Indian equity benchmarks closed
the last trading day of the week near their intraday low points, with Sensex
and Nifty losing almost 300 and 100 points, respectively, on the back of heavy
losses in Realty, Telecom and Banking stocks. The start of the day was weak,
amid credit rating agency, ICRA's latest research report stating that the
earnings released by 642 companies in the Indian corporate sector revealed that
the revenue growth in the fourth quarter (January-March) of FY18-19 hit a
six-quarter low at 10 percent. It added that weak consumer sentiments and
softening of commodity prices led to a fall in the revenue growth in the last
quarter of FY19. In the last leg of the trade, key indices extended theirs
losses, tracking weak global markets. Market participants paid no heed towards
a report that India's Wholesale price index (WPI) inflation continued its
easing trend for second straight month and hit 22-month low of 2.45% in the month
of May 2019, the lowest level since July 2017, as prices of food articles
cooled down. As per the data of Ministry of Commerce & Industry, WPI for
All Commodities (Base: 2011-12=100) for the month of May, 2019 stood at 2.45%
(provisional) as compared to 3.07% (provisional) for the previous month and
4.78% during the corresponding month of the previous year. Finally, the BSE
Sensex declined 289.29 points or 0.73% to 39,452.07, while the CNX Nifty was
down by 90.75 points or 0.76% to 11,823.30.
The US markets ended slightly
lower on Friday as traders weighed rising tensions with Iran and the ongoing
trade battle with China. Markets staged a late-day recovery attempt, but failed
to settle in green terrain. Tech stocks came under pressure after Broadcom
(AVGO) reported better than expected fiscal second quarter earnings but lowered
its full-year revenue guidance. Broadcom President and CEO Hock Tan said the
chip maker sees a broad-based slowdown in the demand environment due to
continued geopolitical uncertainties and the effects of export restrictions on
Chinese tech giant Huawei. The comments from Tan led to renewed concerns about
the impact of the US-China trade dispute on the broader tech sector. Investors
continued to watch developments in the Middle East after a pair of oil tankers
were attacked near the Strait of Hormuz on June 13. The incident escalates
tensions in the region, heightening fears of a potential US-Iran military
confrontation and disruption to oil supplies. On the economic front, the
Commerce Department report showed a substantial upward revision to retail sales
data for April. The Commerce Department said retail sales climbed by 0.5
percent in May after rising by an upwardly revised 0.3 percent in April.
Closely watched core retail sales, which exclude autos, gasoline, building
materials and food services, climbed by 0.5 percent in May. The April reading
was upwardly revised from no change to a 0.4 percent gain. Besides, the Federal
Reserve also released a report showing a bigger than expected increase in
industrial production in May, although the University of Michigan said its
reading on consumer sentiment dropped in June amid concerns about higher
tariffs. Dow Jones Industrial Average declined 17.16 points or 0.07 percent to
26089.61, Nasdaq slipped 40.47 points or 0.52 percent to 7796.66 and S&P
500 was down by 4.66 points or 0.16 percent to 2886.98.
Crude oil futures extended their
gains for second straight session on Friday amid concerns about disruptions to
the global flow of oil following the recent attacks on two oil tankers in the
Gulf of Oman. However, prices came off higher levels as the session progressed
with traders reacting to the latest reports from the International Energy
Agency (IEA) and the Organization of the Petroleum Exporting Countries (OPEC)
on energy demand outlook. The IEA has cut its outlook for oil demand growth in
2019, saying economic sentiment is weakening and the consequences for oil
demand are becoming apparent. The IEA revised down its 2019 demand growth
estimate by 100,000 barrels to 1.2 million barrels per day (bpd), but said it
would climb to 1.4 million bpd for 2020. Benchmark crude oil futures for July
gained 23 cents or 0.4 percent to settle at $52.51 a barrel on the New York
Mercantile Exchange. August Brent rose 70 cents or 1.1 percent to settle at
$62.01 a barrel on London's Intercontinental Exchange.
