Key equity bourses settled
Wednesday's session almost flat with negative bias. Start of the trading
session was cheerful, as the Reserve Bank of India (RBI) said that it will
inject Rs 37,500 crore into the system through the purchase of government
securities in February to increase liquidity. The RBI also said it has been
monitoring the evolving liquidity conditions and durable liquidity requirements
of the system. In early deals, traders were seen taking encouragement with
Commerce and Industry Minister Suresh Prabhu's statement that India is
optimally leveraging digital technologies to offer various services for
citizens and is poised to take full advantage of new generation of
technological advancements. He said that digital technologies are advancing and
becoming all pervasive. Some relief also came with credit rating agency, ICRA's
report stating that while the number of insolvency cases are expected to pile
up over the next few quarters, timely conclusion of cases within the law
mandated 180-270 days can free up as much as Rs 67,000 crore to the system.
However, the markets soon turned volatile to end the lackluster day in negative
terrain, as anxiety spread among the investors after S&P Global Ratings
warned that corporate activities which are designed to support the Indian
government's budgetary coffers -- such as share buyback -- by public sector
undertakings (PSUs) are credit negative for such entities. Some concern also
came with a report that the United States and China launch a critical round of
trade talks amid deep differences over US demands for structural economic
reforms from Beijing that will make it difficult to reach a deal before a March
2 US tariff hike. Positive opening of European markets failed to give support
to the Indian markets. The market participants paid no heed towards the annual
index releasing 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. Finally, the BSE Sensex lost 1.25 points to 35,591.25, while the CNX
Nifty was down by 0.40 points to 10,651.80.
The US markets settled higher on
Wednesday, with the Dow Jones Industrial Average reclaiming 25,000 level for
the first time in over a month, after the Fed announced its widely expected
decision to leave interest rates unchanged and indicated the central bank will
remain patient regarding further rate hikes. The Fed said following a two-day
meeting it has decided to maintain the target range for the federal funds rate
at 2.25 to 2.50 percent. The accompanying statement included some notable
changes from last month, including dropping a reference to the Fed's plan for
further gradual rate increases. The central bank also removed a sentence
describing the risks to the economic outlook as roughly balanced. Besides, strong
earnings from Boeing and Apple also boosted the markets. On the economic front,
reflecting several negative factors, the National Association of Realtors (NAR)
released a report unexpectedly showing a continued decrease in US pending home
sales in the month of December. NAR said its pending home sales index tumbled
by 2.2 percent to 99.0 in December after falling by 0.9 percent to a downwardly
revised 101.2 in November. A pending home sale is one in which a contract was
signed but not yet closed. Compared to the same month a year ago, pending home
sales plunged by 9.8 percent, reflecting the twelfth straight month of annual
decreases. Meanwhile, after reporting a substantial increase in US private
sector employment in the previous month, payroll processor ADP released a
report showing the pace of job growth slowed in January but still far exceeded
analyst estimates. ADP said private sector employment jumped by 213,000 jobs in
January after soaring by a downwardly revised 263,000 jobs in December. Dow
Jones Industrial Average surged 434.90 points or 1.77 percent to 25014.86,
Nasdaq rose 154.79 points or 2.20 percent to 7183.08 and S&P 500 was up by
41.05 points or 1.55 percent to 2681.05.
Crude oil futures ended higher on
Wednesday with weekly domestic crude supplies up less than expected and US
sanctions on Venezuela's state-run oil company lifting oil prices to their
highest finish in over two months. The Energy Information Administration (EIA)
reported that domestic crude supplies edged up by 900,000 barrels for the week
ended January 25. Gasoline stockpiles fell by 2.2 million barrels last week,
while distillate stockpiles were down 1.1 million barrels. Besides, trade
tensions between the US and China continue to hang over energy trading, raising
expectations for a slowdown in energy demand. China triggered the legal process
for the World Trade Organization to hear its challenge to US tariffs imposed on
$234 billion of goods. Benchmark crude oil futures for March rose 92 cents or
1.7 percent to settle $54.23 a barrel on the New York Mercantile Exchange.
March Brent crude gained 33 cents or 0.5 percent to settle at $61.65 a barrel
on London's Intercontinental Exchange.
