Indian equity
benchmarks sustained the joy of closing in the positive territory for the third
successive session on Wednesday, where frontline gauges garner gains of over
two percent each, recapturing their crucial 51,400 (Sensex) and 15,200 (Nifty).
The markets rally was driven by firm global cues as well as gains in index
heavyweights such as Bajaj Finserv, Reliance Industries, Bajaj Finance and
ICICI Bank. Key gauges made positive start and stayed in green throughout the
session, amid assurances from the government that it had enough COVID-19
vaccine doses to cover its population. The government said there were plenty of
COVID-19 vaccines for the country even though it has sent quantities abroad.
Sentiments also got boost with Principal economic advisor to the finance
ministry Sanjeev Sanyal's statement that Indian economy is recovering much
faster than expected and the government will spend on building infrastructure
rather than boosting consumer demand artificially. He also said the country
needs to keep the growth momentum and it is the only means to create employment
and reduce poverty. Key indices extended their upward momentum in the late
afternoon session, as the growth of India's service sector expanded at the
fastest rate in the month of February, owing to a quicker increase in new
orders. Moreover, the roll-out of coronavirus disease 2019 (COVID-19) vaccines
led to an improvement in business confidence towards growth prospects. As per the
survey report, the seasonally adjusted Nikkei Services Business Activity Index
surged to 55.3 in February from 52.8 in January. Further, the Nikkei India
Composite PMI Output Index -- which measures both manufacturing and services -
also jumped to 57.3 in February from 55.8 in January. Sentiments were lifted by
Former Niti Aayog Vice Chairman Arvind Panagariya's statement that India's
economy is on an upswing and the government's plans for increased spending
comes in the backdrop of pro-growth reforms. However, he said that it might
take longer to become a $5 trillion economy due to the coronavirus
pandemic-induced disruptions. Additional support also came as RBI governor
Shaktikanta Das expressed optimism about the overall COVID-19 situation
following the rollout of the vaccines and complimented all the SAARC central
banks for their efforts in combating the pandemic. Traders paid no heed to
India's exports marginally declined 0.25 per cent to $27.67 billion in February
while imports grew by 6.98 per cent to $40.55 billion during the month. The
exports during April-February 2020-21 period stood at $255.92 billion. In the
same period a year ago, it was at $291.87 billion, showing a negative growth of
12.32 per cent. Finally, the BSE Sensex rose 1147.76 points or 2.28% to
51,444.65, while the CNX Nifty was up by 326.50 points or 2.19% to 15,245.60.
The US markets
settled lower on Wednesday, extending the pullback seen in the previous
session, as bond yields showed a notable rebound after trending lower over the
past few sessions. Yields remain well off the highs set last week, but renewed
concerns about the outlook for interest rates and inflation weighed on
highly-flying tech stocks. The rebound by yields came amid optimism about the
coronavirus vaccine rollouts, which had also contributed to an advance by
stocks futures before the bond markets opened. President Joe Biden announced
the US will have enough vaccine supply for every adult in America by the end of
May. Biden cited the emergency use authorization issued for Johnson &
Johnson's vaccine as well as a collaboration between J&J and Merck to
expand production of the single-dose vaccine. On the economic data front,
payroll processor ADP released a report showing much weaker than expected
private sector job growth in the month of February. ADP said private sector
employment rose by 117,000 jobs in February after climbing by an upwardly
revised 195,000 jobs in January. Street had expected employment to increase by
177,000 jobs compared to the addition of 174,000 jobs originally reported for
the previous month. The Institute for Supply Management (ISM) released a report
showing a slowdown in the pace of growth in US service sector activity in the
month of February The ISM said its services PMI dropped to 55.3 in February
from 58.7 in January, although a reading above 50 still indicates growth in the
sector. Street had expected the index to come in unchanged.
Crude oil futures ended higher on
Wednesday amid speculation the Organization of the Petroleum Exporting
Countries and allies might decide to extend production curbs for the near
future. The members of the organization and allies, collectively named OPEC+,
are scheduled to meet on Thursday. It is now widely expected that the group may
decide to maintain output curbs for a longer duration. However, data released
by Energy Information Administration (EIA) showed US crude inventories
increased by 21.6 million barrels in the week ended February 27, as against an
expected a drop of approximately 930,000 barrels. The American Petroleum
Institute (API) reported on Tuesday that US crude stocks rose by 7.4 million
barrels for the week ended Feb. 26, in stark contrast to street estimate for a
draw of 928,000 barrels. Crude oil futures for April rose $1.53 or 2.62 percent
to settle at $61.28 barrel on the New York Mercantile Exchange. May Brent crude
surged $1.75 cents or 2.8 percent to settle at $64.45 a barrel on London's
Intercontinental Exchange.
Indian rupee continued its upward
momentum for the second day and ended fairly higher against US dollar on
Wednesday, on the back of selling of the American currency by exporters.
