Halting their eight days of
decline, Indian equity benchmarks witnessed a relief rally and logged smart
gains on Wednesday as broad-based buying on the back of short covering and
uptick in European and select Asian indices aided the sentiment. Markets opened
on a positive note and continued to inch higher throughout the day as traders
took encouragement with Chief Economic Advisor V Anantha Nageswaran's statement
that high frequency data indicate buoyant economic growth momentum and the 7%
GDP growth estimate for the current fiscal is very realistic. Some optimism
also came as production of eight infrastructure industries - the core sector -
expanded 7.8% year-on-year (YoY) in January, its fastest pace in four months,
owing to a lower base and a near all-round showing. Buying further crept in as Moody's Investors
Service raised India's economic growth estimate for 2023 to 5.5 per cent from
4.8 per cent pegged earlier, on the back of a sharp increase in capital
expenditure in the Budget and a resilient economic momentum. Key indices
extended gains in late afternoon deals and settled near day's high points,
taking support from the second advance estimates of national income showing
that the Gross Value Added (GVA) in agriculture and allied activities is
projected to clock its best growth in FY23 during the October-to-December
quarter, at 3.7 per cent, on the back of a strong kharif harvest. In the third
quarter of FY22, GVA in the sector was 2.3 per cent at constant prices. Traders
paid no heed towards reports that India's gross domestic product (GDP) growth
rate fell for the second consecutive quarter in October-December, coming in at
4.4%, it is lower than the 6.3% growth in the second quarter of 2022-23. Traders also overlooked a private survey
report showing that India's manufacturing sector expanded at the slowest pace
in four months in February amid rising borrowing costs & weakness in the
sector. However, the sector remained relatively strong amid buoyant domestic
demand, despite higher inflationary pressures. India's S&P Global
Manufacturing Purchasing Managers' Index remained largely unchanged at 55.3 in
February from January's 55.4. It was well above the 50-mark separating
expansion from contraction for a 20th straight month. Finally, the BSE Sensex
rose 448.96 points or 0.76% to 59,411.08 and the CNX Nifty was up by 146.95
points or 0.85% to 17,450.90.
The US markets ended mostly in
red on Wednesday following the release of a report from the Institute for
Supply Management on U.S. manufacturing activity in the month of February.
While the ISM said its manufacturing PMI inched up to 47.7 in February from
47.4 in January, a reading below 50 still indicates a contraction. Street had
expected the index to edge up to 48.0. The report also showed the prices index
jumped to 51.3 in February from 44.5 in January, indicating raw materials
prices increased after decreasing for four consecutive months. The notable
rebound by the prices index may have added to recent concerns about inflation
and the outlook for interest rates. Meanwhile, treasury yields jumped following
the release of the report, with the ten-year yield reaching its highest levels
in over three months. Bond yields extended their February gains, with the
benchmark 10-year yield briefly topping 4% for the first time since November.
The 1-year Treasury yield rose above 5%. On the sectoral front, interest
rate-sensitive utilities stocks showed a significant move to the downside,
dragging the Dow Jones Utility Average down by 1.8 percent to its lowest
closing level in over three months. Considerable weakness was also visible
among retail stocks, as reflected by the 1.8 percent slump by the Dow Jones
U.S. Retail Index. Telecom and commercial real estate stocks also saw notable
weakness on the day, while steel, energy and gold stocks moved sharply higher.
Crude oil futures ended higher on
Wednesday on growing hopes for higher demand after a jump in manufacturing in
top crude importer China. Crude oil prices rose despite data showing a jump in
crude inventories in the week ended February 24th. Data released by Energy
Information Administration (EIA) showed crude stockpiles rose by 1.165 million
barrels in the week ended February 24, rising for a 10th straight week. The
increase was nearly 4 times over the level seen a week earlier. Gasoline
inventory dropped by 0.874 million barrels last week, as against an expected
increase of 0.464 million barrels, while distillate stockpiles rose by 0.179
million barrels versus the expected drop of 0.462 million barrels. Benchmark
crude oil futures for April delivery surged $0.64 or 0.8 percent to 77.69 a
barrel on the New York Mercantile Exchange. Brent crude for May delivery rose
$0.86 or 1 percent to $84.31 a barrel on London's Intercontinental Exchange.
