about global financial and economic developments. On the economy front, an early look at US trade patterns in March points to a sharp drop in the nation's trade deficit. The trade gap in goods - services are excluded - fell 9.5% to $56.9 billion. The goods deficit was $62.8 billion in the prior month. A smaller deficit in March could give first-quarter gross domestic product a nudge upward, though the number is still expected to be weak. Meanwhile, a gauge of pending home sales rose 1.4% in March, its second monthly increase in a sign of momentum for the spring buying season. The Dow Jones Industrial Average added 51.23 points or 0.28 percent to 18,041.55, S&P 500 was up 3.45 points or 0.16 percent to 2,095.15 while, Nasdaq was down by 25.14 points or 0.51 percent to 4,863.14.


Crude oil futures surged, extending their gains on Thursday to hit a fresh yearly-high, after the Federal Reserve held interest rates steady for the third consecutive meeting. Traders overlooked the reports of a moderate build in U.S. crude stockpiles last week. The US Energy Information Administration (EIA) said in its Weekly Petroleum Status Report that domestic crude inventories rose by 2.0 million barrels for the week ending on April 22. Benchmark crude oil futures for June delivery surged by $1.12 or 2.54 percent to $45.16 a barrel after trading in a range of $43.77 and $45.59 a barrel on the New York Mercantile Exchange. In London, Brent crude for June delivery closed at $46.81, up $1.23 or 2.72 percent on the ICE.


Indian rupee ended stronger for second consecutive session against dollar due to selling of greenback by banks and exporters, amid gains in Asian currency market. Rupee looked strong from the very beginning and was supported by the gains in local equity market. Some support also came with Niti Aayog vice-chairman Arvind Panagariya's statement that the economy is expected to grow over 8 per cent this fiscal with the forecast of above-normal monsoon. Meanwhile, market participants remained cautious ahead of US FOMC meet today and BOJ policy meeting tomorrow, which capped some rupee gains. On global front, dollar fell against a basket of currencies as investors remained cautious ahead of the outcome of the Federal Reserve on interest rates. Finally, the rupee ended at 66.45, 7 paise stronger from its previous close of 66.52, on Tuesday.


The FIIs as per Wednesday'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 4872.63 crore against gross selling of Rs 4300.93 crore, while in the debt segment, the gross purchase was of Rs 396.07 crore with gross sales of Rs 1257.65 crore.          


The US markets once again made a mixed closing, following the Federal Reserve's monetary policy announcement, which did not contain any major surprises. The central bank also reiterated that the actual path of rates will depend on the economic outlook as informed by incoming data. The Asian markets have made a mixed start with some of the indices gaining over a percent after the Federal Reserve's interest-rate signals and ahead of the Bank of Japan's policy decision. The Indian markets picked up pace in late hours and managed a marginally positive close in last session. Today the start of the F&O expiry session is likely to be in green tailing the gains in the other regional markets, however there will be volatility too, as the April series will expire later in the day and the traders will be adjusting and rolling over their positions. Though, market men will be getting some encouragement with the report that foreign direct investment (FDI) into the country has increased 37 percent after the launch of 'Make in India' programme till February this year. The overseas inflows grew 29 percent during the period compared to the 15-month period prior to the launch. Meanwhile, increasing the chances of the long-delayed Bankruptcy Code securing parliamentary assent in the current session, a joint committee of both Houses has approved insolvency code. There will be some important earnings announcements that will keep the markets buzzing for the day.


Support and Resistance: NSE Nifty and BSE Sensex



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  • Larsen & Toubro's construction arm L&T Constructions has won orders worth Rs 1798 crore across its business segments in April 2016.
  • Yes Bank has reported a rise of 27.43% in its net profit at Rs 702.11 crore for the quarter ended March 31, 2016 as compared to Rs 550.99 crore for the same quarter in the previous year.
  • NTPC, the country's biggest power generator, is entering the wind energy segment for the first time.
  • Maruti Suzuki India is all set to start operations in Gujarat, four months ahead of schedule in January 2017.
  • Axis Bank has posted a marginal fall of 1.21% in its net profit at Rs 2154.28 crore for the quarter ended March 31, 2016 as compared to Rs 2180.59 crore for the same quarter in the previous year.
News Analysis