Key Indian benchmarks extended
northward journey for the third straight session and ended the Tuesday's
trading session in green territory, amid positive earnings optimism among
traders. The markets made a firm start to remain bullish throughout the
session, aided by the United Nations Conference on Trade and Development's
(UNCTAD) latest report indicating that in South Asia, India attracted $22
billion of foreign direct investment (FDI) flows, contributing to the
subregion's 13% rise in FDI in the first half of 2018 (H1 2018). Adding some
optimism, India's trade deficit declined to a five-month low in September even
as exports contracted, providing some respite from the rising gap that has
sparked concern about the current account deficit (CAD). Trade deficit declined
to $13.98 billion in September from $17.39 billion in August following slower growth
in imports. Besides, exports were pegged at $27.95 billion in September, down
2.15% from a year ago, while imports rose 10.45% to $41.9 billion, lowest in
five months. Optimism continued on the street, with a private report stating
that strong earnings, promising demographics and big ticket deals drove the
M&A activity, clocking deals worth $76 billion in January-September from
over 350 transactions. Some support also came with reports that India and the
UAE deliberated on opportunities for cooperation and investment in both the
countries, in order to drive investments in areas including highways, airports
and infrastructure. The street took note of Finance Minister Arun Jaitley's
statement that India needs a strong and decisive leadership at the Centre to
continue its high growth path and take swift decisions. Investors also took
some support with a report that Foreign Institutional Investors (FIIs) bought
shares worth Rs 67.86 crore on October 15, 2018, as per provisional data from
the stock exchanges. Finally, the BSE Sensex surged 297.38 points or 0.85% to
35,162.48, while the CNX Nifty was up by 72.25 points or 0.69% to 10,584.75.
The US markets ended the
Tuesday's trade on an optimistic note with all the major indices garnering a
gain of over two percentage points. The rally on Wall Street partly reflected a
positive reaction to upbeat earnings news from several big-name companies, with
financial giants Goldman Sachs (GS) and Morgan Stanley (MS) reporting third
quarter results that beat estimates on both the top and bottom lines. Buying
interest was generated following the release of positive economic data,
including a report from the Federal Reserve showing industrial production
increased in line with economist estimates in September. The report said
industrial production rose by 0.3 percent in September after climbing by 0.4
percent in August. The continued increase in production matched expectations.
The Fed said output growth in September was held down slightly by Hurricane
Florence but noted the estimated negative effect was less than 0.1 percentage
points. A separate report from the National Association of Home Builders showed
an unexpected uptick in homebuilder confidence in the month of October. The
report said the NAHB/Wells Fargo Housing Market Index inched up to 68 in
October from 67 in September. Street had expected the index to come in
unchanged. S&P 500 surged 59.13 points or 2.15 percent to 2,809.92, Dow
Jones Industrial Average soared 547.87 points or 2.17 percent to 25,798.42 and
Nasdaq was up by 214.74 points or 2.89 percent to 7,645.49.
Crude oil prices edged lower on
Tuesday, as traders waited to see if relations between the US and Saudi Arabia
sour further following the disappearance of a journalist in Turkey. Worsening
tensions between the two nations could result in a curtailment of global crude
production from one of the most significant members of the Organization of the
Petroleum Exporting Countries. Meanwhile, investors shrugged off reports
suggesting that Iranian crude exports have fallen further in the first two
weeks of October. The sanctions on Iran's oil sector will go into effect on
November 4. Benchmark crude oil futures for November declined 14 cents or 0.2%
to settle at $71.92 a barrel on the New York Mercantile Exchange. December
Brent crude dropped 63 cents or 0.8 percent to settle at $81.41 a barrel on
London's Intercontinental Exchanged.
