Equity benchmarks bounced back on
Thursday, with Sensex and Nifty reclaiming their crucial psychological levels
of 37,300 and 11,250, respectively. After a cautious start, key indices
remained choppy for the most part of the day, as India's merchandise exports
fell to a four-month low of 0.64% in April, 2019 as compared to same period of
last year, as shipments of engineering goods, gems and jewellery, leather and
other products declined, widening the trade deficit to a five-month high. The
trade deficit, a gap between exports and imports, expanded to $15.33 billion in
April 2019 as compared to $13.72 billion in April 2018. Adding some anxiety
among traders, NSE imposed fines on 250 companies and the penalty was in the
range of Rs 1,000 to Rs 4.5 lakh for non-compliance with various listing
regulations for the quarter ended March 31, 2019. However, last leg buying
helped the markets to settle the session near day's high points. Market
participants got comfort, as the Reserve Bank of India released a vision document
for ensuring a safe, secure, convenient, quick and affordable e-payment system
as it expects the number of digital transactions to increase more than four
times to 8,707 crore in December 2021. Investors were seen taking a note of the
PHD Chamber of Commerce and Industry's (PHDCCI) statement that a decisive
government at the Centre would be crucial to push India's growth trajectory to
the next level and further improve the ease of doing business scenario. Some
support also came with reports that trade body Confederation of Indian Industry
(CII) would focus on enhancing industry's competency and employment generation
under its seven point charter for the southern region this year. Finally, the
BSE Sensex gained 278.60 points or 0.75% to 37,393.48, while the CNX Nifty was
up by 100.10 points or 0.90% to 11,257.10.
The US markets settled higher on
Thursday amid investors weighed the latest developments on the trade front
after President Donald Trump appeared to target Chinese telecommunications
group Huawei Technologies Company with an emergency declaration against threats
to US technology. Further, the strength on markets also reflected a positive
reaction to earnings reports from Walmart (WMT), with the retail giant climbing
by 1.4%. The advance by Walmart comes after the company reported fiscal first quarter
earnings that exceeded street estimates on better than expected comparable
store sales growth. Besides, the markets also benefited from the release of a
batch of upbeat economic data, including report from the Labor Department
showing initial jobless claims dropped more than expected in the week ended May
11. The report said initial jobless claims slid to 212,000, a decrease of
16,000 from the previous week's unrevised level of 228,000. Street had expected
jobless claims to dip to 220,000. A separate report from the Commerce
Department showed a substantial increase in new residential construction in the
month of April. The Commerce Department said housing starts surged up by 5.7%
to an annual rate of 1.235 million in April after climbing by 1.7% to a revised
rate of 1.168 million in March. Meanwhile, the Philadelphia Federal Reserve
also released a report a significant acceleration in the pace of growth in
regional manufacturing activity in May. The Philly Fed said its diffusion index
for current general activity surged up to 16.6 in May after falling to 8.5 in
April, with a positive reading indicating growth in regional manufacturing
activity. Dow Jones Industrial Average surged 214.66 points or 0.84 percent to
25862.68, Nasdaq rose 75.90 points or 0.97 percent to 7898.05 and S&P 500
was up by 25.36 points or 0.89 percent to 2876.32.
Magnifying their previous
session's gains, crude oil futures ended higher on Thursday as investors
focused on still percolating Middle East tensions. The Saudi-led coalition in
Yemen said it launched a series of airstrikes on Iran-backed Houthi rebels. The
move was in retaliation for the Houthi attacks earlier this week on the Saudi's
oil infrastructure. Besides, the Energy Information Administration (EIA) said
domestic supplies of natural gas rose by 106 billion cubic feet for the week
ended May 10. A survey of analysts by S&P Global Platts had shown
expectations for an increase of 101 billion cubic feet, while the five-year
average stands at a climb of 88 billion. Benchmark crude oil futures for June
surged 85 cents or 1.4 percent to settle at $62.87 a barrel on the New York
Mercantile Exchange. July Brent crude gained 85 cents or 1.2 percent to settle
at $72.62 a barrel on London's Intercontinental Exchange.
