Snapping a four-session gaining
run, Indian equity benchmarks ended Wednesday's trade on a negative note with
losses of over one and half percent, tracking a selloff in banking, telecom and
financial stocks and weak cues from global markets. Key gauges kicked off
session in the green, as the Finance Ministry cited green shoots of recovery in
agriculture, manufacturing and services sectors, and said the prompt policy
measures taken by the government and RBI have helped reinvigorate the economy
with minimal damage. Sentiments remained positive with Fitch Solutions'
statement that the country's farm trade, which was disrupted during the
COVID-19 lockdown due to logistic issues in March-June, is expected to rebound
in the second half of the calendar year 2020.
Some optimism also came with a private report stating that unemployment
rate in the country dropped sharply to pre-lockdown level at 8.5% in the third week
of June, after reaching a peak to 27.1% in the first week of May due to the
lockdown. However, Indian indices pared all their gains and witnessed heavy
selling pressure in the second half of the session, as traders turned cautious,
with ratings agency S&P Global Ratings' statement that companies in India
face further potential rating downside if the recovery in corporate earnings is
prolonged beyond 18 months. About 35 per cent of credit ratings on Indian
corporates have either a negative outlook or are on CreditWatch with negative
implications. Domestic sentiments also got hit after India Ratings and Research
in its report said that India's economy is likely to shrink by 5.3 per cent
this fiscal, the lowest GDP growth in the Indian history and the sixth instance
of economic contraction. Finally, the BSE Sensex lost 561.45 points or 1.58% to
34,868.98, while the CNX Nifty was down by 165.70 points or 1.58% to 10,305.30.
The US markets ended sharply
lower on Wednesday as investors worried that rising coronavirus cases in many
American states will set back economic recovery. Fueling the renewed concerns,
Florida and California both reported their single biggest daily increases in
new cases of COVID-19. Florida's Department of Health confirmed 5,508 new cases
on Tuesday, while the California Department of Public Health reported an
additional 7,149 cases. New York, New Jersey and Connecticut announced 14-day
quarantines on visitors from states with high COVID-19 infection rates. The
travel advisory, which impacts residents of nine states, raises concerns about
the pace of business activity resuming after lockdowns imposed to contain the
spread of the pandemic. The nation's seven-day average of daily new Covid-19
cases spiked more than 30 percent compared with a week ago. On the international
trade front, the US is considering imposing tariffs on some $3.1 billion worth
of goods from France, German, Spain and the UK, on products, including beer,
gin, olives and trucks, also creating headwinds for stocks and igniting fears
of a fresh trade war as the American economy reels from the pandemic. The Trump
administration also has been threatening to re-imposing tariffs on imports of
aluminum from Canada on July 1 as the new USMCA, or the United States Mexico
Canada Agreement, which replaced the North American Free Trade Agreement, is
set to take effect. Meanwhile, the International Monetary Fund (IMF) cut its
economic forecast for 2020, saying that the coronavirus pandemic has caused an
unprecedented decline in global activity. The IMF dropped its global economic
growth expectations for this year to negative 4.9%. That's almost two
percentage points lower than three months ago.
Crude oil futures ended deeply in
red on Wednesday on rise in coronavirus cases. The World Health Organization
pointed to rising cases of coronavirus in the US, China, Latin America,
reigniting worries of a possible second wave of the epidemic. Further oil
prices also fell as US government data reveal a third straight weekly climb in
domestic crude inventories. The Energy Information Administration reported that
US crude inventories rose for a third week in a row, by 1.4 million barrels for
the week ended June 19. That compared with a forecast by S&P Global Platts
for an average decline of 100,000 barrels. The American Petroleum Institute on
Tuesday reported a climb of roughly 1.7 million barrels. Crude oil futures for
August dropped $2.36 or 5.9 percent to settle at $38.01 a barrel on the New
York Mercantile Exchange. August Brent crude fell $2.32 or 5.4 percent to
settle at $40.31a barrel on London's Intercontinental Exchange.
