Indian equity
benchmarks made a strong comeback on Monday after three days of losses, due to
strong momentum in global markets, favourable domestic economic data and good
Q2 results announcement. After opening in the green, benchmark indices
continued to gain momentum. Traders took encouragement as the Reserve Bank of
India (RBI) said that retail -- covering housing and vehicles, credit cards,
etc -- showed an accelerated growth rate of 12.1 per cent in September 2021
against 8.4 per cent in September 2020. Sentiments remained positive with a
private survey stating that manufacturing activity in India gained steam in
October as companies scaled up production in line with a substantial upturn in
new work intakes. Similarly, factory output increased at a sharp pace that was
the strongest since March. At 55.9 in October, vs 53.7 in September, the
seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index
was in expansion territory for the fourth month in a row in October, pointing
to the strongest improvement in overall operating conditions since February.
Traders remained energized after the finance ministry stating that Goods and
Services Tax (GST) collection remained above Rs 1 lakh crore for the fourth
month in a row at over Rs 1.30 lakh crore in October, indicating the impact of
festive buying. This is the second highest collection of GST since its
implementation on July 1, 2017. The tax collections last month on goods sold
and services rendered was 24 per cent higher than in October 2020. Additional
support also came with data showing that the growth of eight core
infrastructure industries grew by 4.4 percent in September 2021 as compared to
same month last year on account of healthy performance by segments like natural
gas, refinery products and cement. Though, it fell as compared to 11.5 per cent
in the previous month. Meanwhile, government data showed India's federal fiscal
deficit during April-September, the first half of the current fiscal year,
stood at 5.27 trillion rupees ($70.4 billion) or 35% of the budgeted target for
the whole year. Finally, the BSE Sensex rose 831.53 points or 1.40% to
60,138.46 and the CNX Nifty was up by 258.00 points or 1.46% to 17,929.65.
The US markets ended higher on
Monday with Dow Jones Industrial Average and S&P 500 closing at record
highs. A batch of upbeat earnings news has contributed to a recent upward
trend, as most major companies have reported better than expected quarterly
results. Tesla, which became a $1 trillion company last week, continued its
gains for the year with shares up nearly 8.5%. Stocks linked to an economic
recovery, such as Ford and Occidental Petroleum, were also higher. Ford gained
5% and Occidental Petroleum popped 3.8%. However, upside remained capped as
traders looked ahead to the Federal Reserve's monetary policy announcement on Wednesday.
The Fed is likely to leave interest rates unchanged but could announce plans to
begin scaling back its asset purchase program. On the economic data front, a
report released by the Institute for Supply Management (ISM) showed a modest
slowdown in the pace of growth in US manufacturing activity in the month of
October. The ISM said its manufacturing index edged down to 60.8 in October
from 61.1 in September, although a reading above 50 still indicates growth.
Street had expected the index to dip to 60.5. Meanwhile, the Commerce
Department released a report showing construction spending in the US
unexpectedly decreased in the month of September. The report said construction
spending fell by 0.5 percent to an annual rate of $1.574 trillion in September
after inching up by 0.1 percent to a revised rate of $1.582 trillion in August.
The drop in construction spending came as a surprise to participants, who had
expected spending to increase by 0.4 percent.
Crude oil futures ended higher on
Monday as investors expect the Organization of the Petroleum Exporting
Countries and their allies (OPEC+) to remain reluctant to accelerate production
increases despite tightening crude supplies. The Biden administration has
called on OPEC+ to boost output, but producers have remained reluctant. OPEC+
has so far stuck to a plan to boost output in monthly increments of 400,000
barrels a day, but members have struggled to hit that goal. Oil prices climbed
despite report that China has released reserves of gasoline and diesel to boost
supply and help stabilize prices in some regions. Benchmark crude oil futures
for December delivery rose 48 cents or about 0.6% to settle at $84.05 a barrel
on the New York Mercantile Exchange. Brent crude for January delivery surged 99
cents or 1.2 percent to settle at $84.71 a barrel on London's Intercontinental
Exchange.
