Indian equity bourses bounced
back in green terrain on Friday after yesterday's drubbing, with Sensex &
Nifty closing higher by over 0.60% each. The start of the day was firm, aided
with Union Finance Minister Nirmala Sitharaman's statement that the government
is giving sector-specific solutions to fight the slowdown in economic growth.
Hinting at other measures like steps to improve exports, easing credit, making
more money available by early repayments to vendors and front-loading of banks
recapitalisation, Sitharaman said the government has been working on
sector-specific measures. But, volatility hit markets in noon deals, as Ind-Ra
slashed India's GDP growth forecast for FY20 to 6.1% for the second time in two
months. Despite some volatility, key benchmarks managed to trade in green,
taking support with an EEPC India's analysis report showing that India's
engineering exports to China have gone up by an annualised 58 per cent in
August, 2019, bucking the trend of drop in overall exports to the world market.
Some support also came with reports that the government set up a high-level
committee of officers to look into revenue shortfall being faced by the states
and suggest measures for augmenting collections. Separately, India jumped two
levels to 7th position in the Brand Finance Nation ranking of 2019 despite the
reduction in the overall economic growth due to slowdown in the manufacturing
and construction sectors. Finally, the BSE Sensex gained 246.68 points or 0.65%
to 38,127.08, while the CNX Nifty was up by 70.50 points or 0.63% to 11,305.05.
The US markets ended higher with
gains of over one percent on Friday as traders expressed continued optimism
about US-China trade talks, with President Donald Trump announcing that the two
economic superpowers have reached a very substantial phase one deal. Trump said
the deal includes up to $40 to $50 billion in Chinese purchases of US
agricultural products as well as Chinese concessions on intellectual property
and financial services. In exchange for the concessions by China, the US has
agreed to hold off on an increase in tariffs originally scheduled for next
week. Trump said the agreement will take about three weeks to write and would
likely be signed by both sides by the Asia-Pacific Economic Cooperation summit
in Chile in November. On the economic front, a report released by the Labor
Department showed an unexpected increase in US import prices in the month of
September, although the report also showed an unexpected decrease in export
prices. The Labor Department said import prices rose by 0.2 percent in
September after dipping by a revised 0.2 percent in August. Meanwhile, the
report said export prices slipped by 0.2 percent in September after sliding by
0.6 percent in August. Export prices had also been expected to come in
unchanged. Besides, with consumers anticipating larger income gains and lower
inflation during the year ahead, the University of Michigan released
preliminary data unexpectedly showing a continued improvement in US consumer
sentiment in the month of October. The report said the consumer sentiment index
climbed to 96.0 in October after rising to 93.2 in September. The continued
increase surprised participants, who had expected the index to drop to 92.0.
The consumer sentiment index continued to recover after plummeting to a nearly
three-year low of 89.8 in August. Dow Jones Industrial Average rose 319.92
points or 1.21 percent to 26816.59, Nasdaq gained 106.27 points or 1.34 percent
to 8057.04 and S&P 500 was up by 32.14 points or 1.09 percent to 2970.27.
Extending previous session's
gains, crude oil futures ended higher with gains of over two percent on Friday
on supply concerns after an Iranian oil tanker exploded in the Red Sea after
being hit by missiles launched from the Saudi Arabian port of Jeddah. Besides,
oil prices also got support after reports that the US and China has reached an
agreement to ease trade tensions that includes the elimination of at least some
planned tariffs. Meanwhile, the International Energy Agency (EIA) in a monthly
report has said it expects global demand growth of 1 million barrels a day in
2019 and 1.2 million barrels a day, in the following year. IEA attributed the
downgrades of roughly 100,000-a-barrel-a-day from previous estimates for demand
that has shaped up to be the weakest since 2016, following evidence of a
slowdown in several major consuming regions and countries, including Europe,
India, Japan, Korea and the US. Benchmark crude oil futures for November surged
$1.15 or 2.2 percent to settle at $54.70 a barrel on the New York Mercantile
Exchange. December Brent rose $1.41 or 2.4 percent to settle at $60.51 a barrel
on London's Intercontinental Exchange.
Indian
rupee pared most of its early gains but still ended marginally higher against
dollar on Friday, driven by weakening of the greenback in overseas markets.