Extending weakness for the second day, Indian rupee ended
significantly weaker against dollar on Friday, as good demand for the greenback
from importers and weakness in domestic shares. Market participants paid no
heed towards a report that India's Wholesale price index (WPI) inflation
continued its easing trend for second straight month and hit 22-month low of
2.45% in the month of May 2019, the lowest level since July 2017, as prices of
food articles cooled down. On the global front, British pound fell again on
Friday as investors trimmed their positions after Brexiteer Boris Johnson moved
closer to becoming the next prime minister, putting sterling on course for a
six-week losing streak versus the euro. Finally, the rupee ended at 69.80, 30
paise weaker from its previous close of 69.50 on Thursday.
The FIIs as per Friday's data
were net buyers in equity and debt segments both. In equity segment, the gross
buying was of Rs 5191.85 crore against gross selling of Rs 5183.44 crore,
while, in the debt segment, the gross purchase was of Rs 1158.09 crore with
gross sales of Rs 1121.74 crore. Besides, in the hybrid segment, the gross
buying was of Rs 0.96 crore against gross selling of Rs 2.31 crore.
The US markets ended marginally
in red on Friday as tepid economic data and rising tensions in the Middle East
added to concerns over growth and trade. Asian markets are trading mixed on
Monday ahead of the monetary policy decision of the US Federal Reserve on June
19. Indian markets ended lower on Friday with losses of around 0.75% each,
mainly on the back of later hour sell-off led by decline in private sector
lenders like IndusInd Bank, Axis Bank and Kotak Mahindra Bank. Today, the start
of new week is likely to be cautious amid concerns over rising oil prices and
delayed monsoon. India Meteorological Department stated that the overall
monsoon deficiency in the country has reached 43 per cent due to its sluggish
pace. It said the progress of monsoon was halted due to Cyclone Vayu. As its
intensity decreases, they expect monsoon to progress in the next 2-3 days. Some
cautiousness will come with report that the continuing of high crude and gold
imports pushed India's trade deficit to a six-month high of $15.36 billion in
May. Besides, India's exports grew by 3.93 per cent to $30 billion in May on
account of healthy growth in sectors such as chemicals, pharmaceuticals and
engineering, while imports too rose by 4.31 per cent to $45.35 billion in May.
Traders will also be reacting to report that India announced a hike in customs
duties on as many as 28 US products, including almond, pulses and walnut, in
response to higher tariffs imposed by Washington on Indian products like steel
and aluminium. The move will hurt American exporters of these 28 items as they
will have to pay higher duties, making those items costlier in the Indian
market. Traders will also be concerned with ICRA's report that housing finance
growth is set to slow down to 13-15 percent this fiscal, lower than the average
of the past three years, due to the lingering liquidity issues faced by
non-banking lenders. It added that there can also be an adverse impact on the
outstanding housing credit, which stood at Rs 19.1 lakh crore as of March 2019.
There will be some buzz in the banking sector stocks with report that the
Finance Ministry is evaluating capital needs of state-owned banks, and likely
to provide about Rs 30,000 crore in the upcoming Budget to help them meet
minimum regulatory capital requirement in the current fiscal.
Support and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous
close
|
Support
|
Resistance
|
NSE
Nifty
|
11,823.30
|
11,776.72
|
11,890.87
|
BSE
Sensex
|
39,452.07
|
39,277.05
|
39,713.50
|
Nifty Top volumes
Stock
|
Volume
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
1,551.70
|
115.05
|
111.60
|
119.75
|
Indiabulls Housing
Finance
|
299.69
|
672.25
|
653.37
|
699.92
|
Power Grid
|
196.76
|
194.60
|
192.98
|
196.58
|
Zee Entertainment
|
159.17
|
336.50
|
324.02
|
351.22
|
Tata Motors
|
109.21
|
164.20
|
162.63
|
166.63
|
Wipro will be opening a new center of excellence for clients in the Minneapolis-St. Paul region in USA.
Maruti Suzuki India has launched WagonR (1.2 Ltr) with BS-VI compliant.
Mahindra Partners, the $1 billion Private Equity division of the Mahindra Group, has launched TEQO.
Bajaj Finance has collaborated with MobiKwik to take the Bajaj Finserv Wallet to over 2 million online and offline MobiKwik merchant network stores.