Indian equity benchmarks settled
higher for third straight session on Tuesday, despite mixed cues from global
markets. The start of the day was firm, aided by Minister of State for Finance
Anurag Thakur's statement that Indian economy is structurally and fundamentally
very strong and the current slowdown, which is cyclical in nature, would not affect
it much. He also exuded confidence that India would achieve the target of
becoming $5 trillion economy by 2024-25. Market participants also took a note
of the Finance Ministry's statement that loans worth Rs 81,781 crore were
disbursed during the nine-day outreach programme or loan mela organized by
banks that began on October 1. Bourses extended their gains in the second half
of trading session, taking support with Commerce and Industry Minister Piyush
Goyal's statement that the recent economic slowdown is a cyclic structural
adjustment, and it is the right time to invest in India before growth bounces
back. The street overlooked report that the Consumer Price Index (CPI) based
inflation jumped to a 14-month high of 3.99% in September as compared to 3.28%
in August and 3.70% in the September last year, rising for the second straight
month, due to costlier vegetables and pulses. The previous high was 4.17% in
July 2018. Though, it still remained within the Reserve Bank of India's target
range of 4%, with deviation of 2% on either side. Finally, the BSE Sensex
gained 291.62 points or 0.76% to 38,506.09, while the CNX Nifty was up by 87.15
points or 0.77% to 11,428.30.
The US markets ended higher on
Tuesday as investors cheered a raft of largely upbeat corporate earnings
reports, while considering the implications of a partial US-China trade deal
announced last Friday and the possibility of a breakthrough in Brexit
negotiations. Financial giant JPMorgan Chase (JPM) helped lead the advance on
markets after reporting third quarter results that exceeded street estimates on
both the top and bottom lines. UnitedHealth (UNH) also reported better than
expected third quarter results and raised its full-year guidance. On the
economic front, the International Monetary Fund said global economy is set to
expand at the slowest pace in a decade this year amid weak manufacturing
momentum, and rising trade and geopolitical tensions. The global lender cut the
growth forecast for this year to 3 percent from 3.3 percent projected in April,
in its latest World Economic Outlook. The pace of growth this year will be the
lowest since 2008-09 global financial crisis. The Federal Reserve Bank of New
York released a report unexpectedly showing a modest acceleration in the pace
of growth in regional manufacturing activity in the month of October. The New
York Fed said its headline general business conditions index edged up to 4.0 in
October after dipping to 2.0 in September, with a positive reading indicating
an increase in regional manufacturing activity. The modest uptick came as a
surprise to participants, who had expected the general business conditions
index to slip to 0.8. The unexpected increase by the headline index partly
reflected a notable acceleration in the pace of growth in shipments, with the
shipments index jumping to 13.0 in October from 5.8 in September.
Extending previous session
losses, crude oil futures ended lower on Tuesday as a lower economic growth
forecast from the International Monetary Fund (IMF) fueled worries over energy
demand. The IMF said that the global economy is set to expand at the slowest pace
in a decade this year. The IMF said it
sees global economic growth falling to a 3% rate this year, the slowest pace
since the 2008 financial crisis. Besides, a report from the Energy Information
Administration (EIA) that said US shale output will climb notably in November
also weighed on the commodity. According to a report from EIA, crude oil
production from major US shale plays will likely climb by 58,000 barrels a day
in November to 8.971 million barrels a day. Benchmark crude oil futures for November
declined 78 cents or 1.5 percent to settle at $52.81 a barrel on the New York
Mercantile Exchange. December Brent dropped 61 cents or 1 percent to settle at
$58.74 a barrel on London's Intercontinental Exchange.
Extending
weakness for the second day, Indian rupee ended lower against dollar on
Tuesday, as good demand for the greenback from importers. Traders remain
concerned with a data released by the Central Statistics Office (CSO) showing
that India's retail inflation rate grew 3.99% in September which is very close
to the Reserve Bank of India's (RBI) target level of 4%. The retail inflation
for August was 3.21%. Cautiousness also crept in with former RBI Governor
Raghuram Rajan expressed concern over India's fiscal deficit figures, stating
that it is the likely reason behind the slowdown in Indian economy. He also
criticised the government over its populist decision-making which failed to
focus on economic growth. Dollar weakened against some currencies overseas
coupled with strong gains in the local equity market failed to cast any impact
on the rupee. On the global front, dollar slipped against its rivals on Tuesday
as optimism over trade negotiations between the world's two largest economies
and for an orderly British exit from the European Union started to fade.
