Daily Newsletter
NSE Intra-day chart (21 September 2018)
Top Gainers
Company NameClose% Change
Top Losers
Company NameClose% Change
World Indices
IndicesLast Trade% Change
Indices
IndicesLast Trade% Change
FII Activity(Rs. Cr)
DateMarketGross PurchaseGross SalesNet Change
Equity
Debt
Equity
Debt
Equity
Debt
 
Market Commentary 24 September 2018
Markets likely to make negative start amid feeble global cues

 

Extending southward journey for fourth straight session, Indian equity benchmarks ended the session on pessimistic note, with frontline gauges ending below their crucial 36,900 (Sensex) and 11,150 (Nifty) levels. Markets started the session on an optimistic note as sentiments remained upbeat with Prime Minister Narendra Modi's statement that the size of Indian economy would double to $5 trillion by 2022, with manufacturing and agriculture contributing $1 trillion each. Some support also came with report that India is hopeful of resolving the issue of tariffs on steel and aluminium with the US soon and both sides are engaged in finalising a trade package. Traders also got some support with report that the Reserve Bank eased norms for companies in the manufacturing sector to raise overseas funds and allowed Indian banks to market Masala Bonds in line with the government's measures to prop up the rupee. Traders took note of State Bank of India's report that Indian rupee may be set to recover as oil peaks out and investors realize the currency has been sold off too heavily amid the emerging-market rout. However, markets took U-turn and entered in red terrain in second half of the session after former Union Finance Minister P. Chidambaram blamed the government's heavy-handed approach to the NPA problem for the sharp decline in export credit. He said despite government's claims of taking steps to boost exports, the export credit had declined sharply to Rs 22,300 crore in June from Rs 39,000 crore in the same month in 2017. Sentiments also remain dampened as the EEPC India said that at a time when the country is grappling with the widening of the current account deficit (CAD), any move to raise import duty on steel or steel products would severely hit India's crucial engineering exports and rather lead to further expansion of the CAD. However, markets somehow managed to end off their day's lows amid Employment Provident Fund Organisation's (EPFO) data report that India created 9.51 lakh new jobs in the month of July 2018. As per the report, total 9,51,423 new payrolls were created during July 2018 as against 8,57,934 created in the previous month, registering a growth of 10.90%. Finally, the BSE Sensex declined 279.62 points or 0.75% to 36,841.60, while the CNX Nifty was down by 91.25 points or 0.81% to 11,143.10.

 

The US markets ended the lackluster day of trade mostly in red terrain on Friday. Despite the choppy trading on the day, the Dow climbed to another new record closing high. Next week's Federal Reserve meeting also kept some traders on the sidelines amid a quiet day on the U.S. economic front. The Fed is scheduled to announce it latest monetary policy decision next Wednesday and is widely expected to raise interest rates by another quarter point. The accompanying statement is likely to attract considerable attention along with Fed Chairman Jerome Powell's press conference as traders attempt to gauge the outlook for further rate hikes. Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets. The S&P 500 slipped 1.08 points or 0.04 percent to 2929.67 and Nasdaq was down by 41.28 points or 0.51 percent to 7986.96, while Dow Jones Industrial Average surged 86.52 points or 0.32 percent to 26,743.50.

 

Crude oil futures settled higher on Friday after briefly paring gains, as prices bounced around ahead of meeting of major oil producers in Algiers over the weekend. A report suggesting that major producers may increase production more in order to cover an expected shortfall in output from Iran briefly knocked prices lower. However, gains remain capped ahead of OPEC meeting at Algeria this weekend. OPEC and its allies are scheduled to meet on Sunday to discuss how to discuss production increases as U.S. sanctions restrict Iranian exports. Benchmark crude oil futures for October added 46 cents or 0.7 percent to settle at $70.78 a barrel on the New York Mercantile Exchange. November Brent crude gained 10 cents or 0.1% to settle at $78.80 a barrel on London's Intercontinental Exchanged.

