Extending
previous session's southward journey, Indian equity benchmarks ended the dismal
day of trade with a cut of over half a percent on Friday. Sentiments remained
downbeat since morning as markets after a negative start never looked confident
and extended their southward journey to end below their crucial 35,000 (Sensex)
and 10,650 (Nifty) levels. The domestic sentiments remained cautious with a
report stating that bank deposit growth falls to a five-decade low to 6.7
percent in the fiscal year ended March 2018. Bankers said the reversal from the
huge deposits post demonetisation and the steady movement of savings away from
bank deposits has hit growth. Anxiety also remained on the street with the
credit ratings agency, ICRA's latest report that the high quantum of
non-performing asset (NPA) will restrict the overall bank credit growth to a
moderate 7-8% in fiscal 2018-19, despite recapitalisation of public sector
banks (PSBs) and private sector players upping their game with a 25 percent
credit growth. It also said that India Inc will borrow more from cheaper
sources abroad. Traders failed to take any sense of relief with report
highlighting that private equity and venture capital investments in India
reached $7.9 billion across 180 deals in January-March this year, the best
first quarter since 2008, mainly driven by large transactions. Market
participants shrugged off report that China has removed import duties on as
many as 28 medicines, including all cancer drugs, from May 1, a move which
would help India to export these pharmaceuticals to the neighbouring country.
The investors also paid no heed towards the report stating that activity in
India's services sector grew at the fastest pace in month of April, on the back
of greater inflows of new work. According to the survey report, the seasonally
adjusted Nikkei Services Business Activity Index remained above the neutral
mark of 50.0 in April, posting reading at 51.4, up from 50.3 in March. The
Nikkei India Composite PMI Output Index which measures both manufacturing and
services too climbed to 51.9 in April from 50.8 in March. Finally, the BSE
Sensex declined 187.76 points or 0.53% to 34,915.38, while the CNX Nifty was
down by 61.40 points or 0.57% to 10,618.25.
The US markets closed higher on
Friday, with major indexes shaking off an early slide as technology stocks -
notably Apple Inc. - rallied, overshadowing uncertainty over tense trade talks
between the US and China and a weaker-than-expected rise in April nonfarm
payrolls. Friday's gains were broad based, with all 11 S&P 500 sectors
higher on the day. Tech was by far the biggest boost to markets, though,
gaining 2%. Friday's gains weren't enough to push the Dow and S&P into
positive territory for the week, with both posting 0.2% weekly declines. The Nasdaq
turned positive for the five-session stretch, however, up 1.3%. On the economy
front, the economy generated a solid 164,000 jobs in April to push the
unemployment rate below 4% for the first time since Bill Clinton was president,
a sign the surging labor market shows no signs ebbing. The increase in hiring
fell short of the 188,000 forecast, but the shortfall was cushioned by upward
revisions that show the US created more jobs in March than originally reported.
The unemployment rate, meanwhile, slipped to 3.9% after holding at 4.1% for six
months in a row. Despite the ultra-tight jobs market, wages for American
workers still aren't rising rapidly. The Dow Jones Industrial Average added
332.36 points or 1.39 percent to 24,262.51, the Nasdaq gained 121.466 points or
1.71 percent to 7,209.62, and the S&P 500 was up by 33.69 points or 1.28
percent to 2,663.42.
Crude oil
futures to their highest since November 2014, picking up 2.4% for the week, as
rising worries over the economic crisis in Venezuela and possible new sanctions
against Iran increased the potential for tighter global crude supplies and sent
prices back to their highest settlement since late 2014. Venezuela and Iran are
both members of the Organization of the Petroleum Exporting Countries. An OPEC
survey conducted by S&P Global Platts showed Friday that the group's crude
production in April fell for a third straight month to a one-year low. Benchmark
crude oil futures for June delivery jumped by $1.29 or 1.90 percent to settle
at $69.72 a barrel on the New York Mercantile Exchange. July Brent crude gained
$1.25 or 1.70 percent to settle at $74.87 a barrel on London's Intercontinental
Exchange.
Indian
rupee ended considerably weaker against the US dollar on Friday, on the back of
consistent demand for the greenback from state-run banks and importers. Traders
remained concerned with ICRA's report highlighting that high quantum of
non-performing asset (NPA) will restrict the overall bank credit growth to a
moderate 7-8% in fiscal 2018-19, despite recapitalisation of public sector
banks (PSBs) and private sector players upping their game with a 25 percent
credit growth. Moreover, persistent fall in equity market together with dollar
rose to a position of strength overseas added some extra pressure. Market
participants shrugged off report that activity in India's dominant service
sector accelerated in April thanks to a pickup in new business that encouraged
firms to hire at the fastest pace in seven years. The Nikkei/IHS Markit
Services Purchasing Managers' Index (PMI) rose to a three-month high at 51.4 in
April from March's 50.3, holding above the 50-mark that separates growth from
contraction for a second month. On the global front, dollar rose against most
major currencies on Friday, heading for a third straight week of gains as
traders counted down to the closely watched U.S. jobs report. Finally, the
rupee ended at 66.87, 23 paise weaker from its previous close of 66.64 on
Thursday.
The FIIs as per Friday'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 5694.16 crore against gross selling of Rs 5783.87
crore, while in the debt segment, the gross purchase was of Rs 852.12 crore with
gross sales of Rs 813.18 crore. Besides, in the hybrid segment, the gross selling
was of Rs 1.24 crore against no buying.
The US markets ended higher on
Friday as investors reacted positively to the Labor Department's closely
watched monthly employment report. The Labor Department said non-farm payroll
employment climbed by 164,000 jobs in April. Asian markets were trading mixed
on Monday despite the strong showing on Wall Street as investors digested last
week's trade talks and U.S. jobs numbers. Indian markets ended in red on Friday
as traders remained on sidelines ahead of Karnataka state elections scheduled
to be held on May 12. Today, the markets are likely to make flat-to-negative
start as underlying sentiment may remain cautious amid rising oil prices and
mixed Asian cues. Traders also keep an eye on macro data on industrial output
and inflation. Traders will remain concern after Srini Raju, Member of the ISB
Executive Board, cautioning against the possibility of trade imbalances if
corrective measures are not taken, said India may have to shell out huge forex
reserves in the changing economic order. However, traders will get some
encouragement later in the day with ADB Chief Economist Yasuyuki Sawada's
statement that India's projected GDP growth of over 7 per cent for the current
fiscal is amazingly fast and if this momentum is maintained the size of the
economy can double within a decade. The country shouldn't worry about not
achieving 8 per cent growth but focus on increasing domestic demand by reducing
the income inequality, he said. Traders will also get some support with
Commerce and Industry Minister Suresh Prabhu's statement that the government is
working on a strategy to promote services exports which have the potential to
boost overall foreign shipments and economic growth. There will be some important
earnings announcements too, to keep the markets buzzing.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
10,618.25
|
10,579.75
|
10,678.60
|
BSE Sensex
|
34,915.38
|
34,773.14
|
35,132.08
|
Nifty Top volumes
Stock
|
Volume
|
Previous close
(Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Vedanta
|
160.87
|
281.65
|
276.87
|
288.57
|
Bharti Airtel
|
144.15
|
396.75
|
387.72
|
412.07
|
SBI
|
127.77
|
241.95
|
240.23
|
243.78
|
Power Grid
|
126.37
|
207.40
|
205.33
|
208.63
|
Yes Bank
|
122.42
|
345.10
|
340.28
|
353.83
|
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