Indian equity bourses carried on
their weak run on Tuesday, with Sensex and Nifty closing the day below their
crucial levels of 35,600 and 10,700, respectively. The markets made a cautious
start of the day, tracking other weak Asian markets. Anxiety spread on the
street, after the Income Tax Department launched searches at 74 places in Tamil
Nadu in connection with a tax evasion probe against some real estate groups and
a retail store chain in the state. Investors also took note of a report that
the Income Tax Department has confiscated assets worth Rs 6,900 crore till now
as part of its action under the anti-benami transactions law. Domestic
sentiments remained lackluster throughout the day, even after Finance Minister
Piyush Goyal urged public sector banks (PSBs) to step up lending to micro,
small and medium enterprises (MSMEs), agriculture and housing sectors and also
assured these lenders of all kinds of support. Goyal in its meeting with the
heads of PSU banks discussed internal mechanism to resolve cases under the RBI
guidelines and within the framework set in the bankruptcy court. However, key
indices managed to come off their intraday low points in the last leg of the
trade, taking support from the Reserve Bank of India's (RBI) latest data report
that foreign direct investment (FDI) during the previous fiscal grew 18 per
cent to Rs 28.25 lakh crore. As per data, FDI increased by Rs 4,33,300 crore, including
revaluation of past investments, during 2017-18 to reach Rs 28,24,600 crore in
March 2018 at market value. The RBI said as many as 23,065 companies responded
to the latest round of the census, of which, 20,732 firms had FDI or ODI in
their balance sheet in March 2018. Some relief also came after RBI Governor
Shaktikanta Das asked PSBs to extend credit while observing prudential norms
without getting excessively conservative. He highlighted the importance of PSBs
for the economy at all times and especially at the current juncture in helping
meet broader economic goals. Finally, the BSE Sensex lost 64.20 points or 0.18%
to 35,592.50, while the CNX Nifty was down by 9.35 points or 0.09% to
10,652.20.
The US markets ended mostly in
red on Tuesday as investors sorted through a fresh batch of earnings reports
and awaited clarity from the Federal Reserve on its monetary policy plans. The
Federal Reserve's impending monetary policy announcement on Wednesday kept some
traders on the sidelines along with the upcoming release of the Labor
Department's monthly jobs report on Friday. Traders also continued to express
uncertainty about trade talks between the US and China after the Justice
Department unsealed sweeping criminal charges against Chinese tech giant Huawei
and its chief financial officer Meng Wanzhou. On the economic front, the
Conference Board released a report showing a substantial deterioration in
consumer confidence in the month of January. The Conference Board said its
consumer confidence index slumped to 120.2 in January after tumbling to a
revised 126.6 in December. Street had expected the consumer confidence index to
fall to 124.3 from the 128.1 originally reported for the previous month. Lynn
Franco, Senior Director of Economic Indicators at the Conference Board, noted
expectations saw a significant drop due to financial market volatility and the
government shutdown. Nasdaq declined 57.40 points or 0.81 percent to 7028.29
and S&P 500 was down by 3.85 points or 0.15 percent to 2640.00, while Dow Jones
Industrial Average gained 51.74 points or 0.21 percent to 24579.96.
Crude oil futures settled higher
on Tuesday on account of the US Treasury's decision to impose sanctions on
Venezuela's state-owned oil firm, Petroleos de Venezuela SA. The US Treasury
sanctioned Venezuela's oil firm, raising the risk of disruptions to oil supply
from the South American nation, home to the world's largest oil reserves.
Venezuela's oil firm is also known as PdVSA. The sanctions will result in more
than $11 billion in export losses for Venezuela over the next year. Meanwhile,
trade tensions between the US and China continue to hang over energy trading,
raising expectations for a slowdown in energy demand. Benchmark crude oil
futures for March surged $1.32 or 2.5 percent to settle $53.31 a barrel on the
New York Mercantile Exchange. March Brent crude gained $1.39 or 2.3 percent to
settle at $61.32 a barrel on London's Intercontinental Exchange.
