Indian equity bourses faltered
for the 2nd straight day on Friday, with Sensex & Nifty losing around 0.50%
each. The start of the day was on firm note, as rating agency Standard and
Poor's affirmed India's sovereign rating at BBB- with stable outlook, saying
the country's GDP growth is likely to gradually recover towards longer-term
trend rates over the next two to three years. But soon, indices turned weak,
with the International Monetary Fund's communications director Gerry Rice's
statement that India's economy looks weaker than the IMF projected earlier in
January and the government needs to focus on more ambitious structural and
financial sector reform measures. Volatility remained over the Dalal Street
till the end of the trading session, on the back of weak cues from the European
markets along with rising inflation in the country. India's Wholesale price
index (WPI) inflation spiked sharply to 3.1 percent in the month of January
2020 as against 2.59 percent for the previous month and 2.76 percent during the
corresponding month of the previous year. Adding more anxiety among investors,
a report by Moody's said that the Reserve Bank of India's recent asset
recognition norms that allows banks not to treat real estate loans as
restructured for one year is credit negative for Indian banks. Finally, the BSE
Sensex lost 202.05 points or 0.49% to 41,257.74, while the CNX Nifty was down
by 61.20 points or 0.50% to 12,113.45.
The US markets ended the choppy
day of trade on muted note on account of mixed batch of U.S. economic data.
While the Commerce Department released a report before the start of trading
showing U.S. retail sales rose in line with estimates in January, closely
watched core retail sales came in unchanged. The Commerce Department said
retail sales rose by 0.3 percent in January after edging up by a downwardly
revised 0.2 percent in December. Street had expected retail sales to climb by
0.3 percent, matching the increase originally reported for the previous month.
However, the report said closely watched core retail sales, which exclude
autos, gasoline, building materials and food services, were unchanged in
January after rising by a downwardly revised 0.2 percent. Core retail sales
were expected to rise by 0.3 percent compared to the 0.5 percent increase
originally reported for the previous month. Further, the Federal Reserve
released a report showing a continued decrease in U.S. industrial production in
the month of January, as unseasonably warm weather led to another steep drop in
utilities output. The Fed said industrial production fell by 0.3 percent in
January following a revised decrease of 0.4 percent in December. Street had
expected industrial production to dip by 0.2 percent. Manufacturing output
edged down by 0.1 percent in January after inching up by 0.1 percent in
December, as Boeing (BA) significantly slowed production of civilian aircraft
amid the grounding of its troubled 737 Max. Meanwhile, the University of
Michigan released a report showing an unexpected increase in U.S. consumer
sentiment in the month of February. Preliminary data showed the consumer
sentiment index rose to 100.9 percent in February from the final January
reading of 99.8. The uptick surprised the street, who had expected the index to
edge down to 99.5.
Crude oil futures ended higher
for fourth straight session on Friday with traders creating fresh long
positions amid hopes the coronavirus impact may not weigh on the global economy
for long. Hopes that the Chinese central bank will step up stimulus to boost
growth further aided sentiment and pushed up oil prices. Meanwhile, the
Organization of the Petroleum Exporting Countries (OPEC) and allied producers
are reportedly considering deepening production cuts. Russia, which seemed
reluctant to agree on deepening output cuts, is now reported to be considering
reducing output due to increasing inventory levels. According to a report
released by Baker Hughes this afternoon, U.S. energy firms added two oil rigs
this week. With this, the total rig count has risen to 678. Crude oil futures
for March gained 63 cents or 1.2 percent to settle at $52.05 a barrel on the
New York Mercantile Exchange. April Brent crude rose 98 cents or 1.7 percent to
settle at $57.32 a barrel on London's Intercontinental Exchange.
Indian
rupee slipped against the US dollar on Friday, due to increased demand of the
greenback from the importers and the banks. Traders were cautious as India's
Wholesale Price Index (WPI) inflation worsened to 3.1 percent in January from
2.59 percent in December, registering a 0.1 percent increase. This is the
highest inflation figure in last eight months. A weak trend at Dalal Street
coupled with US dollar's gain against other currencies overseas weighed on the
local unit, while easing crude oil prices gave support and restricted the fall.