Sentiments were upbeat as India's services activity expanded at the fastest
rate in a year during February, while employment fell further and companies
noted the sharpest rise in overall expenses. Additional support came with
Former Niti Aayog Vice Chairman Arvind Panagariya's statement that India's
economy is on an upswing and the government's plans for increased spending
comes in the backdrop of pro-growth reforms. Firm trade in Indian equity
markets also added to rupees strength. On the global front, sterling steadied
against the dollar on Wednesday and gained against the euro ahead of the
announcement of Britain's budget for the coming fiscal year, which is expected
to prop up the economy as it prepares for a reopening from lockdowns. Finally,
the rupee ended at 72.72, 65 paise stronger from its previous close of 73.37 on
Tuesday.
The FIIs as per Wednesday's data
were net buyer in equity segment, while net seller in debt segment. In equity
segment, the gross buying was of Rs 9395.34 crore against gross selling of Rs 6745.99
crore, while in the debt segment, the gross purchase was of Rs 382.78 crore
with gross sales of Rs 2052.99 crore. Besides, in the hybrid segment, the gross
buying was of Rs 4.79 crore against gross selling of Rs 16.96 crore.
The US markets ended lower on
Wednesday as investors sold off technology stocks, while the dollar rose even
as US jobs data disappointed investors. Asian markets are trading mostly in red
on Thursday taking cues from overnight declines on Wall Street as bond yields
rose yet again. Indian markets ended higher for the third straight session on
Wednesday, with frontline indices rising 2-3 percent, backed by growing
economic optimism and vaccination drive picking up pace. Today, markets are
likely to make gap-down opening amid feeble global cues. Besides, the weekly
options expiry may keep the session volatile. Traders will be concerned as
India's tally of coronavirus cases has risen to 11,156,748, with a daily
increase of 15,000 in total cases. Death toll has reached 157,471, with 110
fatalities in a day. India's count of active cases has jumped to 175,044. The
country continues to be second-most-affected globally, and ranks 13th among
worst-hit nations by active cases. The five most affected states by total cases
are Maharashtra (2,169,330), Kerala (1,064,279), Karnataka (952,037), Andhra
Pradesh (890,080), and Tamil Nadu (852,478). Maharashtra is now contributing more
than half of fresh coronavirus infections in India, fanning fears of a second
wave in the state. Traders may take note of report that Commerce and Industry
Minister Piyush Goyal has said the need of the hour is to reduce logistics cost
in the country as India cannot be competitive if this cost remains high.
Meanwhile, Securities and Exchange Board of India (SEBI) has asked stock
exchanges, clearing corporations and depositories to put in place code of
conduct and institutional mechanism to prevent fraud or market abuse by them
and their designated persons. Under this, managing director (MD) / chief
executive officer (CEO) of MIIs will be obligated to frame code of conduct and
put in place an institutional mechanism. There will be some buzz in insurance industry
stocks as the finance ministry said that the government has amended insurance
ombudsman rules, bringing insurance brokers within their ambit and also allowed
policyholders to file online complaints. The amended rules have enlarged the
scope of complaints to ombudsmen from only disputes earlier to deficiencies in
service on the part of insurers, agents, brokers and other intermediaries.
Construction equipment sector stocks will be in focus as ICRA revised the
outlook on the construction equipment (CE) sector to stable from negative,
following strong ramp up in volumes. Heightened focus on infrastructure spend,
particularly in the road infrastructure segment has led to a sharp scale up in
volumes since July 2020 (20%+ Y-o-Y growth during July-Jan'21 period). There
will be some reaction in sugar industry stocks as ISMA said that India's sugar
production rose by 20 per cent to 233.77 lakh tonnes in the first five months
of 2020-21 marketing year ending September on higher cane production, and
demanded hike in MSP of the sweetener to boost mills' liquidity position.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
15,245.60
|
15,069.89
|
15,347.24
|
BSE
Sensex
|
51,444.65
|
50,791.69
|
51,818.74
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata
Motors
|
920.06
|
348.50
|
344.34
|
354.84
|
State
Bank of India
|
462.68
|
405.05
|
397.74
|
410.64
|
NTPC
|
317.02
|
112.70
|
111.56
|
114.26
|
Indian
Oil Corporation
|
300.23
|
102.60
|
101.34
|
103.94
|
Tata
Steel
|
288.42
|
777.15
|
751.26
|
792.76
|
Reliance Industries' telecom arm -- Jio has acquired the right to use spectrum in all 22 circles across India in the recently concluded spectrum auctions.
TCS has launched the TCS Mittelstand Enterprise Suite, a ready-to-deploy, modular set of services and solutions, designed specifically for German medium-sized and family-owned companies in the manufacturing industry.
Tata Motors' wholly owned subsidiary -- JLR has set up charging infrastructure across 22 retail outlets in the country as it prepares to launch its all-electric SUV, Jaguar I-PACE, later this month.
Maruti Suzuki India has declared that its service network has crossed 4,000 outlet mark across the country, covering 1,989 towns and cities.