Indian
rupee ended almost flat against dollar on Tuesday, amid strengthening American
currency and rising crude prices. Traders also remained on sidelines ahead of
Budget announcements due later this week. However, traders took some support
with the Reserve Bank of India's (RBI) latest data report that foreign direct
investment (FDI) during the previous fiscal grew 18 per cent to Rs 28.25 lakh
crore. As per data, FDI increased by Rs 4,33,300 crore, including revaluation
of past investments, during 2017-18 to reach Rs 28,24,600 crore in March 2018
at market value. The RBI said as many as 23,065 companies responded to the
latest round of the census, of which, 20,732 firms had FDI or ODI in their
balance sheet in March 2018. On the global front, Sterling firmed a touch on
Tuesday but held well off recent multi-month highs against the euro and dollar
as traders weighed up whether lawmakers would back a key parliamentary
amendment that would effectively take a no-deal Brexit off the table. Finally,
the rupee ended at 71.11, 1 paise weaker from its previous close of 71.10 on
Monday.
The FIIs as per Tuesday's data
were net sellers in equity and debt segments both. In equity segment, the gross
buying was of Rs 6429.14 crore against gross selling of Rs 6506.18 crore, while
in the debt segment, the gross purchase was of Rs 1132.71 crore with gross
sales of Rs 1274.70 crore. Besides, in the hybrid segment, the gross buying was
of Rs 0.88 crore against no selling.
The US markets ended mostly lower
on Tuesday as investors sorted through a fresh batch of earnings reports and
awaited clarity from the Federal Reserve on its monetary policy plans. Asian
markets were trading mixed on Wednesday as the earnings season rolled on and
investors awaited the Federal Reserve's policy meeting. Indian markets made
recovery in last leg of trade on the back of short-covering by traders but
failed to hold head above water and ended lower for third straight session on
Tuesday. Today, the markets are likely to make cautious start amid mixed global
cues on US-China trade tiff. However, traders may take some support later in
the day with Icra's report that the number of insolvency cases is expected to
pile up over the next few quarters, the timely conclusion of cases within the
law-mandated 180-270 days can free up as much as Rs 67,000 crore to the system.
Traders may also take note of the annual index released by an anti-graft
watchdog that India has improved its ranking on a global corruption index in
2018, while its neighbour China lagged far behind. Besides, India Ratings has
said income support as a core centrally sponsored scheme is a better option
than debt waiver. Meanwhile, Commerce and Industry Minister Suresh Prabhu said
that India is optimally leveraging technology to offer various services on
digital platforms and is poised to take full advantage of new generation of
technological advancements. There will be some reaction in banking sector
stocks with SBI in its Ecowrap report stating that Public sector banks (PSBs)
would require another Rs 50,000 crore fund infusion in 2019-20 to help enable
credit growth of 11 per cent. There will be some buzz in the public sector
undertakings (PSUs) stocks with S&P Global Ratings' statement that the
Centre's bid to boost its non-debt capital receipts by pushing the cash-rich
central PSUs to buy back their own shares has impacted the credit profile of
these firms. It said corporate activities that are designed to support the
government coffers by PSUs are ‘credit negative' for such entities. There will
be some reaction in auto ancillary stocks with report that to promote domestic
assembling of electric vehicles, the government lowered customs duty on import
of parts and components of such vehicles to 10 to 15 percent. Until now,
vehicle parts and components imported for assembly in India attracted import
duty of 15 to 30 percent. There will be lots of important earnings
announcements too, to keep the markets in action.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,652.20
|
10,593.78
|
10,700.48
|
BSE Sensex
|
35,592.50
|
35,400.63
|
35,759.26
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
766.51
|
202.90
|
195.92
|
209.67
|
ZEEL
|
374.36
|
377.40
|
363.93
|
389.68
|
ICICI Bank
|
207.38
|
346.85
|
342.10
|
350.85
|
Indiabulls Housing Finance
|
175.22
|
698.60
|
649.07
|
749.07
|
SBI
|
174.36
|
280.60
|
276.10
|
285.55
|
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M&M has entered into a partnership with Greaves Cotton to source BS-VI emission norms compliant powertrain solutions.
Tata Motors' wholly owned subsidiary -- JLR has launched a special landmark edition of Discovery Sport priced at Rs 53.77 lakh, ex-showroom.