Key Indian equity benchmarks
geared up on Wednesday to end the trading session with plenty of gains i.e.
1.79%, ahead of macro-economic data of industrial production and consumer price
inflation to be released after the market hours. The start of day was cheerful,
aided by reports that the Reserve Bank will infuse Rs 10,000 crore into the
market through open market operations (OMOs) on December 13. Adding some
enthusiasm on the street, Industry body CII said that the appointment of former
bureaucrat Shaktikanta Das as the new Reserve Bank of India (RBI) Governor
comes as a huge sentiment booster to the industry and expressed confidence that
he will take urgent steps to address the liquidity squeeze in economy. Das was
appointed as the new governor of the RBI, a day after his predecessor Urjit
Patel's resignation. Domestic sentiments also got boost, with another report
stating that markets regulator SEBI will discuss a slew of measures at its
board meeting on December 12 for expanding its offer for sale framework to more
companies, relax its norms for clubbing of investment limits by established
foreign investors and tighten insider trading rules. In the second half of the
session, the markets gained traction to reach their intraday high points,
tracking really in global markets. The markets participants remained
encouraged, as Asian Development Bank (ADB) retained Indian growth forecast at
7.3 percent for the current fiscal and 7.6 percent for the next financial year
2019-20, amid rebounding exports and higher industrial & agricultural
output. Separately, CII said that the government should consider permitting
100% foreign direct investment. Further, the street were seen taking note of
Fitch Ratings' statement that the resignation of Urjit Patel as Reserve Bank
Governor highlights the risks to RBI's policy priorities and increased
government influence on the central bank could undermine the efforts to address
bad loan problems. The markets overlooked report that the government has
detected GST evasion worth Rs 12,000 crore in 8 months till November. Finally,
the BSE Sensex surged 629.06 points or 1.79% to 35,779.07, while the CNX Nifty
was up by 188.45 points or 1.79% to 10,737.60.
The US markets ended higher on
Wednesday as traders keep up hope that the US and China will make progress on resolving
their trade dispute. The strength on markets came in after President Donald
Trump expressed optimism about striking a trade deal with Chinese President Xi
Jinping. Trump noted that trade talks between US and Chinese officials were
underway by telephone and suggested more meetings are likely. Moreover, he said If it is necessary, I will have another meeting with President Xi, who I like
a lot and get along with very well. Further, Trump said he could potentially
intervene in the arrest of Huawei Technologies Company's chief financial
officer Meng Wanzhou, offsetting concerns her detention could hurt trade
negotiations. Meng was arrested in Canada, where she faces possible
extradition, at the behest of the US over allegations she had lied to banks about
Huawei's connections with another firm that did business with Iran. On the
economic front, with a sharp pullback in gasoline prices offsetting increases
in other prices, the Labor Department released a report showing consumer prices
came in flat in the month of November. The report said the Labor Department's
consumer price index was unchanged in November after rising by 0.3 percent in
October. The unchanged reading matched street estimates. The report said energy
prices tumbled by 2.2 percent in November after jumping by 2.4 percent in
October, as gasoline prices plunged by 4.2 percent after surging up by 3.0
percent in the previous month. The Labor Department said the steep drop by the
gasoline index was offset by increases in an array of indexes, including
shelter and used cars and trucks. Dow Jones Industrial Average surged 157.03
points or 0.64 percent to 24527.27, S&P 500 gained 14.29 points or 0.54
percent to 2651.07 and Nasdaq was up by 66.48 points or 0.95 percent to
7098.31.
Crude oil futures ended
marginally lower on Wednesday after US government data showed domestic crude
supplies declined for a second week in a row, but by much less than the market
expected. The Energy Information Administration (EIA) reported that US crude
supplies fell by 1.2 million barrels for the week ended December 7. Supplies
had also declined the week before, marking the first weekly decline in 11
weeks. However, market participates, on average, expected to see a larger
decline of 2.8 million barrels in crude supplies. Benchmark crude oil futures
for January dropped 50 cents or 1percent to settle $51.15 a barrel on the New
York Mercantile Exchange. February Brent crude lost 5 cents or less than
0.1percent to settle at $60.15 a barrel on London's Intercontinental Exchange.