Indian
rupee ended stronger against dollar on Tuesday, due to increased selling of the
American currency by exporters. Traders took encouragement with report that
India's trade deficit declined to a five-month low in September even as exports
contracted, providing some respite from the rising gap that has sparked concern
about the current account deficit (CAD). Trade deficit declined to $13.98
billion in September from $17.39 billion in August following slower growth in
imports. Besides, exports were pegged at $27.95 billion in September, down
2.15% from a year ago, while imports rose 10.45% to $41.9 billion, lowest in
five months. Meanwhile, the rupee derived its strength from strong gains in the
local equity markets as well as strength of other Asian currencies against
dollar. On the global front, dollar was mired near a three-week low on Tuesday
thanks to tepid US data overnight, though broadly firmer US Treasury yields
prevented a sell-off. Finally, the rupee ended at 73.48, 35 paise stronger from
its previous close of 73.83 on Monday.
The
FIIs as per Tuesday's data were net sellers in equity and debt segments both.
In equity segment, the gross buying was of Rs 3795.61 crore against gross
selling of Rs 3796.27 crore, while in the debt segment, the gross purchase was
of Rs 357.04 crore with gross sales of Rs 530.03 crore. Besides, in the hybrid
segment, the gross buying was of Rs 0.04 crore against gross selling of Rs 1.65
crore.
Recovering from previous
session's losses, the US markets settled higher on Tuesday as a batch of strong
earnings reports pushed aside lingering tensions over trade and geopolitics
that have pressured markets. Asian markets were trading in green on Wednesday
after upbeat US earnings reports drove a rebound on Wall Street and helped
restore a little confidence in emerging market stocks and currencies. Extending
gains for third consecutive session, Indian markets ended Tuesday's trade on
positive note with Sensex and Nifty settling above 35,100 and 10,550 levels,
respectively, on upbeat cues from the global markets coupled with a recovery in
the rupee and easing crude oil prices. Today, the markets are likely to make
gap-up opening following firm trade in global markets. Traders will be getting
some encouragement with report that India has been ranked as the 58th most
competitive economy on the World Economic Forum's global competitiveness index
for 2018, which was topped by the US. The WEF said India's rank rose by five
places from 2017, the largest gain among G20 economies. There will be some
support with the Reserve Bank of India's (RBI) forecast that the share of
investments in gross domestic product (GDP) will rise to 33% by FY23 from 31.4%
recorded in the last fiscal. Meanwhile, NITI Aayog CEO Amitabh Kant said that
Gender parity and exports are two critical areas which India must focus on to
be able to grow at higher rates of 9-10% per year for the next three decades or
more to lift a very young population above poverty line. However, there may be
some cautiousness with Commerce and Industry Minister Suresh Prabhu's statement
that no country can benefit from the decline in the world trade, and the
slowing global economy is a concern for all nations including India. Traders
may react to a report that investments in the Indian capital market through
participatory notes (P-notes) hit a nearly nine-and-a-half year low of Rs
79,548 crore till September after registering a rise in such fund infusion in
the preceding month. There will be lots of earnings reaction based on the
performance of the companies to keep markets buzzing.
Support and Resistance: NSE (Nifty) and BSE
(Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,584.75
|
10,538.40
|
10,618.00
|
BSE Sensex
|
35,162.48
|
34,978.43
|
35,281.16
|
Nifty Top volumes
Stock
|
Volume
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
SBI
|
335.97
|
270.30
|
265.48
|
272.98
|
Yes Bank
|
180.99
|
248.90
|
245.87
|
251.67
|
ICICI Bank
|
180.43
|
320.65
|
315.28
|
324.48
|
Axis Bank
|
130.84
|
588.85
|
574.62
|
598.72
|
HPCL
|
122.66
|
212.15
|
207.83
|
216.68
|
NTPC has discontinued operations of Badarpur Thermal Power Station in New Delhi having total installed capacity of 705 MW with effect from October 15, 2018.
SBI's digital service platform YONO has launched a six-day shopping festival beginning October 16 in which customers using the app for shopping via online portals can avail discounts.
M&M will launch its luxury SUV, codenamed Y400, on November 19, 2018.
Infosys has reported a rise of 10.31% in its net profit at Rs 4,110 crore for Q2FY19 as compared to Rs 3,726 crore for Q2FY18.