Bears continued to rule the roost
at Dalal Street for third straight session, with frontline gauges breaching
their crucial 31,800 (Sensex) and 9,950 (Nifty) levels, as geopolitical worries
mainly weighed on the sentiments with remarks by President Donald Trump adding
to concerns about rising tensions between the US and North Korea. Indian
markets started on pessimistic note and traded under pressure, as investors
continued to remain concerned after capital market regulator SEBI directed
exchanges to initiate action against 331 suspected shell companies. SEBI's
restrictions on trading in 331 stocks have impacted about 36 lakh investors.
These include some big names, such as Rakesh Jhunjhunwala, DSP Blackrock, HDFC
Mutual, Reliance Mutual and UTI among domestic investors. Foreign institutions
like Goldman Sachs, Fidelity, Blackrock and Smallcap World too are holders of
some of these stocks. In last leg of
trade, markets tried to pare their losses, but immense selling in dying hour of
trade shattered all their hopes of getting a positive close. Investors failed
to get any support with the government's statement that job loss through
automation in India should not be a matter of concern as the ‘growth momentum' of
the economy will result in new job opportunities. Investors paid no heed
towards Niti Aayog Vice-Chairman Rajiv Kumar's statement that the
implementation of Goods and Services Tax (GST) has brought down overall tax
burden on the economy. Union Power Minister Piyush Goyal's statement that the
newly-introduced GST is crucial for promoting transparency and a
corruption-free business environment in the country, too failed to provide
markets any strength. Finally, the BSE Sensex declined 216.35 points or 0.68%
to 31,797.84, while the CNX Nifty was down by 70.50 points or 0.71% to
9,908.05.
The US markets closed lower on
Wednesday, but off session lows as tensions between North Korea and the US
added a dollop of geopolitical uncertainty to markets, and as high-profile
companies disappointed with their quarterly results. In the latest escalation
of tensions between Washington and Pyongyang, the isolated Asian country
threatened a missile strike at US territory Guam. That saber-rattling came a
day after US President Donald Trump said he would respond with fire and fury
like the world has never seen if the country doesn't halt its threats. On the
economy front, the productivity of US workers accelerated a bit in the second
quarter as economic growth accelerated, though it remains well below historical
average. Productivity - or how many goods and services US workers produce per
hour - rose at an annual rate of 0.9% in the second quarter from the prior
three months. This is up from a 0.1% rate in the first quarter. Unit labor
costs, a measure of wages and benefits for US workers, grew at a 0.6% rate in
the second quarter compared with the prior three months. This is down from a
5.4% rate in the first quarter. This closely-followed measure reflects how much
it costs a business to produce one unit of output, such as a ton of coal, a
ream of paper or a bushel of wheat. Faster output growth drove the strength in
productivity. Output rose at a 3.4% rate in the second quarter compared with a
1.8% gain in the first quarter. The Dow Jones Industrial Average lost 36.64
points or 0.17 percent to 22,048.70, the Nasdaq dropped 18.13 points or 0.28
percent to 6,352.33, while the S&P 500 edged lower by 0.9 points or 0.04
percent to 2,474.02.
Crude oil futures bounced back on
Wednesday, on data showing a sharp decline in supplies of U.S. crude but gains
were capped by a surprise uptick in gasoline stockpiles. The report from the
Energy Information Administration (EIA) showed crude stockpiles fell by more
than expected last week, pointing to an uptick in refinery activity. EIA
reported that US crude oil inventories fell by 6.5 million barrels to 1.15
billion barrels while gasoline inventories rose 3.4 million barrels to 231.1
million barrels in the week ended Aug. 4. It was sixth-straight week of falling
crude inventories. Benchmark crude oil futures for September delivery gained $0.23
or 0.5 percent to $49.41 on the New York Mercantile Exchange. In London, Brent
crude for September delivery ended higher by $0.53 at $52.67 a barrel on the
ICE.
In line
with equity market, the Indian rupee ended lower against US dollar on
Wednesday, on account of sustained demand for dollar from banks and importers
despite weakness in American currency overseas. Geopolitical worries mainly
weighed on the sentiments with remarks by President Donald Trump adding to
concerns about rising tensions between the US and North Korea. Investors paid
no heed towards Niti Aayog Vice-Chairman Rajiv Kumar's statement that the
implementation of GST has brought down overall tax burden on the economy.
Finally, the rupee ended at 63.83, 20 paise weaker from its previous close of
63.63 on Tuesday.
The
FIIs as per Wednesday's data were net buyers in equity and debt segments both. In
equity segment, the gross buying was of Rs 6587.22 crore against gross selling
of Rs 4689.20 crore, while in the debt segment, the gross purchase was of Rs
1906.64 crore with gross sales of Rs 975.73 crore.
The US markets extended their
weakness and ended mildly lower once again in the last session on geopolitical
concerns amid a continued increase in tensions between the U.S. and North
Korea. The Asian markets have made mostly a soft start triggered by an
escalation in tensions between the U.S. and North Korea, though many of the
indices have halted the slide and some are making attempt to enter the green. The
Indian markets once again lost the momentum completely in the final hours and
lost over half a percent in the last
trade. Today, the start is likely to be cautious, on muted global cues,
though some recovery can be expected in the latter part of the trade. Traders
will be getting some support with report that a contraction in refund outgo,
rich dividends from ‘Operation Clean Money' and more assessees coming under the
income tax net post demonetisation, net direct tax collections surged 19.1 per
cent to Rs1.90 lakh crore during April-July. Markets will also be getting some
support with industrialist Adi Godrej's statement that despite certain teething
problems under the new tax regime, the Goods and Services Tax (GST) will lead
to considerable increase in the GDP in the next six months. Meanwhile, the
government has notified the timeline for furnishing final tax returns for July
and August under the GST regime. As per the notification, outward supplies in
Form GSTR-1 for the month of July will have to be filed between September 1-5.
For August, it is to be filed between September 16-20. The original date for
filing GSTR-1 was 10th of the next month. There will be lots of important
earnings too, to keep the markets in action. There will be some buzz from the
primary market too, as the shares of Security and Intelligence Services (SIS)
will make its stock market debut today, the issue was subscribed 7 times.
Support and Resistance: NSE
(Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
9908.05
|
9877.47
|
9954.22
|
BSE Sensex
|
31797.84
|
31697.41
|
31932.78
|
Nifty Top volumes
Stock
|
Volume
(in Lacs)
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
SBI
|
158.53
|
302.30
|
299.12
|
306.47
|
ICICI Bank
|
129.59
|
290.60
|
288.83
|
293.38
|
Hindalco
|
128.45
|
239.45
|
236.83
|
242.63
|
Vedanta
|
123.67
|
300.20
|
296.37
|
305.37
|
Sun Pharma
|
110.26
|
474.35
|
465.97
|
488.12
|
Kotak Mahindra Bank will offer debit cards at a special price of Rs 99 for the first year for customers who will open account under its zero balance account scheme.
Lupin has received a 505 (b) (2) NDA approval for its Nikita (Pitavastatin) Tablets 1 mg, 2 mg and 4 mg from the USFDA.
ICICI Bank has launched instant credit cards to facilitate its savings account customers to get a credit card instantly, in a completely digital and paperless manner.
HDFC Bank is increasing its term financing exposure gradually on the back of rising demand for financing from the road and power transmission sector as it seeks to diversify its balance sheet.