Indian equity benchmarks ended
the last trading day of the week on lackluster note with the losses of around 1
percent each. The start of trading day was sluggish, impacted by widening
Fiscal deficit data. The central government's fiscal deficit widened in the
first half (H1) of current fiscal year (2018-19). Fiscal deficit was 95.3% of
the Budget Estimate (BE) in the first six months (April-September) of FY19,
mainly on account of slow growth in revenue collections. The street also got
cautious with a private report stating that India's tight money conditions and
fears of a contagion following a debt crisis at a local lender dented demand
and put a muzzle on animal spirits in the world's fastest-growing major
economy. Adding some anxiety among the traders, the Securities and Exchange
Board of India (SEBI) imposed a total penalty of Rs 70 lakh on 10 entities for
indulging in manipulative trade in the shares of Shree Global Tradefin. Traders
took note of India ratings' report that the rupee may average at 69.79 to the
dollar in the second half, down 8.3% from the first half if the monetary
authority props it up by mobilising at least $30 billion from NRIs as it has
done in 2013. It added that the rupee is the worst-performing emerging market
currency losing over 15% year-to-date. The indices extended the losses in the
last hours of the trade to settle near their intraday low points, tracking weak
European markets. Sentiment remained pessimistic, as the provisional data from the
stock exchanges showed that foreign institutional investors (FIIs) sold shares
worth a net Rs 1495.71 crore on October 25, 2018. Investors paid no heed
towards Director General of Foreign Trade (DGFT) Alok Chaturvedi's statement
that the commerce ministry is working on a comprehensive strategy and
considering incentives for exporters with a view to boost the country's
outbound shipments. He also said that the exports, which recorded about 10%
growth in 2017-18 to over $300 billion, is expected to reach $330-340 billion
this fiscal. The market participants even failed to take any sense of relief
with Prime Minister Narendra Modi's statement that India offers unprecedented
employment and entrepreneurial opportunities. Finally, the BSE Sensex fell
340.78 points or 1.01% to 33,349.31, while the CNX Nifty was down by 94.90
points or 0.94% to 10,030.00.
The US markets ended the Friday's
trade significantly lower with major indices losing around two percentage
points amid a negative reaction to corporate results from some big-name
companies after upbeat results from companies like Microsoft (MSFT) and Twitter
(TWTR) contributed to the jump on Thursday. Traders paid no heed towards report
from the Commerce Department showing stronger than expected US economic growth
in the third quarter. The Commerce Department said real gross domestic product
advanced by 3.5 percent in the third quarter after surging up by 4.2 percent in
the second quarter. Traders had expected GDP growth to slow to 3.3 percent. The
slowdown in the pace of growth in the third quarter came after the jump in the
second quarter represented the fastest growth since a 4.9 percent spike in the
third quarter of 2014. On the inflation front, the Commerce Department said its
reading on core consumer prices, which exclude food and energy prices, showed
price growth slowed to 1.6 percent in the third quarter from 2.1 percent in the
second quarter. A separate report from the University of Michigan showed
consumer sentiment deteriorated by slightly more than initially estimated in
the month of October. The report said the consumer sentiment index for October
was downwardly revised to 98.6 from the preliminary reading of 99.0. The street
had expected the consumer sentiment index to be unrevised at 99.0, which was
still down from 100.1 in September. Dow Jones Industrial Average declined 296.24
points or 1.19 percent to 24688.31, Nasdaq tumbled 151.12 points or 2.07
percent to 7167.21 and S&P 500 was down by 46.88 points or 1.76 percent to
2658.69.
Extending winning streak for
third straight day, Crude oil futures settled modestly higher on Friday, thanks
to some bargain hunting after recent losses and on hopes OPEC may resort to
some production cuts towards the end of this year. Saudi OPEC governor Adeeb
Al-Aama said the oil market could shift into oversupply in the last quarter of
the year and that OPEC may have to return to oil production cuts. However, oil
prices still posted a third weekly loss amid speculation that demand for oil
will drop in the near term with the outlook for global economic growth rather
dim, given the likely impact of the ongoing U.S.-China trade war, geopolitical
worries and corporate earnings concerns. Benchmark crude oil futures for
December gained 26 cents or 0.4 percent to settle at $67.59 a barrel on the New
York Mercantile Exchange. December Brent crude was up by 73 cents or nearly 1
percent to settle at $77.62 a barrel on London's Intercontinental Exchanged.