Indian rupee ended marginally
higher against dollar on Monday, on selling of the American currency by
exporters. Traders remained positive as growth of eight core infrastructure
industries grew by 4.4 percent in September 2021 as compared to same month last
year on account of healthy performance by segments like natural gas, refinery
products and cement. On the global front; dollar consolidated gains against its
rivals on Monday, after posting its biggest daily rise in more than four months
as hedge funds cut back bearish bets ahead of a U.S. Federal Reserve policy
meeting this week. Finally, the rupee ended 74.87, stronger by 1 paise from its
previous close of 74.88 on Friday.
The FIIs as per Monday's data
were net seller in equity segment, while net buyer in debt segment. In equity
segment, the gross buying was of Rs 7028.61 crore against gross selling of Rs
12504.98 crore, while in the debt segment, the gross purchase was of Rs 652.15
crore with gross sales of Rs 441.58 crore. Besides, in the hybrid segment, the
gross buying was of Rs 12.65 crore against gross selling of Rs 14.85 crore.
The US markets ended higher on
Monday as Tesla shares surged and the energy sector gained while investors
looked ahead to a major Federal Reserve meeting later in the week. Asian
markets are trading mostly in green on Tuesday as investors awaited several key
central bank meetings that could set the tone for risk appetite heading into
next year. Indian markets closed in green to snap a three-day losing streak on
Monday as broad-based gains led by financial, IT, metal and consumer goods
shares pushed the headline indices higher. Today, markets are likely to start
on a positive note amid positive global cues. Sentiments will get a boost as
provisional data released by the government showed that India's merchandise
exports in October rose 42.33 per cent to $35.47 billion. The exports stood at
$24.92 billion in October 2020 and $26.23 billion in October 2019. The
merchandise imports surged 62.49 per cent to $55.37 billion from $34.07 billion
in October 2020. It was $37.99 billion in October 2019. As per the data, the
trade deficit in October 2021 was $19.9 billion and $98.71 billion during
April-October 2021. Some support will also come as Goods and Services Tax (GST)
collection remained above Rs 1 lakh crore for the fourth month in a row at over
Rs 1.30 lakh crore in October, indicating the impact of festive buying. This is
the second highest collection of GST since its implementation on July 1, 2017.
Traders may take note of SBI Research report stating that the digitisation
drive and pandemic-induced emergence of the gig economy have led to a faster
formalisation of the economy, with the share of the informal sector shrinking
to just 15-20 per cent in 2021 from 52.4 per cent in 2018. However, there may
be some cautiousness with Centre for Monitoring of Indian Economy (CMIE) data
showing that despite a 124 basis points month-on-month decline in urban
joblessness rate, the country's overall unemployment rate rose again in
October, owing to a sudden 175 basis points rise in rural joblessness rate.
There will be some reaction in edible oils industry stocks as amid no sign of
further moderation in edible oil prices, industry body SEA said its members
have decided to further reduce the wholesale prices of edible oils by Rs 3-5
per kg during this festival season to provide relief to consumers.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,929.65
|
17,766.46
|
18,023.46
|
BSE
Sensex
|
60,138.46
|
59,588.99
|
60,454.08
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata
Motors
|
343.15
|
485.70
|
473.76
|
493.66
|
ITC
|
231.97
|
226.85
|
223.71
|
228.76
|
State
Bank of India
|
206.79
|
515.70
|
505.49
|
521.44
|
Indian
Oil Corporation
|
178.79
|
131.65
|
127.89
|
134.14
|
Bharti
Airtel
|
171.21
|
712.50
|
693.80
|
727.00
|
JSW Steel's subsidiary -- JSW Steel (USA) Inc. has commenced the second phase of the project to upgrade its Plate Mill facility located at Baytown in Texas, USA.
BPCL is planning to raise up to Rs 3,000 crore during the current financial year 2021-22 through private placement of unsecured non-convertible debentures subject to market conditions.
Sun Pharmaceutical Industries has launched Winlevi cream in US market. Winlevi cream used for the treatment of acne vulgaris in patients 12 years and older.
Bharti Airtel has rolled out 5GforBusiness initiative to demonstrate a wide range of enterprise grade use cases using high speed & low latency networks.