Indian equity bourses maintained
their gains on Wednesday to end the session on higher note. Key indices made a positive start of the day,
aided with Finance Minister Nirmala Sitharaman's statement that the up and down
in Gross Domestic Product (GDP) are part of the growth process and the
government is responding to the current economic challenges to revive demand
and consumption in the country. Adding some optimism, the Export-Import Bank of
India (Exim Bank) forecasted India's merchandise exports to increase from $81.4
billion to $82 billion, with an expected growth rate of 0.6% from a year ago
during the second quarter of 2019-20 (July-September). Firm trade persisted
throughout the trading day, on the back of positive cues from the global
markets. Investors were seen taking note
of a private report stating that India's high-tech sectors have the potential
to attract a whopping $21 billion in investment and create millions of jobs
over the next five years. However, gains remained capped, as credit rating
agency, Fitch Ratings in its Asia-Pacific Sovereign Credit Overview has
forecasted India's economic growth at 6.6% during the current year 2019-20
(FY20), down from 6.8% in the previous year. The agency also added that the
government has only limited room to ease fiscal policy because of high debt.
Finally, the BSE Sensex gained 125.37 points or 0.34% to 37,270.82, while the
CNX Nifty was up by 32.65 points or 0.30% to 11,035.70.
The US markets ended higher on
Wednesday following reports that China is granting tariff exemptions for 16
types of American-made products as a sign of goodwill ahead of the next round
of trade talks. The list included varieties of animal feed such as alfalfa and
fish meal, cancer drugs gefitinib and capecitabine, base oil for lubricants and
lubricating grease, and some farm chemicals. The Chinese Customs Tariff
Commission said the tariff suspension would take effect next Tuesday and remain
in place for a year. The strength on markets also came in on optimism about new
global stimulus ahead of the European Central Bank's monetary policy decision
on Thursday as well as next week's Federal Reserve meeting. President Donald
Trump urged the Fed to lowest interest rates to zero or less, allowing the US
to refinance its debt. On the economic data front, a report released by the
Labor Department showed a modest uptick in US producer prices in the month of
August. The Labor Department said its producer price index for final demand
inched up by 0.1 percent in August after rising by 0.2 percent in July. Street
had expected prices to come in unchanged. The slight increase in producer
prices came even though energy prices tumbled by 2.5 percent in August after
surging up by 2.3 percent in the previous month. Gasoline prices plummeted by
6.6 percent. Food prices also showed a notable pullback during the month,
slumping by 0.6 percent in August after rising by 0.2 percent in July. Besides,
wholesale inventories in the US showed a modest rebound in the month of July,
according to a report released by the Commerce Department. The report said
wholesale inventories rose by 0.2 percent in July after edging down by a
revised 0.1 percent in June. The uptick in inventories matched Street
estimates. Dow Jones Industrial Average surged 227.61 points or 0.85 percent to
27137.04 Nasdaq gained 85.52 points or 1.06 percent to 8169.68 and S&P 500
was up by 21.54 points or 0.72 percent to 3000.93.
Crude oil futures ended lower
with cut of over two and half percent on Wednesday on speculation that
President Donald Trump is considering easing sanctions on Iran raised the
possibility of the return of the country's crude to the world market. Oil
prices also dropped on report that the Organization of the Petroleum Exporting
Countries lowered its forecast for global oil-demand growth in 2019 and 2020,
citing weaker-than-expected data in the first half of this year from various
global demand centers and slower economic growth projections. However, the
Energy Information Administration (EIA) reported that US crude supplies fell by
6.9 million barrels for the week ended September 6. Benchmark crude oil futures
for October dropped $1.65 or 2.9 percent to settle at $55.75 a barrel on the
New York Mercantile Exchange. November Brent declined $1.57 or 2.5 percent to
settle at $60.81 a barrel on London's Intercontinental Exchange.
