Thursday turned out to be a
fabulous day for Indian markets, as Sensex & Nifty logged gains of around
300 & 100 points, respectively. The start of the day was firm, aided with
the commerce & industry ministry data showing that foreign direct
investment into India grew 15% to $26 billion during the first half of the
current financial year. Inflow of FDI during April-September of 2018-19 stood
at $22.66 billion. Adding more comfort, Goods & Services Tax revenue
collection remained above Rs 1 lakh crore mark for the second month in a row
with December mop-up rising to Rs 1.03 lakh crore as compared to the year-ago
period. Bulls held their tight grip over the markets for the whole day, after
Indian manufacturing industry saw a solid rise in their activities in the month
of December 2019, on account of rising new orders and output. As per the survey
report, the Nikkei India Manufacturing Purchasing Managers' Index surged to
52.7 in December from 51.2 in November. Traders remained positive with a
private report stating that private equity investments in the country are
expected to grow 15-20 per cent in 2020 as investors pin hopes on the country's
long growth potential after a blockbuster year when credit flow through regular
channels turned slow. Finally, the BSE Sensex gained 320.62 points or 0.78% to
41,626.64, while the CNX Nifty was up by 99.70 points or 0.82% to 12,282.20.
Extending the substantial upward
move seen last year, the US markets ended at new record highs on the first
trading day of 2020. Traders continued to express optimism about the potential
impact of a phase one US-China trade deal, with President Donald Trump saying
the deal is due to be signed during a White House ceremony on January 15. Trump
said on Tuesday that he would travel to Beijing at a later date to begin talks
on phase two of a trade agreement. Recent reports have indicated Chinese Vice
Premier Liu He, Beijing's top trade negotiator, will be on hand to sign the
phase one deal. The US economy has held up relatively well in the face of the
US-China trade war, and the signing of the phase one deal could lift some of
the lingering uncertainty hanging over some industries. Financial markets in
the US were closed Wednesday for New Year's Day. The Labor Department released
a report showing initial jobless claims unexpectedly edged slightly lower from
an upwardly revised level in the week ended December 28. The report said
initial jobless claims slipped to 222,000, a decrease of 2,000 from the
previous week's revised level of 224,000. Street had expected jobless claims to
inch up to 225,000 from the 222,000 originally reported for the previous week.
Besides, sentiments were lifted after the People's Bank of China lowered the
amount of reserve cash the country's banks must hold, which will put more money
into the economy. This move will inject about 800 billion yuan in liquidity to
the Chinese economy.
Crude oil futures ended higher on
Thursday as traders eyed developments in the Middle East and weighed prospects
for crude supply disruptions in the region. Oil Prices traded higher, following
an attempt by supporters of Iran-backed militias to storm the US Embassy on
Tuesday. Protesters subsequently withdrew from the area. The US took steps to
boost security at the embassy, sending Marines from neighboring Kuwait and
moving to deploy an infantry battalion of around 750 solders to the region.
Besides, oil prices also found some support after China's central bank said
that it would provide a further shot of stimulus to the economy, which may
boost the potential for energy demand. Crude oil futures for February added 12
cents or 0.2 percent to settle at $61.18 a barrel on the New York Mercantile
Exchange. March Brent gained 25 cents or 0.4 percent to settle at $66.25 a
barrel on London's Intercontinental Exchange.
Indian
rupee ended weaker against the American currency on Thursday, amid sustained
rise in crude oil prices and foreign fund outflows. Sentiments remained
down-beat despite Indian manufacturing industry saw a solid rise in their
activities in the month of December 2019, on account of rising new orders and
output. As per the survey report, the Nikkei India Manufacturing Purchasing
Managers' Index (PMI) - a composite single-figure indicator of manufacturing
performance -surged to 52.7 in December from 51.2 in November. A strengthening
US dollar against major global currencies also affected rupee's trading
pattern, while an encouraging rally in domestic equities kept the downside in
check. On the global front, dollar snapped a six-day losing streak to add 0.2
per cent on Thursday, the first trading day of 2020, pushing the euro off
five-month highs while the offshore yuan shrugged off reserve ratio cuts that
could add $115 billion worth of liquidity. Finally, the rupee ended at 71.38,
16 paise weaker from its previous close of 71.22 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
722.07 crore against gross selling of Rs 363.04 crore, while in the debt
segment, the gross purchase was nil with gross sales of Rs 1.45 crore .Besides,
in the hybrid segment, the gross buying was of Rs 2.46 crore against gross
selling of Rs 0.03 crore.
The US markets ended at record
highs on Thursday as traders continue to express optimism about the potential
impact of a phase one US-China trade deal. Asian markets are trading mostly in
green on Friday following overnight gains on Wall Street. Indian markets ended
higher on Thursday led by a surge in metals and infrastructure stocks, amid
expansion in manufacturing activity to a 7-month high in December. Today, the
markets are likely to make a cautious start amid reports of surge in crude oil
prices. As per reports, oil prices jumped more than $1 on Friday after a US
airstrike killed key Iranian and Iraqi military personnel, raising concerns
that escalating Middle East tensions may disrupt oil supplies. There will be
some cautiousness with another private report indicating that India's real GDP
growth would weaken further in Q3 of the financial year due to slow economic
activity in the first two months of the second half and the GDP for FY20 could
be around 4.5%. Besides, think-tank Centre for Monitoring Indian Economy (CMIE)
stated that India's unemployment rate increased to 7.7% in December, slightly
higher than 7.48% reported in the previous month. However, some support may
come later in the day with report that the Reserve Bank of India (RBI) on
January 6 will carry a special simultaneous open market operation to buy and
sell government bonds of Rs 10,000 crore each. On a review of the current
liquidity and market situation and an assessment of the evolving financial
conditions, the RBI has decided to conduct simultaneous purchase and sale of
government securities under Open Market Operations (OMO). Traders may take note
of the RBI's report that banks' credit and deposits grew by 7.10 percent and
10.09 percent to Rs 99.47 lakh crore and Rs 130.08 lakh crore in the fortnight
ended December 20. There will be some buzz in the infrastructure stocks as
ratings agency ICRA maintained a cautious stance on the road sector, even as
the government has decided to invest Rs 102 lakh crore from fiscal 2020-2025 in
modernising infrastructure. There will be some reaction in sugar stocks with
Indian Sugar Mills Association's (ISMA) statement that the country's sugar
production has fallen sharply by 30.22% to 7.79 million tonne in the first
three months of current marketing year ending September, but ex-mill prices
have remained stable so far, helping mills clear cane payment to farmers on
time.
Support and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
12,282.20
|
12,221.67
|
12,316.32
|
BSE Sensex
|
41,626.64
|
41,420.30
|
41,741.14
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
1,222.43
|
47.35
|
46.33
|
48.43
|
Tata Motors
|
572.90
|
193.75
|
187.33
|
197.43
|
Tata Steel
|
216.75
|
484.85
|
475.30
|
491.10
|
SBI
|
203.24
|
339.30
|
335.15
|
341.65
|
Vedanta
|
171.38
|
159.45
|
156.55
|
161.10
|
Tata Motors has reported domestic sales of 44,254 units for December 2019, as compared to 50,440 units for December 2018, posting a decline of 12%.
Coal India has reported rise in its production by 7.2% to 58.02 million tonnes in December 2019.
NTPC has decided to procure and use 6 million tonnes of agro residue-based pellets to co-fire its power plants along with coal in 2020.
Bajaj Auto has registered a fall of 3% in total sales to 336,055 units in December 2019 against 346,199 units in December 2018.