Indian equity benchmarks wrapped
up a volatile session on pessimistic note on Tuesday, with losses of over half
a percent. The markets made a cautious opening of the day to trade choppy,
impacted by the Reserve Bank of India's (RBI) latest data report stating that
investment of Indian companies in their overseas ventures declined by 47.08% to
$1.54 billion in September 2018, as compared to $2.91 billion invested in their
joint ventures (JVs) and wholly-owned subsidiaries (WoS) abroad during
September 2017. Domestic sentiments remained under pressure, as with private
report indicated that high oil prices are hurting consumers and could also have
adverse implications for producers. Major emerging Asian economies such as
India and Indonesia have been hit hard this year by rising crude oil prices.
Adding more worries among market participants, Crisil's latest report stated
that depreciating rupee puts nearly half of the solar power capacities under
implementation worth around Rs 28,000 crore at viability risk. The report also
noted that import of solar modules has got costlier due to rupee fall and
increased the cost of setting up solar plants. In the last hours of the trade,
the markets weaken further, as Finance Minister Arun Jaitley criticised the
Reserve Bank of India for failing to check indiscriminate lending during 2008
and 2014 that has led to the present bad loan or NPA crisis in the banking
industry. The traders overlooked Economic Affairs Secretary Subhash Chandra
Garg's statement that the government is trying to find ways to ensure stability
of FPI fund flows into the financial markets. He also said developments like
bond yield cycle, taxation reforms, in the US have not hurt Foreign Direct
Investment (FDI) flow into the country. The street also failed to take any
sense of relief with Commerce and Industry Minister Suresh Prabhu's statement
that the government will work on promoting the growth of the education sector
to help increase the share of overall service sector in the country's economy.
Meanwhile, India and Japan signed a pact to raise the scope of a bilateral
currency swap arrangement to a record $75 billion, aimed at bringing in greater
stability in the foreign exchange and capital markets, amid a slide in the
rupee in recent months. Finally, the BSE Sensex lost 176.27 points or 0.52% to
33,891.13, while the CNX Nifty was down by 52.45 points or 0.51% to 10,198.40.
Snapping two-day losing streak,
the US markets ended significantly higher on Tuesday as President Donald Trump
signaled that the US is ready to reach a deal to ease trade tensions with
China, giving the market some much-needed relief. However, trading was volatile
with the indexes choppy partly on the back of tariff worries amid fears about
global growth and peak earnings. President Donald Trump's prediction the US
will reach a great deal with China on trade offset some of the concerns,
although the president also warned of more tariffs if a deal is not possible.
The comments from Trump came after a private report said the US is preparing to
announce tariffs on all remaining Chinese imports if next month's talks between
Trump and Chinese President Xi Jinping fail to ease the trade war. Trump and Xi
are expected to meet on the sidelines of a Group of 20 summit in Buenos Aires,
Argentina, beginning November 30. Adding optimism, the Conference Board showed
a continued increase in consumer confidence in the month of September. The
Conference Board said its consumer confidence index rose to 137.9 in October
from a downwardly revised 135.3 in September. Street had expected the consumer
confidence index to drop to 136.3 from the 138.4 originally reported for the previous
month. With the increase, the consumer confidence index reached its highest
level since hitting 142.5 in September of 2000. Dow Jones Industrial Average
surged 431.72 points or 1.77 percent to 24,874.64, Nasdaq gained 111.36 points
or 1.58 percent to 7,161.65 and S&P 500 was up by 41.38 points or 1.57
percent to 2,682.63.
Crude oil futures extend losses
for second straight session on Tuesday and settled over 2-month low, as demand
growth concerns continued to weigh on the commodity. With global oil production
rising and the market moving towards a situation where supply may well overrun
demand, traders are wary of building up positions in crude futures. Meanwhile,
the US Energy Information Administration is slated to release its inventory
data on Wednesday. It is widely expected that US crude stockpiles may have
risen in the week ended October 26, increasing for a sixth successive week.
Benchmark crude oil futures for December lost 86 cents or 1.3 percent to settle
at $66.18 a barrel on the New York Mercantile Exchange. December Brent crude
declined $1.43 or 1.9 percent to settle at $75.91 a barrel on London's
Intercontinental Exchanged.