Falling
for the second consecutive session, Indian rupee depreciated against dollar on
Friday, on increased demand for the US currency from importers. Sentiments
remained weak with the Controller General of Accounts' (CGA) data showing that
the fiscal deficit of the Central government has widened in the first half of
2018-19 to 95.3% of the Budget Estimate (BE), mainly on account of slow growth
in revenue collections. The deficit was at 91.3% of BE at September-end of the
last financial year. Some cautiousness also crept in with a private report
stating that India's tight money conditions and fears of a contagion following
a debt crisis at a local lender dented demand and put a muzzle on animal
spirits in the world's fastest-growing major economy. Moreover, weakness in
local stocks, which slipped for a second-straight session, also weighed on the
rupee. On the global front, dollar rose on Friday, as investors waited to see
if US economic growth figures do anything to interrupt its months of strength.
Finally, the rupee ended at 73.47, 20 paise weaker from its previous close of
73.27 on Thursday.
The FIIs as per Friday'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 6712.11 crore against gross
selling of Rs 8045.09 crore, while in the debt segment, the gross purchase was
of Rs 1600.53 crore with gross sales of Rs 364.46 crore. Besides, in the hybrid
segment, the gross buying was of Rs 1.13 crore against no selling.
The US markets ended sharply
lower on Friday on disappointing results from a handful of megacap companies
amid slow down in global growth. Asian markets were trading mixed on Monday as
sentiment remained fragile amid heightened worries about a slowdown in global
economic growth and corporate earnings. Extending losses for second straight
session, Indian markets ended sharply lower on Friday, with Sensex and Nifty
settling over seven-month lows as weak global cues coupled with disappointing
earnings releases dented investors sentiments. Today, the markets are likely to
make cautious start of the new week amid mixed global cues. There will be some
concern with the Reserve Bank of India's (RBI) data showing that the country's
foreign exchange reserves declined by $942 million to $393.523 billion in the
week to October 19 on account of a fall in foreign currency assets. In the
previous week, the reserves had seen a steep fall of $5.14 billion to reach
$394.465 billion. However, some support may come with Union Minister of
Commerce and Industry and Civil Aviation Suresh Prabhu's statement that
country's exports rose by 9.8% in the financial year 2017-18, which is the
highest rate of growth in last six years. He added that this positive growth in
exports has taken place at a time when there is a lot of negative headwinds
globally. Traders may take note of the RBI's statement that it will inject Rs
400 billion into the system in November through a purchase of government securities
as it looks to meet festive season demand for funds. Meanwhile, the government
expects bad loan recoveries to exceed Rs 1.80 lakh crore target for the current
financial year, enthused by the impact of new insolvency and bankruptcy law.
Moreover, the Prime Minister's Economic Advisory Council (PMEAC) Chairman Bibek
Debroy said the current four-slab Goods and Services Tax (GST) rate structure
is likely to be reduced to three as the process of rationalising India's new
indirect tax regime proceeds further. There will be some buzz in banking sector
stocks with the RBI's data showing that Bank credit increased by 14.35% to Rs
89.93 lakh crore in the fortnight ended October 12, while the deposits rose by
8.86% to Rs 117.85 lakh crore. sugar sector stocks will be in focus as over 400
sugar producers and intermediaries are congregating on October 29, to evolve
strategies to boost India's sweetener exports in the current crushing season
which began in October.
Support and Resistance: NSE (Nifty) and BSE
(Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,030.00
|
9,980.08
|
10,104.38
|
BSE Sensex
|
33,349.31
|
33,168.33
|
33,653.55
|
Nifty Top volumes
Stock
|
Volume
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
957.60
|
180.70
|
168.98
|
192.03
|
ICICI Bank
|
229.52
|
315.65
|
311.30
|
321.70
|
ITC
|
214.76
|
280.90
|
274.67
|
288.47
|
SBI
|
205.43
|
248.10
|
246.17
|
251.27
|
Tata Motors
|
195.85
|
168.50
|
165.33
|
172.23
|
Yes Bank has reported 3.79% fall in its net profit at Rs 964.70 crore for Q2FY19 as compared to Rs 1,002.73 crore for Q2FY18.
JSW Steel planning to raise up to Rs 5,000 crore through a rights issue, so as to tie the funding in place to acquire bankrupt Bhushan Power and Steel.
Bajaj Finance has raised funds aggregating to Rs 425 crore via private placement.
ITC has reported a rise of 4.82% in its net profit at Rs 2,954.67 crore for Q2FY19 as compared to Rs 2,818.68 crore for Q2FY18.