Traders found some solace with Union Finance Minister Nirmala Sitharaman's
statement that the government is giving sector-specific solutions to fight the
slowdown in economic growth. But most of the gains were trimmed as anxiety
remained among the traders with India Ratings and Research (Ind-Ra) slashing
the country's gross domestic product (GDP) forecast for current fiscal year
(FY20) to 6.1% for the second time in two months. Traders were also looking forward
to the index of industrial production (IIP) data for August scheduled to be
announced after the market hours. On the global front, Pound rose against the
Dollar for a second consecutive session Friday after British and Irish Prime
Ministers said they can see a path toward a long elusive Brexit deal, prompting
Deutsche Bank to walk away from a bet against Sterling, which is also
benefiting from hopes of a deal between the U.S. and China. Finally, the rupee
ended at 71.02, 5 paise stronger from its previous close of 71.07 on Thursday.
The
FIIs as per Friday's data were net sellers in both equity and debt segments. In
equity segment, the gross buying was of Rs 4823.78 crore against gross selling
of Rs 4903.60 crore, while in the debt segment, the gross purchase was of Rs
665.88 crore with gross sales of Rs 1460.14 crore. Besides In the hybrid
segment, the gross buying was of Rs 6.00 crore against gross selling of Rs 7.88
crore.
The US markets ended higher on
Friday after President Donald Trump said China and the US reached the first
phase of a substantial trade deal that delays tariff hikes that were set to
kick in next week. Asian markets are trading in green on Monday as sentiment
improved following last week's high-level trade negotiations between the US and
China. Indian markets ended with modest gains on Friday led by gains in IT,
metal and auto stocks, amid positive global cues. Today, the start of new week
is likely to be cautious amid weak industrial growth data and economic growth
concerns. The National Statistical Office (NSO) data showed that India's
factory output shrank by 1.1% in August, recording the poorest performance in
seven years due to a sharp decline in production of capital goods and consumer
durable. Industrial production growth for the first time in more than two years
has treaded into negative territory. Besides, the World Bank slashed its growth
forecast for India's current fiscal year to 6%, down from 7.5%, warning that
the severe slowdown could further weaken the country's stuttering financial
sector. Market participants will be looking ahead to the wholesale price (WPI)
and consumer price (CPI) inflation prints for September to be released later in
the day. Traders will be concerned with report that foreign portfolio investors
withdrew over Rs 6,200 crore from Indian capital markets in the first two weeks
of October, as global recession fears and trade war concerns weighed on
sentiments. Also, there will be some cautiousness as the International Monetary
Fund looks at India as a country that recognizes the need for an
environmentally sustainable development strategy as the global community gears
up for a decisive fight against climate change. However, some support may come
later in the day with firm global cues. Investors may take note of report that
the country's foreign exchange reserves surged by $4.24 billion to touch a
record high of $437.83 billion in the week to October 4. Meanwhile, Finance
Minister Nirmala Sitharaman will hold a review meeting with CEOs of public
sector banks (PSBs) to discuss various issues, including progress on credit
offtake, as part of efforts to prop up the economy. Banking stocks will be in
focus with the Reserve Bank of India's (RBI) data showing that for the first
time this fiscal, bank credit growth slowed to single-digit, printing in at a
low 8.79 percent at Rs 97.71 lakh crore in the fortnight to September 27. There
will be some buzz in the insurance stocks with report that life insurance
companies saw a 35.1 percent year-on-year growth in new premium collections, to
Rs 1.26 lakh crore in the April to September (H1FY20) period. Also, there will
be some reaction in fertilisers stocks as leading fertiliser cooperative IFFCO
reduced the retail prices of its complex fertilisers, including Di-Ammonium
Phosphate (DAP), by up to Rs 50 per bag, amid easing raw materials and
manufactured fertilisers prices globally. There will be some earnings
announcements also to keep the markets buzzing.
Support and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,305.05
|
11,208.67
|
11,382.17
|
BSE Sensex
|
38,127.08
|
37,794.82
|
38,402.38
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
3,394.79
|
39.60
|
37.07
|
42.07
|
SBI
|
432.72
|
254.55
|
250.23
|
260.13
|
Tata Motors
|
410.28
|
121.30
|
118.30
|
123.25
|
ITC
|
250.72
|
243.95
|
241.30
|
246.40
|
Infosys
|
206.36
|
814.80
|
786.33
|
833.53
|
Tata Steel's crude steel production has increased by 4.65 per cent to 4.5 MT in Q2FY20 as against 4.3 MT in the corresponding quarter last fiscal.
IOC and ONGC have signed Crude Oil Sales Agreement for North East on October 1, 2019 at New Delhi.
Infosys has reported a fall of 1.78% in its consolidated net profit at Rs 4037 crore for Q2FY20 as compared to Rs 4110 crore for Q2FY19.
HDFC and Arvind SmartSpaces have set up a Rs 250 crore fund to develop affordable and mid-income housing projects.