Finally, the rupee ended at 71.54, 31 paise weaker from its previous close of
71.23 on Monday.
The
FIIs as per Tuesday'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
10106.27 crore against gross selling of Rs 3953.01 crore, while in the debt
segment, the gross purchase was of Rs 867.41 crore with gross sales of Rs
924.06 crore. Besides, in the hybrid segment, the gross buying was of Rs 5.31
crore against gross selling of Rs 3.11 crore.
The US markets ended higher on
Tuesday on strong US corporate results and a possible deal to avoid a
disorderly British exit from the European Union. Asian markets are trading in
green on Wednesday as Britain and the EU made headway on a Brexit deal ahead of
a leaders' summit though it remained unclear if London could avoid postponing
its scheduled departure on October 31. Indian markets extended their gains for
third consecutive session and ended in green on Tuesday led by gains in auto,
financial and FMCG stocks. Today, the markets are likely to make positive start
following firm global cues coupled with falling oil prices and hopes of more
interest rate cuts by the Reserve Bank of India (RBI). A private report stated
that the RBI will continue to be accommodative and deliver one more rate cut in
the December policy review despite the surprising spike in headline inflation
for September. However, there may be some cautiousness as the International
Monetary Fund (IMF) slashed India's GDP growth projection for the year 2019 to
6.1%, which is 1.2% down from its April projections and noted that the Indian
economy is expected to pick up the next year at 7.0 % in 2020. Traders may be
concerned with government data showing that India's exports contracted by 6.57%
to $26 billion in September mainly due to significant dip in shipments from key
sectors such as petroleum, engineering, leather, chemicals, and gems &
jewellery. Imports too declined by 13.85% to $36.89 billion, narrowing trade
deficit to $10.86 billion in September. There will be some buzz in the auto
stocks with Ind-Ra's report that the much-awaited vehicle scrappage policy,
which is under consideration of the Cabinet, is unlikely to help revive demand
for new commercial vehicles (CVs) in the short-term, though used CVs sale may
see an improvement. Aviation stocks will be in focus with Icra's report that
Indian airlines international air passenger traffic degrew 8.2% in August as
against a 3.9% growth in the domestic volume in the same month, with market
share declining to 34.2% in the month due to under-performance. There will be
some reaction in services industry stocks with the RBI's data showing that
India's services exports rose by 10.4% to $18.24 billion in August in the
current financial year. Also, there will be some buzz in the port stocks with
Union Minister Mansukh Mandaviya's statement that the government will put in
place a comprehensive Port Grid and Port Development plan in six months for 204
minor ports in the country to boost coastal shipping and inland waterways, and
bring a Bill in Parliament to provide a fillip to major ports. There will be
some result announcements to keep the markets in action.
Support and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,428.30
|
11,359.48
|
11,479.73
|
BSE Sensex
|
38,506.09
|
38,284.51
|
38,681.43
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
1,936.02
|
40.60
|
39.25
|
41.70
|
Tata Motors
|
575.49
|
126.95
|
124.13
|
129.33
|
SBI
|
234.45
|
258.45
|
255.53
|
260.63
|
Tata Steel
|
179.72
|
349.20
|
339.15
|
358.80
|
Vedanta
|
177.89
|
153.50
|
146.70
|
158.10
|
ICICI Bank has launched FD Health, a FD offering the dual-benefit of investment growth via FD and protection through a critical illness coverage.
Mahindra group's truck and bus division has rolled out a new variant of its Blazo series of trucks in the 16-wheeler category, and it is on track to make its products BSVI compliant.
Reliance Industries' telecom arm -- Jio has launched its patent-filed innovation an artificial intelligence based video call assistant.
HCL Technologies has extended its IT operations and transformation agreement with Equinor.