Pausing three-day gaining streak,
Indian equity benchmarks ended Friday's session on lower note with losses of
more than half percent, following weak cues from other Asian markets. Markets
started the session in negative territory, as India Ratings (Ind-Ra) expects
most sectors to experience varying degrees of revenue contraction during FY21
due to demand and supply disruptions caused by the novel coronavirus, or
COVID-19, pandemic. Selling further crept in amid the Reserve Bank of India
(RBI) unexpectedly slashed benchmark interest rates to their lowest levels
since 2000 and extended the moratorium on repayment of bank for three months to
ramp up support for the economy which is likely to contract for the first time
in over four decades. The central bank, which advanced the monetary policy
committee (MPC) meeting for the second time since March, extended the
three-month moratorium of loan repayments, from June 1 to August 31 and raised
the limit on banks' group exposure to companies. Key bourses continued their
weak run in final hour of trade, as Moody's Investors Service said India's
economy is expected to contract for the first time in more than four decades
saying economic damage owing to the coronavirus-induced lockdown will be
significant with lower consumption and sluggish business activity. However,
markets managed to pared some initial losses as traders found some support with
Commerce and Industry Minister Piyush Goyal's statement that in order to make India
a self-reliant country and a global supplier, the government has recognised 12
sectors, including auto components, textiles, industrial machinery and
furniture, where attention would be given. Goyal said that a self-reliant India
will ensure production of quality products on a large scale, fulfil India's
requirements and encourage export of surplus production. Finally, the BSE
Sensex lost 260.31 points or 0.84% to 30,672.59, while the CNX Nifty was down
by 67.00 points or 0.74% to 9,039.25.
The US markets were closed on
Monday for the Memorial Day.
Indian rupee ended lower against
dollar on Friday, amid weakness seen in the domestic equity markets post
Reserve Bank of India (RBI) cut the repo rate. In the wake of COVID-19, the RBI
has reduced the policy repo rate under the liquidity adjustment facility (LAF)
by 40 basis points (bps) to 4.0 per cent from 4.40 per cent with immediate
effect. Traders remained cautious as India Ratings (Ind-Ra) expects most
sectors to experience varying degrees of revenue contraction during FY21 due to
demand and supply disruptions caused by the novel coronavirus, or COVID-19,
pandemic. Meanwhile, rising coronavirus cases in the country and US-China trade
tensions weighed on the local unit. On the global front, dollar gained against
major peers on Friday as worries about rising diplomatic tensions between the
United States and China supported safe-haven demand for the greenback. Finally,
the rupee ended at 75.95, 34 paise weaker from its previous close of 75.61 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 5981.04 crore against gross
selling of Rs 6187.25 crore, while in the debt segment, the gross purchase was
of Rs 951.33 crore with gross sales of Rs 789.43 crore. Besides, in the hybrid
segment, the gross buying was of Rs 12.85 crore against gross selling of Rs
10.89 crore.
The US markets were closed on
Monday for the Memorial Day holiday. Asian markets are trading in green on
Tuesday after American biotech firm Novavax said it started the first human
study of its experimental coronavirus vaccine. Indian markets, before going for
a long weekend holiday, ended lower on Friday as a slew of measures announced
by the Reserve Bank of India (RBI) to revive the economy failed to meet market
expectations. Indian equity markets remain closed on Monday for Eid-ul-Fitar.
Today, the start of week is likely to be optimistic following firm cues from
Asian peers. Traders will be getting encouragement with Niti Aayog Vice
Chairman Rajiv Kumar's statement that there is a need to convert development
into mass movement, and India should aspire to become second or third largest
economy in the world by 2047. Some
support will come with report that investments through participatory notes
(P-notes) in the domestic capital market increased to Rs 57,100 crore as of
April 30 after falling to over 15-year low at the end of the preceding month.
Also, a report stated that reversing their selling trend, foreign investors
have infused over Rs 9,000 crore into the Indian equity markets in May so far
amid attractive valuations of stocks and a mega block deal. Though, there may
be some cautiousness with report that amid global speculation that Covid-19 may
begin to tail off in the summer, India is witnessing its steepest jumps in
cases over the past few days, even as mercury across the country is on the
rise. India has witnessed an increase of over 5 per cent every day in the total
number of cases for the past nine days. The country witnessed 6,977 new
Covid-19 cases, taking the tally to 1,38,845. Traders may also be concerned as
Icra projected the economy to grow by 1.9 per cent in the fourth quarter
against 5.8 a year ago and 4.3 per cent in 2019-20 against 6.1 per cent in
2018-19. Meanwhile, the Central Board of Indirect Taxes (CBIC) said it has
sanctioned GST refund claims worth Rs 11,052 crore in 47 days. Metal stocks
will be in focus with the World Steel Association's report that India's crude
steel output declined over 65 per cent to 3.13 million tonnes (MT) during
April. There will be some reaction in power stocks with India Ratings' (Ind-Ra)
statement that even as the global economic slowdown and COVID crisis have
severely hit the steel industry, players engaged in supply of transmission and
distribution (T&D) equipment are expected to be more resilient mainly on
the back of government orders.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
9,039.25
|
8,955.33
|
9,136.38
|
BSE Sensex
|
30,672.59
|
30,395.68
|
31,028.71
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
State Bank of India
|
870.70
|
150.85
|
148.33
|
154.48
|
ICICI Bank
|
803.59
|
291.05
|
281.83
|
303.98
|
Axis Bank
|
483.68
|
336.95
|
326.62
|
353.52
|
ITC
|
390.14
|
186.35
|
183.33
|
190.63
|
Zee Entertainment
Enterprises
|
383.78
|
163.25
|
155.17
|
168.17
|
ONGC has entered into a Memorandum of Understanding with NTPC to set up a Joint Venture company for renewable energy business.
Bharti Airtel has acquired a strategic stake in Voicezen as part of its strategy to deliver a highly differentiated service experience to its customers.
Maruti Suzuki India has entered into a partnership with Cholamandalam Investment & Finance Company.
Bajaj Auto has reported a fall of 3.87% in its consolidated net profit attributable to owners of the company at Rs 1353.99 crore for Q4FY20 as compared to Rs 1408.49 crore for Q4FY19.