Extending southward journey for
third straight day, Indian equity benchmarks witnessed bloodbath with frontline
gauges ending below their crucial 34,400 (Sensex) and 10,350 (Nifty) levels.
Markets started the session on pessimistic note, as traders remain concerned
about Union minister Nitin Gadkari's statement that the country is facing lot
of economic crisis due to crude oil imports and need to reduce imports and
increase exports. Some cautiousness also crept in with a private report that
liberalising foreign borrowings for oil companies to raise to $10 billion will
not have a material impact on arresting the slide of the rupee. Adding some
worries, Fitch Ratings in its latest report said that the acquisitions of
distressed Indian steel assets could significantly increase the leverage of the
acquiring companies, which also face the risk of domestic output being
displaced by a substantial increase in imports from the escalation of trade
barriers. Selling got intensified in last leg of trade to end below their
respective crucial levels, after the Reserve Bank of India (RBI) kept the repo
rate unchanged at 6.5%. However, the MPC changed the stance from Neutral to Calibrated Tightening. Domestic sentiments also got hit with a private report
indicating that amidst the erratic distribution of monsoon rains and with the
possibilities of as many as 254 districts facing drought like situation, the
total kharif cereals production likely to decline marginally by 1.71% compared
to last kharif. The markets participants paid no heed towards Finance Minister
Arun Jaitley's statement that the government is determined to contain the
crisis at the IL&FS at the earliest so that it does not leave any adverse
impact. The street even overlooked a report that salaries in the country are
projected to increase by 10% in 2019, the highest in the Asia Pacific region.
Finally, the BSE Sensex tumbled 792.17 points or 2.25% to 34,376.99, while the
CNX Nifty was down by 282.80 points or 2.67% to 10,316.45.
Extending losses for second
straight session, the US markets ended lower on Friday on worries about runaway
inflation spurred by the sudden jump in US Treasury bond yields. Dow Jones
Industrial witnessed its biggest one-day percentage drop since August, while
both the S&P and the Nasdaq logged the biggest daily drop since late June.
Besides, the Labor Department report showed weaker than expected job growth in
September, the jump in employment in August was upwardly revised and the unemployment
rate fell to its lowest level since 1969. The Labor Department said non-farm
payroll employment climbed by 134,000 jobs in September, while street had
expected an increase of about 185,000 jobs. However, the report also showed a
significant upward revision to the pace of job growth in August, with
employment spiking by 270,000 jobs compared to the originally reported jump of
201,000 jobs. As per the data, the unemployment rate fell to 3.7% in September
from 3.9% in August. The unemployment rate had been expected to edge down to
3.8%. With the bigger than expected decrease, the unemployment rate fell to its
lowest level since hitting 3.5% in December of 1969. Average hourly employee
earnings rose by $0.08 or 0.3% to $27.24 in September, reflecting a
year-over-year increase of 2.8%. A separate report from the Commerce Department
showed that the US trade deficit widened in August, reflecting an increase in
imports and a decrease in exports. The Commerce Department said the trade
deficit widened to $53.2 billion in August from a revised $50.0 billion in
July. Dow
Jones Industrial Average declined 180.43 points or 0.68 percent to 26,447.05,
Nasdaq slipped 91.06 points or 1.16 percent to 7,788.45 and the S&P 500 was
down by 16.04 points or 0.55 percent to 2,885.57.
Giving up most of the early
gains, crude oil futures ended almost flat on Friday as prospects of possible
drop in supply post implementation of sanctions on Iran from early November
weighted down on investors' sentiments. The decision of Russia and Saudi Arabia
to increase output till December also added pressure on crude oil prices.
According to an S&P Global Platts survey of analysts, industry officials
and shipping data released on Friday showed that the Organization of the
Petroleum Exporting Countries (OPEC) 15 members raised their crude-oil output
in September to 33.07 million barrels a day- a 180,000-barrel-a-day rise from
August. Traders were looking ahead for the weekly oil rig count report from
Baker Hughes. Benchmark crude oil futures for November tacked on a penny to
settle at $74.34 a barrel on the New York Mercantile Exchange. December Brent
crude slipped 42 cents or 0.5 percent to settle at $84.16 a barrel on London's
Intercontinental Exchanged.
