Bulls took charge on Dalal Street
on Thursday, as both Sensex and Nifty, ended the trading session with the
strong gains of over 1.50% each. The markets made a fabulous start of the day,
after SBI Research's latest report indicated that the government is likely to
meet the fiscal deficit target this year and pegged fiscal deficit at Rs 6.72
trillion or 3.2% of gross domestic product (GDP) for next fiscal year
(2019-20), assuming a moderate nominal GDP growth of 11.7%. It added that the
fiscal gap will be met at the budgeted 3.3 percent for FY19. Traders took
encouragement with Commerce Minister Suresh Prabhu's statement that the
government will release the new e-commerce policy soon which is awaiting
approval from the Department of Industrial Policy and Promotion (DIPP). The
street also took note of report that Indian companies' foreign borrowing nearly
trebled to $3.81 billion in December 2018 as compared to the same period last
year. According to data from the Reserve Bank of India (RBI), of the total borrowing
amount in December, $3.77 billion was mobilized through external commercial
borrowings (ECBs) in the overseas markets, while $37.04 million was through
rupee-denominated bonds (RDBs). The markets extended their gains in the second
half of the session to settle near their intraday high points, mirroring
positive European markets. Intense buying by the traders ahead of expiry of
January futures & options contracts, also contributed to the gaining
momentum. The markets participants were seen taking support from a report that
the GST officials are working out mechanism to prompt taxmen to initiate
profiteering complaints, which could be taken up for further investigation by
the Directorate General of Anti-Profiteering. The street paid no heed towards
the National Sample Survey Office's (NSSO) latest report showing that India's
unemployment rate reached to 6.1% in 2017-18, hitting a 45-year high. The rate
was the highest since 1972-73. Investors also shrugged off Fitch Ratings'
latest report warning of a second consecutive year of fiscal slippage in the
event of Finance Minister Piyush Goyal resorting to populist spending to win
over lost vote base. Finally, the BSE Sensex gained 665.44 points or 1.87% to
36,256.69, while the CNX Nifty was up by 179.15 points or 1.68% to 10,830.95.
The US markets ended mostly
higher on Thursday, with the S&P 500 notching its best January in over
three decades, after the Federal Reserve signaled that rate increases are on
pause and that its next policy move will depend on economic data. For the
month, the S&P 500 climbed 7.9% for its best January since 1987, while the
Dow rose 7.2%, its best January since 1989. The Nasdaq had its best January
since 2001 on the back of a 9.7% monthly gain. Meanwhile, traders were watching
developments between the US and China as officials there attempted to forge the
framework toward a resolution of tariff disputes in the final day of this round
of negotiations. President Donald Trump said that no final deal would be made
until my friend President Xi, and I meet in the near future to discuss and
agree on some of the long standing and more difficult points. On the economic
front, the Labor Department released a report showing a significant rebound in
initial jobless claims in the week ended January 26. The report said initial
jobless claims surged up to 253,000, an increase of 53,000 from the previous
week's revised level of 200,000. With the much bigger than expected increase,
jobless claims reached their highest level since hitting 254,000 in September
of 2017. The slightly upwardly revised reading on jobless claims in the
previous week was still the lowest since a matching figure in October of 1973.
Meanwhile, a separate report from the Commerce Department showed new home sales
rebounded by much more than anticipated in November. The report released showed
new home sales soared by 16.9 percent to an annual rate of 657,000 in November
after plunging by 8.3 percent to a revised rate of 562,000 in October. Nasdaq
gained 98.66 points or 1.37 percent to 7281.74 and S&P 500 was up by 23.05 points
or 0.86 percent to 2704.10, while Dow Jones Industrial Average declined 15.19
points or 0.06 percent to 24999.67.
Crude oil futures ended lower on
Thursday on the back of profit booking, but still finished the month with an
18% gain-the strongest monthly rise in nearly three years. The upbeat tone for
continued a day after weekly US crude supplies were reported up less than
expected and amid continued reaction to US sanctions on Venezuela's state-run
oil company, all of which helped to lift US benchmark prices higher. Meanwhile,
the oversupply narrative from US production will likely be more relevant after
winter, but it should still cap any rallies that target $60 to $70 range.
Benchmark crude oil futures for March declined 44 cents or 0.8 percent to
settle $53.79 a barrel on the New York Mercantile Exchange, while March Brent
crude rose 24 cents or 0.4 percent to settle at $61.89 a barrel on London's
Intercontinental Exchange.