In line
with equity market, Indian rupee ended almost flat against dollar on Wednesday,
amid strengthening American currency and rising crude prices. Traders remained
on sidelines ahead of upcoming Union Budget. Some concern also came with report
that the United States and China launch a critical round of trade talks amid
deep differences over US demands for structural economic reforms from Beijing
that will make it difficult to reach a deal before a March 2 US tariff hike.
However, losses remained capped as traders found some support with the annual
index releasing 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. On the global front, pound nursed losses on Wednesday on fresh concerns
about the possibility of a no-deal Brexit, while the dollar held steady ahead
of the Federal Reserve's policy decision. Finally, the rupee ended at 71.12, 1
paise weaker from its previous close of 71.11 on Tuesday.
The FIIs as per Wednesday'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 6129.01 crore against gross
selling of Rs 6405.33 crore, while in the debt segment, the gross purchase was
of Rs 1020.48 crore with gross sales of Rs 946.79 crore. Besides, in the hybrid
segment, the gross buying was of Rs 1.03 crore against no selling.
The US markets rose on Wednesday
after the Federal Reserve said it would be patient in lifting borrowing costs
further this year, reassuring investors worried about a slowing economy. Asian
markets were trading mostly in green in early trade on Thursday following
overnight gains on Wall Street amid easing growth concerns. Indian markets
ended range-bound session almost flat with negative bias on Wednesday as late
hour sell-off mainly dragged the indices below their neutral lines amid
US-China trade talks. Today, the markets are likely to make gap-up opening of
F&O expiry session, mirroring firm global cues after the US Federal Reserve
signaled a pause in interest rate hikes. Traders will be getting encouragement
with SBI Research's report that the government meeting the fiscal targets this
year and for FY20, fiscal deficit is likely to be Rs 6.72 trillion or 3.2
percent of GDP, assuming a modest 11.7 percent of nominal GDP growth. It added
that for FY19 the fiscal gap will be met at the budgeted 3.3 percent. There
will be some support with Commerce Minister Suresh Prabhu's statement that the
government will release the new e-commerce policy soon which is awaiting
approval from the Department of Industrial Policy and Promotion (DIPP). Traders
may take note of a report that the GST
officials are working out mechanism to prompt taxmen to initiate profiteering
complaints, which could be taken up for further investigation by the
Directorate General of Anti-Profiteering. Currently, only consumers file complaints
against businesses for not passing on the benefits of reduction of the rates of
Goods and Services Tax (GST) on various products. Meanwhile, SEBI has proposed
a new set of framework for REITs and InvITs in order to provide flexibility to
the issuers in terms of fund raising and increasing the access of these
investment vehicles to investors. There will be some buzz in the textiles
sector stocks with India Ratings' report that India's textiles sector may see
higher growth following robust domestic demand and depreciating rupee value. It
has maintained a stable outlook for the textile sector for 2019-20 following
strong domestic demand, waning impact of the disruptions due to GST and
demonetisation and rising exports aided by a weak rupee. There will be some
reaction in renewable energy sector stocks with ICRA's report that renewable
energy is set to witness 10,000 megawatt (Mw) in fresh capacity addition in
FY20, aided by project awards from central agencies and state-owned
distribution utilities. 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
|
10,651.80
|
10,606.37
|
10,703.72
|
BSE Sensex
|
35,591.25
|
35,438.01
|
35,797.45
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Yes Bank
|
653.12
|
199.50
|
194.53
|
208.23
|
Axis Bank
|
469.12
|
690.95
|
682.02
|
701.62
|
ICICI Bank
|
394.00
|
365.90
|
355.07
|
372.67
|
SBI
|
189.09
|
287.45
|
282.00
|
291.15
|
IOC
|
166.13
|
134.55
|
132.13
|
137.48
|
Tata Steel has restarted blast furnace at UK's largest steelworks at Port Talbot in Wales at a cost of tens of millions of pounds.
Qatar Investment Authority has agreed to invest $200 million through a primary equity issuance in Airtel Africa, a subsidiary of Bharti Airtel.
L&T has proposed to sell up to 30 lakh shares of L&T Technology Services, representing 2.89 per cent of its total paid up equity share capital.
Bajaj Auto has reported a rise of 20.49% in its net profit at Rs 1,220.77 crore for Q3FY19 as compared to Rs 1,013.16 crore for Q3FY18.