Falling
for the fourth consecutive session, Indian rupee plunged to a fresh record
closing low against the US dollar on Friday, after Reserve Bank of India (RBI)
kept its key rates unchanged. Traders remain concerned about Union minister
Nitin Gadkari's statement that the country is facing lot of economic crisis due
to crude oil imports and need to reduce imports and increase exports. Some
cautiousness also crept in with a private report indicating that amidst the
erratic distribution of monsoon rains and with the possibilities of as many as
254 districts facing drought like situation, the total kharif cereals
production likely to decline marginally by 1.71% compared to last kharif.
However, the local currency recovered from its all-time low of 74.23 in final
hours, as some relief came with a report that salaries in the country are
projected to increase by 10% in 2019, the highest in the Asia Pacific region.
On the global front, dollar's rally took a pause on Friday as investors awaited
monthly US jobs data later in the day and evaluated the impact of a two-day
global government bond rout that has lifted US Treasury yields to seven-year
highs. Finally, the rupee ended at 73.76, 18 paise weaker from its previous
close of 73.58 on Thursday.
The FIIs as per Friday's data
were net sellers in equity and debt segments both. In equity segment, the gross
buying was of Rs 5780.03 crore against gross selling of Rs 8040.85 crore, while
in the debt segment, the gross purchase was of Rs 323.73 crore with gross sales
of Rs 821.05 crore. Besides, in the hybrid segment, the gross buying was of Rs
1.19 crore against gross selling of Rs 1.62 crore.
The US markets declined on Friday
after strong US jobs numbers signaled a continued tightening of the labor
market and increased inflation pressures, while Treasury yields rose again to
multi-year highs. Asian markets were trading mostly in red on Monday as
investors waited with bated breath as China's markets prepare to reopen
following a week-long holiday and after its central bank cut banks' reserve
requirements in a bid to support growth. The Indian markets continued their
weak trade for second straight session to end near intra-day low level on
Friday after the Reserve Bank of India (RBI) kept its repo rate unchanged at
6.5%, surprising street who had expected a 25-bps rate hike to defend the
falling rupee. Today, the markets are likely to pessimistic start tracking
negative cues from other Asian markets. Traders will be concerned about Exporters'
body Federation of Indian Export Organisations' (FIEO) statement that the rupee
depreciation is increasing the cost of imported capital goods, inputs and
various services used by exporters paid in foreign currency, particularly the
freight charges. Traders will also be reacting to the Reserve Bank of India's
(RBI) statement that the Centre and states should stick to the fiscal deficit
target as any slippage will have an adverse bearing on inflation and increase
market volatility. There will be some cautiousness with a private report that
foreign investors have pulled out over Rs 9,300 crore ($1.3 billion) from the
Indian capital markets in the last four trading sessions on unabated fall in
rupee and rise in crude oil price. Also, another private report said that the
share of private investments in the infrastructure sector has fallen to a
decadal low of around 25% in FY18 steeply down from a high of 37% in FY08.
However, traders may get some support with the World Bank in its latest report
on South Asia saying that growth in India is firming up and projected to
accelerate to 7.3% in the 2018-19 fiscal and 7.5% in the next two years.
Besides, Union Finance Minister Arun Jaitley has promised more steps to cut the
current account deficit (CAD) and bolster foreign exchange inflows, seeking to
calm frayed nerves amid a stock market crash and falling rupee.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,316.45
|
10,205.35
|
10,484.10
|
BSE Sensex
|
34,376.99
|
34,013.29
|
34,929.61
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Hindustan Petroleum Corporation
|
869.02
|
165.10
|
153.58
|
186.03
|
Indian Oil Corporation
|
808.85
|
118.05
|
106.77
|
127.82
|
Bharat Petroleum Corporation
|
557.20
|
265.30
|
236.55
|
296.05
|
Yes Bank
|
405.47
|
206.00
|
199.90
|
215.30
|
State Bank of India
|
366.29
|
258.35
|
252.57
|
267.57
|
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