Traders also found some solace as global ratings agency Standard and Poor's
affirmed India's sovereign rating at BBB- with stable outlook, saying the
country's GDP growth is likely to gradually recover towards longer-term trend
rates over the next two to three years. On the global front, euro eased to
another nearly three-year low on Friday as investors worried about slowing
growth momentum in the eurozone ahead of an estimate of how its economy
performed in the fourth quarter. The last traded price of rupee was 71.36, 10
paise weaker from its previous close of 71.26 on Thursday.
The
FIIs as per Friday's data were net buyers in both equity and debt segments. In
equity segment, the gross buying was of Rs 5427.17 crore against gross selling
of Rs 4764.27 crore, while in the debt segment, the gross purchase was of Rs
4361.50 crore with gross sales of Rs 1118.80 crore. Besides, in the hybrid
segment, the gross buying was of Rs 13.45 crore against gross selling of Rs
8.82 crore.
Asian markets are trading mostly
lower in early deals on Monday as investors weighed the near-term hit on global
growth from a fast-spreading coronavirus outbreak in China, although
expectations of further policy stimulus helped stem losses. The US markets
ended mostly higher on Friday after the Commerce Department said retail sales
rose by 0.3 percent in January after edging up by a downwardly revised 0.2
percent in December. Indian equity benchmarks ended Friday's trade on a
negative note, as India's Wholesale Price Index (WPI) inflation worsened to 3.1
percent in January from 2.59 percent in December, registering a 0.1 percent
increase. Today, the start of the session is likely to be on negative side on
sluggish regional cues. Traders will remain concern on report that India's
exports dropped 1.66 per cent to $25.97 billion in January, the sixth straight
month of contraction, on account of a significant fall in shipments of
petroleum, plastic, carpet, gems and jewellery, and leather products. Imports
also fell for the eighth consecutive months, down 0.75 per cent to $41.14
billion in January, widening the trade deficit to a seven-month high of $15.17
billion. There will be some cautiousness too with former finance secretary
Subhash Chandra Garg's statement that the Budget for 2020-21 does not
effectively address the objective of kick-starting economic growth and building
momentum. Infrastructure investments in roads, railways and metros have been
the major planks of infrastructure investment by the government. Garg said that
in the broadest sense, the expenditure proposals of Budget 2020-21 present more
of consolidation in the face of deteriorating economic and fiscal situation.
However, some respite may come later in the day on report that Finance Minister
Nirmala Sitharaman has said the 2020-21 union budget was prepared keeping the
FRBM (Fiscal Responsibility and Budget Management) in mind even as she
maintained she would be remembered for presenting the longest prepared budget
than for longest speech on it. She added so in a way all these (measures) and
more has been done that the FRBM, as an Act, we have to keep in mind and also
comply with it. So we have not really breached the FRBM. We have not gone
outlandish on it. Tea stocks will keep buzzing on report that Tea Board
chairman P K Bezbaruah said that the statutory body should disassociate itself
from the functioning of the age-old auction system and usher in a liberalised
regime where private parties can enter. There will be some buzz in the
insurance stocks as Irdai data showed India's non-life insurance companies
registered a 7.2 per cent rise in their combined new premium collection at Rs
17,225.75 crore in January this fiscal. The 35 insurers' gross premium
collection stood at Rs 16,076.28 crore in the same month a year ago. Among
these, the 25 general insurance providers had a collective premium of Rs
14,643.26 crore during the month, up 2.2 per cent from the same period of 2019.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
12,113.45
|
12054.20
|
12209.70
|
BSE Sensex
|
41,257.74
|
40540.56
|
41579.02
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
1,878.98
|
39.20
|
37.73
|
40.43
|
Tata Motors
|
566.76
|
169.65
|
166.57
|
174.47
|
SBI
|
482.06
|
319.90
|
315.00
|
328.35
|
Bharti Airtel
|
368.26
|
563.60
|
542.72
|
576.02
|
Gail
|
287.21
|
123.15
|
119.57
|
129.12
|
Bharti Airtel's Mauritius based wholly-owned subsidiary--Network i2i has raised $250 million through perpetual bonds offering a yield of 5.65 percent.
Tata Motors has bagged an order from Uttar Gujarat Vij Company for supplying the electric version of its sub-compact sedan Tigor, which will be deployed in Gandhinagar and Ahmedabad.
Maruti Suzuki India has launched the S-CNG variant of the BS6 compliant Big New WagonR.
Reliance Industries' telecom arm -- Jio has continued its lead in average 4G download speed rankings with 20.9 mbps speed in January.