Indian
rupee ended marginally higher against dollar on Wednesday, as bankers and
exporters took to selling of American currency. Sentiments were positive with
Finance Minister Nirmala Sitharaman's statement that the government is not
underestimating the slow Gross Domestic Product (GDP) growth and has full focus
on how it can rise in the next quarter. She also added that the government is
trying to revive demand and consumption in the country. Besides, positive trend
in equity market supported the rupee. However, further gains were restricted as
some concern came with report that Fitch Ratings forecasted India's economic
growth at 6.6% during the current year, down from 6.8% in the previous year,
and said the government has only limited room to ease fiscal policy because of
high debt. On the global front, Japanese yen fell on Wednesday as the rush into
safe-haven assets during the summer continued to unwind on the back of rising
risk appetite, while the euro paused before Thursday's European Central Bank
meeting. Finally, the rupee ended at 71.66, 5 paise stronger from its previous
close of 71.71 on Monday.
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 3610.23 crore against gross
selling of Rs 3312.43 crore, while in the debt segment, the gross purchase was
of Rs 2234.94 crore with gross sales of Rs 1963.06 crore. Besides, in the
hybrid segment, the gross buying was of Rs 12.86 crore against gross selling of
Rs 8.35 crore.
The US markets ended higher on
Wednesday amid reports that China is granting tariff exemptions for 16 types of
American-made products as a sign of goodwill ahead of the next round of trade
talks. Asian markets are trading mostly in green on Thursday on hopes for a
thaw in US-China trade frictions and expectations that the European Central
Bank will kick off another wave of monetary easing by global central banks.
Indian markets ended higher with modest gains on Wednesday led by gains in
banking and auto stocks amid firm cues from other Asian markets. Today, the
start of session is likely to be in green tracking firm global cues coupled
with steep fall in oil prices. Investors will be eyeing the data on factory
output (IIP) for July and retail inflation (CPI inflation) for August set to be
release later in the day. Traders will be taking support with finance minister
Nirmala Sitharaman's statement that the government will frontload
infrastructure spending in a bid to give the economy a boost and announce one
or two more sets of stimulus measures aimed at reviving growth in the coming
quarters. Though, there may be some cautiousness with global rating agency
Moody's statement that Indian non-banking financial companies (NBFCs) and
housing finance companies (HFCs) are pulling back on loan against property
(LAP) lending to micro, small and medium sized enterprises (MSMEs) because of
the funding squeeze caused by the liquidity crisis in the country's financial
sector. It added that this situation is a credit negative for the asset- backed
securities. Meanwhile, oil producers cartel the Organization of the Petroleum
Exporting Countries (OPEC) said that India's oil demand will rise by the
fastest pace globally this year and the next even as its economic expansion has
slowed down. Auto stocks will be in focus with Union minister Nitin Gadkari's
statement that it is up to the finance ministry along with state governments
and GST Council to decide on reduction in GST rate for automobiles and that he
has already spoken to the finance minister in this regard. There will be some
buzz in the banking stocks with report that the government has decided to
infuse Rs 55,000 capital in Public Sector Banks (PSBs) under consolidation
process in a week's time. There will be some reaction in aviation stocks with
Crisil's report that low-cost airlines like SpiceJet, IndiGo and Air Asia
(India) are set to see their earnings before interest, tax, depreciation,
amortisation and lease rentals (EBITAR) to grow to 24-25% this fiscal compared
to 15-16% in the last fiscal on the back of firmer fares and strong passengers
loads.
Support and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,035.70
|
11,013.30
|
11,056.45
|
BSE Sensex
|
37,270.82
|
37,195.11
|
37,345.00
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in
Lacs)
|
Yes Bank
|
3,329.39
|
71.60
|
65.92
|
76.37
|
Tata Motors
|
965.68
|
134.35
|
128.10
|
137.80
|
SBI
|
210.00
|
285.25
|
280.55
|
287.90
|
ICICI Bank
|
174.64
|
394.60
|
392.30
|
397.95
|
Indiabulls Housing Finance
|
162.13
|
431.45
|
423.17
|
438.72
|
L&T's overseas subsidiary -- L&T Oman LLC has been awarded the main works contract of The Mandarin Oriental, Muscat by Eagle Hills, Muscat.
Tata Motors' wholly owned subsidiary -- JLR has reported 6.7% fall in total sales at 34,176 units in August as compared with year-ago period.
ONGC is planning to invest more than Rs 13,000 crore in exploring oil and gas by drilling over 220 wells across Assam in the next five years.
Dr. Reddy's Laboratories has launched Fosaprepitant Injection in the US Market.