Indian equity
benchmarks closed in the red for the second consecutive day on Thursday dragged
down by banking and finance counters.
Key gauges opened positive but soon went in negative territory amid
continuous foreign fund outflows. Foreign Institutional Investors (FIIs)
offloaded shares worth a net Rs 2,620.89 crore on January 4, 2023, according to
exchange data. Some concerns came with rating agency ICRA's report stating that
the evolving global macroeconomic headwinds could moderate growth for Indian IT
services industry over the medium term. It has cited that given the Indian IT
services industry generates about 60-65 per cent of revenues from the US market
and 20-25 per cent from the European market, it remains susceptible to
macroeconomic uncertainties and adverse regulatory changes in these key
operating markets. However, in the last hour of the trade, renewed buying
across Oil & Gas, FMCG and Energy stocks helped the benchmarks to pare
around half of the intraday losses. Traders took some support with a report
that private sector banks are expected to report healthy growth in earnings
during the October-December quarter of FY23. This would be aided by robust
credit growth, margin expansion, benign credit costs, and lower provisioning
burden. However, operational costs may remain high due to investment in
businesses. Traders took a note of Bibek Debroy's statement, chairman of
Economic Advisory Council to the Prime Minister, that India's GDP will be close
to $20 trillion by 2047 and per capita income may reach $10,000 (at current
value of USD). Finally, the BSE Sensex fell 304.18 points or 0.50% to 60,353.27
and the CNX Nifty was down by 50.80 points or 0.28% to 17,992.15.
The US markets ended lower on
Thursday, with Nasdaq settling cut of over one and half percent, as strong
labor data and hawkish Fed commentary signaled more aggressive Federal Reserve
interest-rate hikes to come. Payroll processor ADP showed private sector
employment in the U.S. jumped by much more than expected in the month of
December. ADP said private sector employment shot up by 235,000 jobs in
December after surging by an upwardly revised 182,000 jobs in November. Street
had expected employment to jump by about 150,000 jobs compared to the addition
of 127,000 jobs originally reported for the previous month. Traders worry
continued labor market tightness could encourage the Federal Reserve to
continue aggressively raising interest rates in the coming months. On Friday,
the Labor Department is scheduled to release its more closely watched
employment report for the month of December. On the sectoral front, Software
stocks turned in some of the worst performances on the day, with the Dow Jones
U.S. Software Index tumbling by 3.2 percent to a nearly two-month closing low.
Interest rate-sensitive commercial real estate and utilities stocks also saw
considerable weakness, dragging the Dow Jones U.S. Real Estate Index and the
Dow Jones Utility Average down by 2.7 percent and 2.1 percent, respectively.
Chemical stocks also showed a significant move to the downside, resulting in a
2.2 percent slump by the S&P Chemical Sector Index. Semiconductor,
transportation and banking stocks also saw notable weakness, while energy,
steel and airline stocks bucked the downtrend.
Crude oil futures ended higher on
Thursday after data showed gasoline and distillate stockpiles dropped in the
week ended December 30th. The Energy Information Administration (EIA) data
showed gasoline stocks in the U.S. dropped by 346,000 barrels last week,
compared with an expected drop of 486,000 barrels. Meanwhile, distillate
stockpiles fell 1.4 million barrels in the week versus expectations for a drop
of 396,000 barrels. However, EIA data showed Crude inventories in the U.S. rose
by 1.7 million barrels last week versus an expected increase of 1.2 million
barrels. Benchmark crude oil futures for February delivery rose $0.83 or 1.1
percent at $73.67 a barrel on the New York Mercantile Exchange. Brent crude for
March delivery gained $0.94 or 1.2 percent at $78.78 a barrel (provisional) on
London's Intercontinental Exchange.
Rupee settled higher against
dollar on Thursday, supported by a weaker greenback overseas and decline in
crude oil prices. Traders overlooked rating agency ICRA's report stating that
the evolving global macroeconomic headwinds could moderate growth for Indian IT
services industry over the medium term. It has cited that given the Indian IT
services industry generates about 60-65 per cent of revenues from the US market
and 20-25 per cent from the European market, it remains susceptible to
macroeconomic uncertainties and adverse regulatory changes in these key
operating markets. On the global front, dollar was roughly flat in choppy trade
on Thursday after the release of the latest Federal Reserve minutes. Details of
the discussion from the central bank's December policy meeting, released on
Wednesday, showed policymakers remain focused on curbing inflation and do not
envisage interest rate cuts in 2023. Finally, the rupee ended at 82.50
(Provisional), stronger by 32 paise from its previous close of 82.82 on
Wednesday.