Indian
rupee continued its fall for the third day in a row against the US currency on
Wednesday, on increased demand for the American unit from importers. The
weakness of the rupee comes amid a strong dollar overseas and a rise in crude
oil prices on expectations that an OPEC-led output cut for 2019 would stabilise
the supply-demand balance. Market participants paid no heed towards Asian
Development Bank (ADB) retaining Indian growth forecast at 7.3 percent for the
current fiscal and 7.6 percent for the next financial year 2019-20, amid
rebounding exports and higher industrial & agricultural output. On the
global front, dollar rose for a third consecutive day on Wednesday as U.S.
Treasury yields rose before a Federal Reserve meeting where it is widely expected
to raise interest rates for the fourth time this year. Finally, the rupee ended
at 72.01, 16 paise weaker from its previous close of 71.85 on Tuesday.
The FIIs as per Wednesday's data
were net sellers in equity and debt segments both. In equity segment, the gross
buying was of Rs 3757.00 crore against gross selling of Rs 6653.66 crore, while
in the debt segment, the gross purchase was of Rs 2063.73 crore with gross
sales of Rs 2181.41 crore. Besides, in the hybrid segment, the gross buying was
of Rs 0.24 crore against gross selling of Rs 0.04 crore.
The US markets rallied on
Wednesday as signs of easing trade tensions boosted the outlook for global
economic growth. Asian markets were trading in green on Thursday as investors
breathed a sigh of relief after British Prime Minister Theresa May survived a
no-confidence vote, and as China appeared to be taking more steps to meet US
demands to open its markets. Indian markets ended higher on Wednesday, with
gains of around two percent, led by across-the-board buying and supportive
global cues. Besides, investors reacted positively to the results of assembly
elections and the appointment of a new governor for the Reserve Bank of India.
Today, the markets are likely to make optimistic start on positive
macro-economic data amid supportive global cues. The Central Statistics Office
(CSO) in its latest data showed that India's industrial output grew at an
11-month high of 8.1% in October mainly on the back of mining, power and
manufacturing sectors coupled with higher offtake of capital as well as
consumer durable goods. Industrial production measured in terms of Index of
Industrial Production (IIP) grew 1.8% in October 2017. The previous high IIP
growth rate was recorded in November last year at 8.5%. Also, India's retail
inflation eased to 2.33% in November as compared to 4.88% in November last year
and was 3.31% in October. Traders will be getting some encouragement with
S&P Global's statement that India's rapid economic growth will be enough to
offset worries about the independence of its central bank and keep its credit
rating in the coveted investment grade bracket. Traders may take note of report
that the government hiked Minimum Support Prices (MSPs) of 22 mandated
agricultural crops and Fair & Remunerative Price (FRP) for Sugarcane on the
basis of recommendations of Commission for Agricultural Costs & Prices (CACP).
Meanwhile, exporters body Federation of Indian Export Organisations (FIEO)
urged new Reserve Bank of India (RBI) Governor Shaktikanta Das to ensure smooth
flow of credit to the sector as decline in the funds will hit outbound
shipments. There will be some buzz in banking sector stocks with rating agency
Icra's report that the government is likely to keep its bank recapitalisation
target unchanged at Rs 65,000 crore for the current financial year as lenders
under RBI's prompt corrective action (PCA) framework will not maintain capital
conservation buffers. Also, there will be some reaction in sugar sector stocks
with a private report that India's sugar production could fall in 2019/20 as
farmers are struggling to plant cane because of a drought in two of the
country's top producing states. There will be some buzz coal sector stocks with
report that India's coal imports rose by 38.2% to Rs 1,38,477 crore in monetary
terms last fiscal. In quantity terms, the coal imports increased 9.1% to 208.27
MT from 190.95 MT.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,737.60
|
10,614.87
|
10,806.27
|
BSE Sensex
|
35,779.07
|
35,355.50
|
36,014.61
|
Nifty Top volumes
Stock
|
Volume
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
718.32
|
186.60
|
182.93
|
188.88
|
ICICI Bank
|
247.40
|
349.95
|
342.33
|
354.63
|
Tata Motors
|
224.61
|
164.10
|
159.03
|
168.13
|
SBI
|
217.66
|
285.25
|
283.02
|
286.67
|
IOC
|
187.09
|
136.10
|
132.87
|
138.12
|
Wipro has launched an Automotive Innovation Center in Detroit, Michigan.
Tata Motors has launched top of the line variant of its entry level model Tiago priced between Rs 5.57 to 6.38 lakh.
SBI is running pilot projects to disburse agricultural loans digitally and expects to roll out the services very soon.
Indiabulls Housing Finance has raised funds through allotment 2,500 Secured, Redeemable, NCDs of face value Rs 10 lakh each, aggregating to Rs 250 crore.