Indian
rupee, after making a good start, gave away most of its gains to end marginally
higher against dollar on Thursday, driven by weakening of the greenback in
overseas markets. Local currency got some support with SBI Research's report
that the government meeting the fiscal targets this year and for FY20, fiscal
deficit is likely to be Rs 6.72 trillion or 3.2 percent of GDP, assuming a
modest 11.7 percent of nominal GDP growth. It added that for FY19 the fiscal
gap will be met at the budgeted 3.3 percent. A spectacular relief rally in
local equities also supported the forex sentiment. However, local unit cut most
of the early gains, as anxiety remained among the traders with the National
Sample Survey Office's (NSSO) latest report showing that India's unemployment
rate reached to 6.1% in 2017-18, hitting a 45-year high. The rate was the
highest since 1972-73. On the global front, dollar weakened on Thursday after
the Federal Reserve pledged to be patient with further interest rate hikes, a
move that lifted the euro and the Australian dollar. Finally, the rupee ended
at 71.08, 4 paise stronger from its previous close of 71.12 on Wednesday.
The FIIs as per Thursday's data
were net buyers in equity segment, while they were net sellers in debt segment.
In equity segment, the gross buying was of Rs 6884.34 crore against gross
selling of Rs 6650.71 crore, while in the debt segment, the gross purchase was
of Rs 1013.75 crore with gross sales of Rs 1447.82 crore. Besides, in the
hybrid segment, the gross buying was of Rs 0.03 crore against gross selling of
Rs 0.10 crore.
The US markets ended mostly
higher on Thursday as strong earnings and a Federal Reserve indicating it will
pause rate hikes caused boosted investors sentiments. Asian markets are trading
mostly in green on Friday on the back of optimism on the US-China trade front.
Snapping four-day losing streak, Indian markets ended significantly higher on
Thursday tracking strength in Asian peers as a dovish stance by the Federal
Reserve boosted sentiment. Today, the start is likely to be optimistic, on the
day of interim Budget 2019, on the back of supportive global cues. Investors
will be eyeing manufacturing PMI data to be out later in the day. There are
expectations that Budget may focus on an income support scheme for distressed
farmers who have seen their incomes stagnate because of plunging prices, barely
enough to pay for loans and input costs. Traders will be getting encouragement
with the finance ministry's statement that revenue collection from Goods and
Services Tax (GST) witnessed a substantial jump, crossing Rs 1 lakh crore in
January from Rs 94,726 crore in December. It said this increase has been
achieved despite various tax relief measures implemented by the GST Council to
lower the tax burden on the consumers. Meanwhile, the government revised the
Gross Domestic Product (GDP) growth rates by 110 basis points from 7.1 per cent
to 8.2 per cent for 2016-17 and by 50 basis points from 6.7 per cent to 7.2 per
cent for fiscal 2017-18. However, some cautiousness may be there as growth in
the eight core sectors of the economy continued to tumble, crashing to an
18-month low of 2.6 per cent in December, down from the 3.4 per cent growth in
November. There will be some buzz in the aluminium industry stocks with Union
Mines Secretary Anil Mukim's statement that the Indian aluminium industry must
slash production costs and raise output to tackle the global downturn. The auto
sector stocks will also be in action, reacting to their monthly sales numbers.
There will be lots of important earnings announcements too, to keep the markets
in action.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,830.95
|
10,726.98
|
10,886.48
|
BSE Sensex
|
36,256.69
|
35,905.13
|
36,443.19
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
ICICI Bank
|
859.17
|
364.45
|
353.48
|
376.03
|
Yes Bank
|
677.95
|
194.10
|
188.68
|
200.98
|
NTPC
|
366.96
|
139.70
|
138.73
|
140.93
|
Axis Bank
|
352.40
|
722.70
|
698.88
|
736.68
|
IOC
|
323.33
|
136.85
|
133.30
|
139.35
|
Hero MotoCorp has set-up its first Research and Development center at a global location - the Hero Tech Center Germany GmbH.
L&T's wholly-owned subsidiary -- LTHE has won two significant orders from Indian Oil Corporation.
Tata Steel-owned rebar brand Tata Tiscon has achieved 100% roll out of its latest grade of steel called SD – super ductile rebar in India.
IOC has reported 90.91% fall in its net profit at Rs 716.82 crore for Q3FY19 as compared to Rs 7,883.22 crore for Q3FY18.