Indian equity markets resumed the
gaining rally on Wednesday, with Sensex and Nifty ending higher by around 225
and 50 points, respectively. After a negative start, key indices remained
lackluster during morning deals, amid a private report that the government may
discontinue spending on 200-odd schemes in order to stick to its fiscal deficit
target of 3.3 percent. Domestic sentiments remained pessimistic, as Fitch
Solutions raised India's fiscal deficit forecast to 3.6 percent of the GDP for
this fiscal year, from 3.4 percent previously, due to weak revenue collections
resulting from sluggish economic growth and government's sweeping corporate tax
rate cut. However, markets staged sharp recovery in noon deals to settle in
positive terrain, aided with Finance Minister Nirmala Sitharaman's statement
that the government will soon use its strong electoral mandate to usher in the
next wave of reforms, and not to miss the bus this time. Traders took
encouragement with Nasscom's statement that with the addition of more than
1,300 startups this year so far, India continues to reinforce its position as
the third-largest startup ecosystem in the world. Adding comfort, Commerce and
Industry Minister Piyush Goyal said that India's services sector has huge
potential to generate job opportunities and push country's gross domestic
product growth. Finally, the BSE Sensex gained 221.55 points or 0.55% to
40,469.78, while the CNX Nifty was up by 48.85 points or 0.41% to 11,966.05.
The US markets ended mostly lower
on Wednesday after a report said a meeting between President Donald Trump and
Chinese President Xi Jinping could be delayed until December. A senior Trump
administration official said discussions continue over terms of phase one of
the trade deal and a venue for a meeting between Trump and Xi. Sites in Europe
and Asia have been suggested for the meeting, with Sweden and Switzerland among
the possibilities, while Trump's suggestion of Iowa appears to have been ruled
out. The official said China's latest push for more tariff rollbacks was not
expected to derail progress toward an interim deal but noted that it was still
possible an agreement would not be reached. Besides, the choppy trading on
markets also came as traders seemed reluctant to make significant moves amid
some uncertainty about the near-term outlook for the markets after the recent
run to record highs. On the economic front, labor productivity in the US
unexpectedly edged lower in the third quarter, according to preliminary data
released by the Labor Department. The report said labor productivity dipped by
0.3 percent in the third quarter after spiking by an upwardly revised 2.5
percent in the second quarter. The drop in productivity came as a surprise to
participants, who had expected productivity to climb by 0.9 percent compared to
the 2.3 percent jump originally reported for the previous month. The unexpected
decrease in productivity, a measure of output per hour, came as output climbed
by 2.1 percent compared to a 2.4 percent increase in hours worked. Meanwhile,
the Labor Department said unit labor costs soared by 3.6 percent in the third
quarter after surging up by a downwardly revised 2.4 percent in the second quarter.
Street had expected unit labor costs to increase by 2.2 percent compared to the
2.6 percent spike originally reported for the previous month.
Snapping a three-day winning
streak, crude oil futures ended lower on Wednesday after US government data
revealed that domestic crude supplies rose for a second week in a row. The
Energy Information Administration (EIA) reported that US crude supplies climbed
by 7.9 million barrels for the week ended November 1. Crude supplies were
forecast to increase by 2.7 million barrels. The American Petroleum Institute
on Tuesday reported a rise of roughly 4.3 million barrels. Benchmark crude oil
futures for December dropped 88 cents or 1.5 percent to settle at $56.35 a
barrel on the New York Mercantile Exchange. January Brent fell $1.22 or 1.9
percent to settle at $61.74 a barrel on London's Intercontinental Exchange.
Indian
rupee ended weaker against the US dollar on Wednesday, on the back of
consistent demand for the greenback from state-run banks and importers.
Sentiments remained down-beat as Fitch Solutions raised India's fiscal deficit
forecast to 3.6 percent of the GDP for this fiscal year, from 3.4 percent
previously, due to weak revenue collections resulting from sluggish economic
growth and government's sweeping corporate tax rate cut. Market participants
paid no heed towards Finance Minister Nirmala Sitharaman's statement that the
government is eager to modify rules and boost investment in the infrastructure
space. She also said the government is focusing on real estate as part of a
broader plan to kick-start economic growth. On the global front, dollar held
its ground against other major currencies on Wednesday, supported by rising
hopes for a US-China trade deal and an improving outlook for the US economy.
Finally, the rupee ended at 70.97, 28 paise weaker from its previous close of
70.69 on Tuesday.
The
FIIs as per Wednesday's data were net buyers in both equity and debt segments.
In equity segment, the gross buying was of Rs 5446.94 crore against gross
selling of Rs 5047.95 crore, while in the debt segment, the gross purchase was
of Rs 1969.89 crore with gross sales of Rs 1748.20 crore. Besides, in the
hybrid segment, the gross buying was of Rs 9.71 crore against gross selling of
Rs 9.52 crore.
The US markets ended mixed on
Wednesday as markets weighed a report that an interim China-US trade deal could
be delayed until December and weakness in the energy sector underscored by disappointing
corporate quarterly results. Asian markets are trading mostly in red on
Thursday as reports of delays in sealing a preliminary Sino-US trade deal left
investors frustrated at the lack of concrete progress. Indian markets ended
higher on Wednesday, with Sensex settling at its new lifetime high of
40,469.78, led by robust gains in banking stocks. Today, the markets are likely
to make flat-to-positive start amid fall in crude oil prices and an Rs 25,000
crore booster dose to the real estate sector announced by Finance Minister.
Union Finance Minister Nirmala Sitharaman said the government has approved
setting up of an Rs 25,000 crore bailout fund to finance 1,600 stalled housing
projects as it looks to boost the economy by kick starting incomplete projects.
She said the government will establish a special window to provide priority
debt financing for completion of stalled housing projects in the affordable and
middle-income housing sector. Some support may also come with Petroleum
Minister Dharmendra Pradhan's statement that the government is on track to meet
the target of cutting India's oil import dependence by 10 percent by 2020.
Traders may take note of report that NITI Aayog Vice-Chairman Rajiv Kumar
called for a review of regulations under the Essential Commodities Act to
protect the interests of farmers and boost agriculture exports. Though, some
cautiousness may come with weakness in global markets. Meanwhile, the
International Monetary Fund said that the government needs to become more transparent
on the fiscal numbers as it is a laggard among the G20 peers on this front. It
added that the government has been missing its budgeted fiscal targets for the
past few years and there is a need for a credible fiscal consolidation which is
more ambitious as well. There will be some buzz in the infrastructure stocks
with Crisil's report that road developers are looking at a massive plunge in
their revenue growth to the tune of 50 percent during the current and next
fiscals mainly due to the delays in awarding new projects. Metal stocks will be
in focus with Union Minister Dharmendra Pradhan's statement that steel
consumption in India is set for a quantum jump and investors should come
forward and become a partner in the country's growth story.
Support and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,966.05
|
11,876.57
|
12,029.22
|
BSE Sensex
|
40,469.78
|
40,135.90
|
40,705.28
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
2,260.83
|
68.70
|
67.12
|
70.72
|
SBI
|
321.57
|
317.55
|
314.72
|
319.67
|
Tata Motors
|
289.24
|
174.50
|
171.22
|
177.07
|
ZEEL
|
284.83
|
285.80
|
277.73
|
298.88
|
ICICI Bank
|
249.23
|
480.70
|
469.00
|
488.15
|
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