Rising for the third straight day, Indian rupee ended
considerably stronger against dollar on Thursday, amid fresh selling of the
American currency by exporters and banks. Sentiments remained up-beat with a
report that the India's services exports rose by 6.6 per cent to $17.94 billion
in March. Services imports in March too grew by 10.55 per cent to $11.37
billion. The trade balance in services for the month under review is estimated
at $6.58 billion. A spectacular relief rally in local equities also supported
the forex sentiment. Traders overlooked report that monsoon rains are expected
to hit Kerala on June 6, five days after its normal onset date. The India
Meteorological Department (IMD) also said the southwest monsoon arrival over
the State is likely to be slightly delayed. On the global front, euro edged
higher against the dollar and sterling on Thursday as the threat of U.S. tariffs
on autos was pushed back, though the rise was capped by unease about this
weekend's European parliamentary elections. Finally, the rupee ended at 70.03,
30 paise stronger from its previous close of 70.34 on Wednesday.
The FIIs as per Thursday's data
were net sellers in equity segment, while they were net buyers in debt segment.
In equity segment, the gross buying was of Rs 4208.89 crore against gross
selling of Rs 5256.49 crore, while in the debt segment, the gross purchase was
of Rs 3897.41 crore with gross sales of Rs 1339.33 crore. Besides, in the
hybrid segment, the gross buying was of Rs 92.69 crore against gross selling of
Rs 22.15 crore.
The US markets ended higher for
third straight session on Thursday following solid economic data and good
earnings from Dow members Cisco and Walmart. Asian markets are trading mixed on
Friday as upbeat US economic data and solid corporate results aided sentiments,
though, US-China trade tensions kept the markets in check. Indian markets ended
Thursday's choppy trading session higher with gains of over 0.70 per cent each,
mainly due to late hour buying by investors. Today, the start of last trading
day of week is likely to be cautious tracking mixed cues from Asian peers and
ahead of key exit poll for the current Lok Sabha elections due on May 19
evening after the last phase of voting. Investors may also remain on the
sidelines ahead of outcome of 17th Lok Sabha election on May 23. However, some
support may come later in the day with a report that the ongoing trade war
between the US and China will help India tap export opportunities in both the countries
in areas such as garments, agriculture, automobile and machinery. Traders may
take note of report that Finance Commission held discussions with the finance
ministry on fiscal and economic management as well as rationalisation of
expenditure related to centrally sponsored schemes. The 15th Finance Commission
observed that the GDP numbers suggest continued high growth over the medium
term even though there have been fluctuations within the overall global trend.
Meanwhile, the Reserve Bank of India (RBI) made it mandatory for NBFCs with
assets size of more than Rs 50 billion to appoint a chief risk officer (CRO) to
ensure highest standards of risk management. The RBI said that the CRO shall be
a senior official in the hierarchy of an NBFC and shall possess adequate
professional qualification or experience in the area of risk management. The
CRO should be appointed for a fixed tenure with the board's approval. There
will be some reaction in banking sector stocks with a private report that
public sector banks are demanding a capital infusion of Rs 50,000 crore in the
ongoing financial year 2019-20. The Finance Ministry had infused Rs 1.06 lakh
crore as bank recap during the previous financial year as against the budgeted
target of Rs 65,000 crore. There will be some buzz in the auto sector stocks
with Additional Chief Secretary and Commissioner of Commercial Taxes, Dr. T.V.
Somanathan's statement that the improvement in economic efficiency from the
introduction of Goods and Services Tax (GST) is one of the reasons for slowdown
in commercial vehicle sales. There will be lots of earnings reaction to keep
the markets buzzing.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
11,257.10
|
11,173.12
|
11,311.32
|
BSE Sensex
|
37,393.48
|
37,124.21
|
37,590.85
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
827.31
|
137.75
|
132.97
|
144.22
|
Tata Motors
|
303.08
|
175.40
|
172.95
|
177.70
|
Sun Pharma
|
251.56
|
412.40
|
387.77
|
428.32
|
ZEEL
|
213.27
|
345.70
|
325.30
|
358.90
|
SBI
|
181.48
|
315.75
|
311.17
|
318.72
|
Bajaj Finance has allotted 750 Secured redeemable NCDs of face value of Rs 10 lakh each aggregating to Rs 75 crore.
Tata Steel is going to continue exploring various business options including merger in Europe, with an aim to make European business stronger.
HDFC has entered into a partnership with India Mortgage Guarantee Corporation for a mortgage guarantee-backed home loan.
Tata Motors has launched its official app Tata Motors Service Connect for the customers of passenger vehicles business which allows them to connect with company for his/her after market needs.