Indian Rupee ended higher against
the US dollar on Wednesday as a positive trend in domestic equities and easing
crude oil prices supported investor sentiments. Sentiments remained upbeat
after Moody's Investors Service has raised India's Gross Domestic Product (GDP)
growth estimate for 2023 to 5.5 per cent from 4.8 per cent pegged earlier, on
the back of a sharp increase in capital expenditure in the Budget and a
resilient economic momentum. Besides, output of eight core industries increased
at a four-month high of 7.8 per cent in January 2023 as against 4 per cent in
the same month of previous year, led by a sharp uptick in fertiliser production
and double-digit growth in coal mining and electricity generation. On the
global front, dollar eased and China's yuan gained on Wednesday after China's
manufacturing activity expanded at its fastest pace since April 2012, while the
euro rose after regional German price data added to inflation worries. Finally,
the rupee ended at 82.50 (Provisional), stronger by 8 paise from its previous
close of 82.58 on Tuesday.
The FIIs as per Wednesday's data
were net sellers in both equity and debt segments. In equity segment, the gross
buying was of Rs 18425.55crore against gross selling of Rs 23068.15 crore,
while in the debt segment, the gross purchase was of Rs 196.03 crore against
gross selling of Rs 214.97 crore. Besides, in the hybrid segment, the gross
buying was of Rs 16.43 crore against gross selling of Rs 51.95 crore.
The US markets ended mostly in
red on Wednesday as Treasury yields jumped after manufacturing data indicated
inflation is likely to remain stubbornly high. Asian markets are trading mixed
on Thursday tracking lackluster trade overnight on Wall Street. Indian markets
snapped an eight-day losing streak and ended higher on Wednesday amid buying
across sectors. Today, start of session is likely to be pessimistic on weekly
F&O expiry amid weak global cues. Continued foreign fund outflows likely to
dent sentiments in the markets. Foreign institutional investors (FII) sold
shares worth Rs 424.88 crore on March 1, the National Stock Exchange's
provisional data showed. There will be some cautiousness with report that the
government collected Rs 1.50 lakh crore as Goods and Services Tax (GST) in
February, the finance ministry said on March 1. The GST collections for
February fell from Rs 1.58 lakh crore in January. Traders may take note of
Chief Economic Advisor V Anantha Nageswaran's statement that the performance of
the manufacturing sector and growth rate in private consumption expenditure in
the December quarter of 2022-23 is appearing depressed because of higher base.
There will be some buzz in auto stocks with private report that the domestic
passenger vehicle (PV) industry remained on a steady growth path in February,
recording a 10.6 per cent year-on-year (YoY) rise in sales. The wholesale
figure of 335,269 units was the best ever for the month of February; it was
303,213 units a year ago. Coal industry stocks will be in focus with report
that India's coal production increased by 15.10 per cent to 784.41 million
tonnes during April 2022-February 2023 as compared to 681.5 million tonnes
produced during the same period of last year. There will be some reaction in gas
sector stocks as the latest rise in prices by Rs 50 has taken the prices of
domestic cooking gas to their highest levels since February 2014. Banking
stocks will be in limelight as India Ratings said the gross non-performing
assets (NPA) ratio of banks is expected to improve to 3.3 percent in next
financial year from 4.2 percent in FY23. A loan turns to NPA if there are no
repayments of interest or principal for a period of 90 days.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,450.90
|
17,374.85
|
17,497.35
|
BSE
Sensex
|
59,411.08
|
59,188.59
|
59,554.50
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Steel
|
761.75
|
105.70
|
104.44
|
107.04
|
Adani Enterprises
|
201.14
|
1579.00
|
1466.66
|
1635.66
|
Adani Ports And Special Economic Zone
|
186.61
|
601.70
|
592.20
|
613.60
|
State Bank of India
|
135.10
|
536.25
|
527.10
|
541.40
|
Axis Bank
|
123.45
|
864.40
|
850.05
|
873.75
|
Adani Enterprises' wholly owned subsidiary -- Mundra Aluminium has been declared as the preferred bidder for the Kutrumali bauxite block by the Odisha government.
Tech Mahindra has expanded partnership with Microsoft as an Azure Operator Nexus Ready Systems Integrator.
Reliance Industries has incorporated a wholly owned subsidiary namely Reliance SOU.
HCL Technologies has entered into a new collaboration with Dell Technologies to accelerate telecom network modernization for communication service providers and enterprises.