Indian rupee ended weaker against
the US dollar on Wednesday, on increased demand for the greenback from
importers and banks. Traders remain concerned with Chief Economic Advisor (CEA)
Krishnamurthy V Subramanian's statement that shutting the doors to other
countries will not help India. His comments came after the nationwide clamour
for a boycott of Chinese goods is getting louder, following the fierce clash
between the troops of India and China in eastern Ladakh that left 20 Indian
Army personnel dead. Broad strength in US dollar also weighed on the rupee. On
the global front; dollar regained some ground on Wednesday after two straight
days of losses, as money markets tempered hopes of a rapid global economic
recovery. Finally, the rupee ended at 75.72, 6 paise weaker from its previous
close of 75.66 on Tuesday.
The FIIs as per Wednesday's data
were net buyers in both equity and debt segments. In equity segment, the gross
buying was of Rs 5041.59 crore against gross selling of Rs 4912.04 crore, while
in the debt segment, the gross purchase was of Rs 1150.35 crore with gross
sales of Rs 695.37 crore. Besides, in the hybrid segment, the gross buying was
of Rs 0.49 crore against gross selling of Rs 7.06 crore.
The US markets settled sharply
lower on Wednesday as it seemed traders could no longer ignore the spiking
number of new coronavirus cases in several US states. Asian markets are trading
in red on Thursday as surging US coronavirus cases, global trade tensions and
an IMF downgrade to economic projections knocked confidence in a recovery.
Indian markets snapped a four-day winning streak and ended lower on Wednesday
on account of heavy selling in banking, pharma and metal stocks. Today, the
markets are likely to make gap-down opening tracking sell-off in the global
peers. Market participants will also react to the burgeoning Covid-19 cases in
India. The country saw a sharp spike of over 16,500 coronavirus cases. The
country's total count of infections now stands at 472,985. More than 14,900
have died from the highly contagious virus. Besides, there will be some
volatility in the markets as the F&O contracts for the June series are due
to expire today. Traders will be concerned as the International Monetary Fund
(IMF) projected a sharp contraction of 4.5 per cent for the Indian economy in
2020, a historic low, citing the unprecedented coronavirus pandemic that has
nearly stalled all economic activities, but said the country is expected to
bounce back in 2021 with a robust six per cent growth rate. However, some
support may come later in the day as Union Minister Nitin Gadkari launched the
Credit Guarantee Scheme for Sub-ordinate Debt to provide Rs 20,000 crore of
guarantee cover to two lakh micro, small and medium enterprises (MSMEs).
Meanwhile, in a relief for taxpayers, the Centre has extended the deadline for
filing income tax returns (original as well as revised) for FY2018-19 to July
31, 2020. The last date for filing income tax returns for FY2019-20 has also
been extended to November 30, 2020. Besides, easing compliance requirements due
to continuing adverse impact of the coronavirus pandemic, market regulator SEBI
gave another month's extension till July 31 to listed companies for submitting
their fourth-quarter as well as annual results. There will be some buzz in the
banking stocks as the government decided to bring Urban Co-operative Banks
(UCBs) and Multi-State Co-operative Banks under the governance of the Reserve
Bank of India (RBI). Metal stocks will be in focus with a private report that Aluminium
Association of India (AAI) has approached the ministry of finance and the
ministry of commerce and Industry to implement remission of duties or taxes on
export products (RoDTEP) scheme, a move aimed to compete and substitute Chinese
aluminium exports to major economies in the world.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,305.30
|
10,207.12
|
10,478.32
|
BSE Sensex
|
34,868.98
|
34,540.42
|
35,452.04
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Motors
|
1,254.62
|
104.80
|
102.40
|
109.00
|
State Bank of India
|
746.70
|
184.60
|
180.70
|
191.70
|
ICICI Bank
|
579.56
|
348.10
|
335.40
|
370.40
|
ITC
|
546.53
|
191.85
|
187.10
|
195.65
|
IndusInd Bank
|
432.58
|
481.70
|
461.72
|
516.07
|
Wipro has been awarded a strategic, multiyear infrastructure modernization and digital transformation services engagement by Germany based energy company E.ON.
Cipla is going to price its generic version of antiviral drug remdesivir at less than Rs 5,000 per vial in keeping with its conviction of providing access to the medicines at affordable cost.
Asian Paints has reported 2.07% fall in its consolidated net profit attributable to owner of Rs 461.89 crore for Q4FY20 as against Rs 471.65 crore for Q4FY19.
Maruti Suzuki India has launched distinctive loyalty program - Maruti Suzuki Rewards.