Indian
rupee ended significantly weaker against the Greenback on Tuesday, following
fresh demand for the US currency from banks and importers to meet the month end
dollar demand. Sentiments weakened with private report indicating that high oil
prices are hurting consumers and could also have adverse implications for
producers. Major emerging Asian economies such as India and Indonesia have been
hit hard this year by rising crude oil prices. Besides, a weak trend at Dalal
Street coupled with US dollar's gain against other currencies overseas weighed
on the local unit. On the global front, dollar remained firm against its
rivals, supported by a safe haven bid as rising trade tensions and fears of a
slowdown in global economic growth weighed on investors' appetite for risk
assets. Finally, the rupee ended at 73.68, 23 paise weaker from its previous
close of 73.45 on Monday.
The
FIIs as per Tuesday's data were net sellers in equity segment, while they were
net buyers in debt segment. In equity segment, the gross buying was of Rs
4447.50 crore against gross selling of Rs 6253.02 crore, while in the debt
segment, the gross purchase was of Rs 1228.89 crore with gross sales of Rs
432.96 crore. Besides, in the hybrid segment, the gross buying was of Rs 0.14
crore against gross selling of Rs 0.23 crore.
The US markets ended
significantly higher on Tuesday, helped by strong gains for chipand transport
stocks as investors took advantage of cheaper prices following a steep recent
pullback for equities. Asian markets were trading mostly in green on Wednesday,
thanks to a rebound on Wall Street. Indian markets witnessed a volatile trading
session with extreme swings between positive and negative zones and settled in
red territory on Tuesday amid lingering US-China trade war concerns and heavy
selling by foreign portfolio investors. Today, the markets are likely to make
positive start following strong global cues. Traders will be getting some
encouragement with a private report stating that India's long-term growth story
remains robust despite global headwinds as well as rupee depreciation and high oil
prices. It aaded that strain on India's external balance sheet has increased
due to slide in forex reserve, outflows in foreign investment, increased
current account deficit (CAD), rupee depreciation and high global crude oil
prices. Traders may take note of report that Commerce and Industry Minister
Suresh Prabhu hinted at improvement in India's ranking in the World Bank's ease
of doing business report, to be released on Wednesday. India jumped 30 places
to rank 100th among 190 nations in the last year's World Bank's ease of doing
business index. However, there may be some cautiousness with Reserve Bank of
India's report showing that India Inc's foreign borrowing more than halved to
$1.71 billion in September. Meanwhile, the high level the Financial Stability
and Development Council (FSDC) meeting chaired by Finance Minister Arun Jaitley
discussed liquidity issues being faced by the non-banking financial companies.
There will be some buzz in power sector stocks with report that the government
is looking to execute at least two mergers among central public sector
enterprises (CPSEs) in the power sector to step up the disinvestment process
and meet its target. Also, there will be some reaction in rubber industry
related stocks with report that the projected growth in the rubber consumption
which is a corollary to overall economic development of the country
necessitates the need to expand rubber production though the current prolonged
phase of natural rubber price crash has impacted the growers deeply. There will
be lots of earnings reaction based on the performance of the companies.
Support and Resistance: NSE
(Nifty) and BSE (Sensex)
Index
|
Previous
close
|
Support
|
Resistance
|
NSE Nifty
|
10,198.40
|
10,154.13
|
10,263.88
|
BSE Sensex
|
33,891.13
|
33,735.16
|
34,111.73
|
Nifty Top volumes
Stock
|
Volume
|
Previous
close (Rs)
|
Support (Rs)
|
Resistance
(Rs)
|
(in Lacs)
|
Yes Bank
|
434.28
|
182.05
|
178.50
|
187.75
|
ICICI Bank
|
344.60
|
345.70
|
341.12
|
352.07
|
SBI
|
334.02
|
273.15
|
266.40
|
279.50
|
Tata Motors
|
156.02
|
177.25
|
175.03
|
180.48
|
Vedanta
|
105.01
|
211.20
|
208.67
|
215.07
|
Tech Mahindra and Rakuten Mobile Network have entered into an agreement to set up 5G and 4G network labs in Tokyo and Bengaluru.
BPCL has reported a fall of 48.30% in its net profit at Rs 1,218.71 crore for Q2FY19 as compared to Rs 2,357.40 crore for Q2FY18.
Tata Steel has inaugurated Jubilee Park built by it at Chaibasa, as part of its commitment towards community development.
NTPC has entered into a contract with the Indian Railways for transportation of coal from mines to all its plants through fiscal 2020.