Monday turned-out to be a
disappointing day of trade for Indian equity benchmarks, where frontline gauges
lost around a percentage point to end below their crucial 33,800 (Sensex) and 10,400
(Nifty) levels. After making a pessimistic start, domestic gauges traded in red
terrain throughout the day, as traders remained concerned with US President
Donald Trump's statement that he would impose tariffs on imports of steel and
aluminium products, in a move he said would protect US industry. Sentiments
remained dampened with report that activity in India's service industries
contracted in February for the first time since November as rising price
pressures led to a decline in new businesses orders. The seasonally adjusted
Nikkei India Services Business Activity Index fell from 51.7 in January to 47.8
in February, its lowest level since August. Adding to the pessimism, foreign
investors have pulled out more than Rs 11,000 crore from Indian stocks in
February 2018 amid better opportunities in other emerging markets. This is the
largest outflow in five months. However, the total inflow by foreign portfolio
investors (FPIs) in the Indian equity markets stood at Rs 13,781 crore in
January 2018. Traders failed to get any sense of relief with Finance Minister
Arun Jaitley's statement that India would retain its position of fastest
growing economy in the coming decades, like China did in the last three
decades. He said, the way the situation in the world is changing there is a
great opportunity that has come in the way of India. Market participants also
overlooked report that the BJP expanded its foothold in northeast with its
stunning victory in Tripura polls and improved performance in Meghalaya and Nagaland
elections, boosting its prospects for 2019 Lok Sabha polls. Finally, the BSE
Sensex tumbled 300.16 points or 0.88% to 33,746.78, while the CNX Nifty was
down by 99.50 points or 0.95% to 10358.85.
The US markets closed higher on
Monday, with the Dow Jones Industrial Average bouncing back from a four-session
losing streak, as investors looked beyond the threat of a global trade war and
instead focused on positive economic data. A technical rebound following a
stretch of weakness for equities also helped to support broad market gains. On
the economy front, growth in China's services sector pulled back in February
but remained in sight of the almost six-year high recorded in January. The
Caixin-Markit services purchasing managers' index dipped to 54.2 in February
from 54.7 in the previous month, a 68-month high. That kept the reading well
above the 50-point line separating expansion from contraction. Companies
reported solid sales while hiring in the services sector offset a fall in
headcounts at manufacturers. The services gauge, combined with the improved
51.6 reading for the country's manufacturing sector, resulted in a composite
PMI of 53.3, down from the seven-year high in January of 53.7. Separately, US
services sector activity slowed slightly in February, held back by a sharp pull
back in employment growth, but a surge in new orders to a twelve and a half
year high pointed to underlying strength. The ISM said its non-manufacturing
activity index slipped 0.4 point to a reading of 59.5 last month. The Dow Jones
Industrial Average added 336.7 points or 1.37 percent to 24,874.76, the Nasdaq
gained 72.839 points or 1.00 percent to 7,330.70, and the S&P 500 was up by
29.69 points or 1.10 percent to 2,720.94.
Crude oil futures edged higher on
Monday, amid reports that Libya is suffering supply interruptions. A major
pipeline went down on March 4, the second important Libyan installation to go
down in the past few weeks. Also, traders weighed comments from the
International Energy Agency (IEA) on U.S. production and global demand growth.
The IEA forecasted that the U.S. would become the world's top crude producer by
2023 with production hitting a record of 12.1 million barrels a day. The IEA
said that rising oil production from the U.S. alone will need to cover 80% of
the world's demand growth over the next two years, with U.S. output set to grow
by 3.7 million barrels per day over the next five years. Benchmark crude oil
futures for April delivery rose $1.32 cents or 2.2 percent at $62.57 a barrel
on the New York Mercantile Exchange. May Brent crude gained $1.17 or 1.8
percent to settle at $65.54 a barrel on London's Intercontinental Exchange.
Indian
rupee pared most of its early gains but still ended higher against the dollar
on Monday, due to selling of the American currency by exporters and banks.
Traders took some support with Finance Minister Arun Jaitley's statement that
India would retain its position of fastest growing economy in the coming
decades, like China did in the last three decades. He said, the way the
situation in the world is changing there is a great opportunity that has come
in the way of India. However, gains were capped as some concern came with the
report that foreign investors have pulled out more than Rs 11,000 crore from
Indian stocks in February 2018 amid better opportunities in other emerging
markets. This is the largest outflow in five months. Besides, heavy selling in
the domestic equity markets also weighed on the sentiments. On the global
front, US dollar fell against yen on Monday amid continued concerns over US
protectionism. Finally, the rupee ended at 65.10, 5 paise stronger from its
previous close of 65.15 on Thursday.
The FIIs as per Monday'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 5684.01 crore against gross
selling of Rs 5260.22 crore, while in the debt segment, the gross purchase was
of Rs 1071.83 crore with gross sales of Rs 2190.16 crore. Besides, in the
hybrid segment, the gross buying was of Rs 3.37 crore against gross selling of
Rs 3.33 crore.
The US markets closed higher on
Monday ahead of the Labor Department's monthly employment report due to be
released on Friday. Asian markets were trading mostly in green after U.S.
President Donald Trump faced growing pressure from political allies to pull
back from proposed steel and aluminum tariffs, easing investor worries about an
imminent trade war. Indian equity markets ended lower for fourth straight
session on Monday, as weak global cues overshadowed the BJP's spectacular
performance in recently-held elections in three North Eastern states. Today,
the markets are likely to make an optimistic start following firm global cues.
Traders will be getting some support with report that the economy will grow up
to 7.5 per cent in FY19, supported by domestic consumption, policy push, and
synchronised global growth. In the current fiscal, GDP growth is expected to be
6.5 per cent. The Economic Survey 2018 has pegged FY19 growth at 7-7.5 per
cent. Some support will also come with report that the Centre will constitute a
group to suggest necessary changes in the policy for special economic zones
(SEZs). Designed to facilitate exports, units in SEZs get certain fiscal and
non-fiscal incentives such as no licencing required for imports and full
freedom of sub-contracting, as well as direct and indirect tax benefits. Market
participants may also get support with report that the Reserve Bank of India
(RBI) will inject Rs 1 lakh crore short term money into the banking system
ahead of the financial year-end that normally sees cash crunch. The move is likely to keep short term rates
under check benefiting borrowing companies. Stocks related to steel sector will
be buzzing on report that export of steel to the US from various countries is
likely to fall by 9-14 million tonne(MT) as Trump government decides to impose
higher tariff on import of steel and aluminium. There will be buzz in stocks
related to apparel on report that the pace of growth in country's apparel
exports will depend on the industry's ability to wade through the new taxation
and export incentive regime and intense global competition.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous
close
|
Support
|
Resistance
|
NSE
Nifty
|
10,358.85
|
10,312.27
|
10,417.07
|
BSE
Sensex
|
33,746.78
|
33,588.70
|
33,969.57
|
Nifty Top volumes
Stock
|
Volume
|
Previous
close (Rs)
|
Support (Rs)
|
Resistance
(Rs)
|
(in
Lacs)
|
SBI
|
184.85
|
263.50
|
259.83
|
266.08
|
Tata
Motors
|
146.65
|
352.05
|
345.18
|
363.83
|
ICICI
Bank
|
144.56
|
303.35
|
299.60
|
306.80
|
Hindalco
Industries
|
124.25
|
229.60
|
226.53
|
234.33
|
Tata
Steel
|
97.85
|
655.90
|
648.70
|
666.20
|
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