The FIIs as per Thursday's data
were net sellers in both equity and debt segment. In equity segment, the gross
buying was of Rs 4512.26 crore against gross selling of Rs 6973.37 crore, while
in the debt segment, the gross purchase was of Rs 135.96 crore against gross
selling of Rs 569.41 crore. Besides, in the hybrid segment, the gross buying
was of Rs 0.59 crore against gross selling of Rs 9.18 crore.
The US markets ended lower on
Thursday as evidence of a tight labor market eroded hopes that the Federal
Reserve could pause its rating hiking cycle anytime soon as it keeps focused on
inflation. Asian markets are trading mixed on Friday as a better-than-expected
reading of ADP private payrolls report showed that employers added 235,000 jobs
in December, showing a strong labor market. Indian benchmarks buckled under
selling pressure for the second straight session on Thursday as traders reduced
their exposure to riskier assets after minutes from the US Federal Reserve's
latest meeting indicated more rate hikes this year. Today, the markets are
likely to get cautious start amid mixed global cues. Investors may remained on
sidelines and avoid taking long positions ahead of kick start of earning season
in coming week. Persistent selling by foreign investors likely to dent
sentiments in local markets. Foreign institutional investors (FII) sold shares
worth Rs 1,449.45 crore on January 5, as per provisional data available on the
NSE. Traders will be concerned with a private report that India's economy is
expected to grow 5.5% in the next financial year, a notch below the expected
potential rate of 6%, as growth momentum in the country was slowing gradually.
However, some respite may come later in the day as the commerce and industry
ministry is hopeful of improvement in foreign direct investment (FDI) inflows
in the coming months despite global headwinds. Some support may come as Union
New and Renewable Energy Minister R K Singh said his ministry will come out
with detailed guidelines and standards for making India a global hub for
hydrogen manufacturing. Traders may take note of report that Israel's
newly-appointed Foreign Minister Eli Cohen and his Indian counterpart S
Jaishankar have discussed about ways to strengthen bilateral ties, including
ways to promote Free Trade Agreement (FTA) and projects in the field of
innovation, food and water security. Meanwhile, the Securities and Exchange
Board of India (Sebi) has extended the relaxation to listed companies from
dispatching of physical copies of financial statements till September 30, 2023.
Coal industry stocks will be in focus as the dispatch of coal to different
sectors was at 78.91 million tonnes (MT) in December, registering a rise of
5.28 per cent. The coal dispatch in the corresponding month of previous fiscal
was 74.95 MT.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,992.15
|
17,883.06
|
18,110.76
|
BSE
Sensex
|
60,353.27
|
59,976.38
|
60,803.60
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Steel
|
588.06
|
116.80
|
115.20
|
117.70
|
NTPC
|
188.87
|
169.60
|
167.71
|
170.91
|
ICICI Bank
|
165.47
|
878.70
|
866.14
|
897.14
|
Oil & Natural Gas Corporation
|
163.20
|
146.45
|
144.74
|
147.59
|
Power Grid Corporation of India
|
159.55
|
209.00
|
206.44
|
211.74
|
Coal India and the four central trade unions -- BMS, HMS, AITUC and CITU have signed a MoU recommending 19% MGB to its 2.38 lakh non-executive employees as part of the ongoing National Coal Wage Agreement.
Bajaj Finance's deposits book stood at around Rs 43,000 crore (provisional) as of December 31, 2022 as compared to Rs 30,481 crore as of December 31, 2021, a YoY growth of 41%.
Reliance Industries' telecom arm -- Reliance Jio Infocomm has collaborated with Motorola to enable True 5G across its extensive 5G smartphone portfolio in India.
IndusInd Bank, British Airways Executive Club and Qatar Airways Privilege Club have entered into a partnership to introduce the unique multi-branded credit card, with two leading international airlines, powered by Visa.