Snapping the record-setting
spree, Indian equity benchmarks ended the daunting day of trade with a cut of
around a percent, with frontline gauges settling below their crucial 30,500
(Sensex) and 9,450 (Nifty) levels amid selloff as political turmoil in White
House spooked investors and dragged the global markets. Major bourses traded in
red terrain throughout the session, as traders remained on sidelines eyeing
two-day Goods and Services Tax (GST) Council meet beginning in Srinagar, which
will see participation from 29 states and union territories, along with
Jaitley, and senior officials from the revenue department. In the meeting
Finance Ministry Arun Jaitley is likely to finalise the rates that various
goods and services will attract from July 1. Meanwhile, the GST Council
approved all nine rules for the rollout of the new indirect tax regime. The
nine rules finalized by the council pertain to composition, valuation,
transition, input tax credit, invoice, payment, refund, registration and
return. Market participants failed to get any sense of relief with Commerce and
Industry Minister Nirmala Sitharaman's statement that India's exports have been
increasing despite global headwinds and efforts are being made to neutralise
any impact on them due to implementation of GST. Traders also overlooked a
senior UN economic official's statement that the demonetisation policy is not
expected to have a long term impact on domestic demand in India, which is
projected to clock a 7.9 percent growth in fiscal 2018. Selling intensified in
last leg of trade with European markets making a somber start as mounting
political uncertainty in the U.S. exacerbated concerns among investors as to
whether President Donald Trump would be able to deliver on key pro-growth
policies. Asian markets too traded weak and ended mostly in red on Thursday.
Finally, the BSE Sensex lost 223.98 points or 0.73% to 30,434.79, while the CNX
Nifty was down by 96.30 points or 1.01% to 9,429.45.
The US markets closed higher on
Thursday, as investors' sentiment, battered by political uncertainty
surrounding President Donald Trump, stabilized on a positive reading on jobless
claims. The number of Americans on unemployment fell mid-May to the lowest
level since 1988, underscoring the strongest labor market in years. So-called
continuing claims, or the number of people collecting jobless benefits, fell by
22,000 to 1.9 million in early May. That's the lowest level in 29 years. The US
economy has been creating new jobs at a rapid clip for the past six years,
knocking the unemployment rate below 5% and helping millions of Americans to
recover from the worst recession in decades. Applications for unemployment
benefits have registered less than 300,000 for 115 straight weeks, the longest
run since the early 1970s. The more stable monthly average of jobless claims
fell slightly to 240,750. Separately, manufacturing in the Philadelphia region
showed unexpected strength in May, a sign that the factory sector could be on
solid ground. The Philadelphia Fed said its manufacturing index jumped to a
reading of 38.8 in May from 22 in April. The Dow Jones Industrial Average
gained 56.09 points or 0.27 percent to 20,663.02, Nasdaq added 43.89 points or
0.73 percent to 6,055.13, while S&P 500 edged higher by 8.69 points or 0.37
percent to 2,365.72.
Crude oil futures extended their
gains on Thursday as calm returned to Wall Street following yesterday's panic
over political turbulence. Also investors remained optimistic that OPEC would
reach an agreement to extend the current supply-cut deal beyond June at its
meeting next week. OPEC would seek an extension of the current deal to cut
global production offsetting concerns over the rising level of U.S. shale
production. Though, despite the high level of compliance from OPEC members with
the deal to rein in supply, global production remains above the five-year
average. Benchmark crude oil futures for June delivery ended higher by $0.28 or
0.6 percent to $49.35 on the New York Mercantile Exchange. In London, Brent crude
for July delivery ended up by $ 0.27 to $52.48 on the ICE.
Extending weakness for the third
day in a row, Indian rupee fell sharply against US dollar on Thursday as
concern over US President Donald Trump spurred a sell-off in emerging market
currencies. Investors failed to get solace with a senior UN economic official's
statement that the demonetisation policy is not expected to have a long term
impact on domestic demand in India, which is projected to clock a 7.9 percent
growth in fiscal 2018. The domestic currency started on a weak note and
increased losses to end near intraday lows.
Losses in local equity market added to the pessimistic environment of
the currency. Besides, dollar's weakness against other currency overseas too
failed to cast any impact on the rupee. Finally, the rupee ended at 64.83, 68
paise weaker from its previous close of 64.15 on Wednesday.
The FIIs as per Thursday's data
were net buyers in equity and debt segments both. In equity segment, the gross
buying was of Rs 6310.87 crore against gross selling of Rs 5147.89 crore, while
in the debt segment, the gross purchase was of Rs 2732.32 crore with gross
sales of Rs 680.47 crore.
The US markets bounced back in
last session and the major averages partly offset the steep losses posted in
the previous session. Bargain hunting mainly contributed to the strength and
also the release of some upbeat economic data, including a report from the
Labor Department showing another unexpected drop in initial jobless claims. The
Asian markets though have made a mixed start and some indices are again in red
heading for the biggest weekly drop since March. Japanese market too was
trading cautiously as the yen headed for its strongest week in a month. The
Indian markets reeling under global pressure slumped and major benchmarks
dropped close to a percent in the last session. Today, the start is likely to
be mildly in green and some recovery can be seen after the sharp fall of last
trade. Traders will be cheering the GST Council finalising tax rates of goods
and services under the four-slab structure with essential items of daily use
being kept in the lowest bracket of 5 percent. The Council fixed the rates for
over 1200 items under the Goods and Services tax, amid demand by some states to
keep essential items under the lower tax category. Lots of daily consumption
items such as milk, fruit and vegetables, jaggery or gur, foodgrain and cereals
have been exempted from tax while others such as sugar, tea, coffee, edible
oil, mithai, and newsprint have been placed in the lowest slab of 5 per
cent. Luxury cars will attract 28 per
cent GST plus a cess of 15 per cent, while small petrol cars will face 28 per
cent plus 1 per cent cess, and diesel small cars 28 per cent tax plus 3 per
cent cess. Consumer durables, which now face a total tax of about 32 per cent,
will be taxed in the 28 per cent slab. The panel will discuss tax rates for
gold and some other items today and could meet one more time if necessary to
decide rates on remaining items. There will be sector specific buzz based on
GST rates and steel stocks may see some uptrend as the GST rate on coal has
been fixed at 5 percent. The move will bring down the input cost and would lead
to stabilisation of prices. There will be some buzz in banking sector too, as
the RBI has eased the norms of setting up bank branches and said branches
manned by either bank's staff or its business correspondents where services are
provided for a minimum of four hours per day for at least five days a week will
be called a banking outlet.
Support and Resistance: NSE (Nifty) and BSE
(Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
9429.45
|
9402.00
|
9473.00
|
BSE Sensex
|
30434.79
|
30360.40
|
30542.51
|
Nifty Top volumes
Stock
|
Volume
(in Lacs)
|
Previous close (Rs)
|
Support
(Rs)
|
Resistance (Rs)
|
ICICI Bank
|
252.31
|
307.95
|
304.15
|
312.30
|
Bank of Baroda
|
198.71
|
187.45
|
183.00
|
194.10
|
SBI
|
154.71
|
302.95
|
300.67
|
306.57
|
Hindalco
|
139.59
|
194.00
|
191.97
|
196.37
|
Tata Steel
|
133.70
|
486.25
|
481.02
|
494.07
|
Bharti Airtel has launched new plans for broadband services, offering double the data in lesser price.
Idea cellular has launched 4G internet services at Jaipur in the state of Rajasthan.
Axis Bank has trimmed home loan rate by up to 0.30% for its borrowers.
Kotak Mahindra Bank has raised over Rs 5,803 crore through Qualified Institutional Placement issue.