 

Indian rupee appreciated against the American currency due to selling of dollar by exporters as well as banks. Traders took some support with report that the Reserve Bank eased norms for companies in the manufacturing sector to raise overseas funds and allowed Indian banks to market Masala Bonds in line with the government's measures to prop up the rupee. Rupee sentiments were also supported with Prime Minister Narendra Modi's statement that the size of Indian economy would double to $5 trillion by 2022, with manufacturing and agriculture contributing $1 trillion each. On the global front, the dollar rebounded from early lows and edged higher against most of its rivals but was still on track for its biggest weekly drop in seven months as stronger equity markets and rising bond yields fuelled a rush to buy riskier assets. Finally, the rupee ended at 72.20, 17 paise stronger from its previous close of 72.37 on Wednesday.

 

The FIIs as per Friday's data were net sellers in equity and debt segments both. In equity segment, the gross buying was of Rs 4286.89 crore against gross selling of Rs 6472.67 crore, while in the debt segment, the gross purchase was of Rs 462.17 crore with gross sales of Rs 2514.75 crore. Besides, in the hybrid segment, the gross buying was of Rs 10.73 crore against gross selling of Rs 9.42 crore.

 

The US markets ended mostly in red on Friday, ahead of Federal Reserve meeting amid a quiet day on the U.S. economic front. The Fed is scheduled to announce it latest monetary policy decision on Wednesday and is widely expected to raise interest rates by another quarter point.  Asian markets were trading mostly lower on Monday, as China canceled upcoming tariff talks with the United States, while oil prices jumped after top producers including Russia ruled out boosting crude output. Indian equity benchmarks, extending their losing streak for fourth straight session, saw wild movements on either side on Friday before finishing notably lower, dragged down by financials. Today, the markets are likely to make cautious start on weak global cues as trade tension continues to rise. Traders may remain concern on industry chamber CII's report that over 40 per cent of Indian firms expect the Reserve Bank of India (RBI) will go in for another interest rate hike in the current fiscal. A CII release said that its quarterly Business Confidence Index (BCI), conducted during July-September 2018, covered nearly 200 firms of varying sizes. In the current survey, about 42 per cent of the respondents felt that the RBI will engage in further interest rates hikes in 2018-19 as compared to the previous survey where a majority of the respondents anticipated a cut or no change in policy rates in 2018-19. Sentiments may also remain dampen with report that overseas investors have pulled out a massive Rs 15,365 crore from the capital markets till September 21, after putting in funds during the previous two months, on widening current account deficit coupled with global trade tensions. However, traders will get some support later in the day with Fitch Ratings increasing India's growth forecast for the current fiscal to 7.8 percent, from 7.4 percent projected earlier. In its Global Economic Outlook, Fitch, however, flagged tightening of financial conditions, rising oil bill and weak bank balance sheets as headwinds to growth. Some support may also come with report that the southwest monsoon is expected to start withdrawing towards the end of this month, nearly a month behind schedule. This year's delayed withdrawal is likely to help the country avoid a drought situation, even as countrywide rainfall is hovering on borderline drought conditions, measuring 10% below normal levels since the beginning of the monsoon season. Meanwhile, State-run Garden Reach Shipbuilders and Engineers will open its initial public offering for subscription on September 24 with a price band of Rs 115-118 per share.

 

Support and Resistance: NSE (Nifty) and BSE (Sensex)

 

Index

Previous close

Support

Resistance

NSE Nifty

11,143.10

10,890.77

11,371.12

BSE Sensex

36,841.60

36,060.41

37,556.01

 

Nifty Top volumes

 

Stock

Volume

Previous close (Rs)

Support  (Rs)

Resistance (Rs)

(in Lacs)

Yes Bank

2,935.53

226.50

200.63

269.83

Vedanta

423.61

230.45

222.60

236.80

SBI

393.08

270.60

256.18

282.23

ICICI Bank

341.69

317.10

305.73

331.08

Axis Bank

247.89

599.20

563.73

634.33

 

  • Infosys has entered into an exclusive partnership with Trinity College to create new educational programs. 
  • Power Grid Corporation of India has received an investment approval for Communication System under Eastern Region Fibre Optic Expansion Project (Additional Requirement). 
  • Wipro has partnered with two leading UK academic institutions for strengthening STEM education in state schools in the United Kingdom. 
  • Reliance Industries has permanently shut down its only oil field in the Block KG-DWN-98/3.
News Analysis