Indian equity benchmarks made a
second straight day of gains on Friday, shrugging off weak global cues.
Headline indices opened higher and traded in green for most part of the day as
provisional data from the NSE showed foreign institutional investors (FIIs)
bought shares worth Rs 1,513.41 crore on January 4. Sentiments remained
positive with the United Nations (UN) World Economic Situation and Prospects
(WESP) 2024 report stating that India's Gross domestic product (GDP) growth is
projected to remain strong at 6.2 per cent in 2024 mainly supported by
resilient private consumption and strong public investment. It also said that
GDP in South Asia is projected to increase by 5.2 per cent in 2024, driven by a
robust expansion in India, which remains the fastest-growing large economy in
the world. Some support came in with a private report that India is likely to
project higher economic growth estimates of around 7% for the 2023/24 fiscal
year ending in March, compared with earlier government forecasts when the
National Statistical Office releases its first advance GDP estimates on Friday.
However, markets gave up early gains to slip in red in late afternoon deals, as
traders turned cautious with a private report that the JN.1 subvariant has
become the dominant Covid-19 variant in India, accounting for more than 60% of
the coronavirus cases in the country. As of Thursday, 511 cases of the
subvariant JN.1 have been reported across the country. India recorded 760 new Covid-19
cases and two deaths, while the active caseload saw a slight dip to 4,423 from
4,440 on the previous day. Some concern also came with Secretary in the
Department for Promotion of Industry and Internal Trade (DPIIT) Rajesh Kumar
Singh stating that India will have to eventually move to a lower customs duty
regime and cannot continue to protect domestic manufacturers by citing infant
industry argument. However, markets soon regained traction to end higher,
taking support from data showing that India's services sector ended 2023 on a
firm footing, with activity expanding at its fastest pace in three months in
December on buoyant demand and an optimistic year-ahead outlook. The HSBC India
Services Purchasing Managers' Index, compiled by S&P Global, rose sharply
in December to 59.0 from November's one-year low of 56.9. Finally, the BSE
Sensex rose 178.58 points or 0.25% to 72,026.15 and the CNX Nifty was up by
52.20 points or 0.24% to 21,710.80.
The US markets ended the volatile
session in green with marginal gains on Friday as traders reacted to the
release of some key U.S. economic data, including a closely watched Labor
Department report showing stronger than expected job growth in December.
Initially, the data raised concerns about the outlook for interest rates,
however positive sentiment prevailed as traders digested the details of the
report, which also showed notable downward revisions to job growth in October
and November. The Labor Department said non-farm payroll employment surged by
216,000 jobs in December compared to street estimates for an increase of about
170,000 jobs. At the same time, the increases in employment in October and
November were downwardly revised to 105,000 jobs and 173,000 jobs,
respectively, reflecting a net downward revision of 71,000 jobs. The Institute
for Supply Management also released a report showing a bigger than expected
slowdown in the pace of U.S. service sector growth. The ISM said its services
PMI fell to 50.6 in December from 52.7 in November. While a reading above 50
still indicates growth, street had expected the index to show a much more
modest decrease to 52.6. The data also contributed to significant volatility in
the bond markets, with the yield on the benchmark ten-year note bouncing back
and forth across the unchanged line before closing above 4.0 percent for the
first time in over four weeks. Meanwhile, traders remained on sidelines ahead
of inflation data which is likely to be release in next week, as the Labor
Department is scheduled to release separate reports on consumer and producer
price inflation.
Crude oil futures recouped
previous session's losses and ended significantly higher on Friday with gains
of over one and half a percent amid ongoing fears of an escalation of the
Israel-Hamas war into a broader regional conflict. Attacks by Yemen's Houthi
rebels against merchant shipping in the Red Sea as well as a U.S. airstrike
that killed top leader of an Iran-backed terrorist group in Iraq added to the
concerns. Benchmark crude oil futures for February delivery surged by $1.62 or
2.2 percent to settle at $73.81 a barrel on the New York Mercantile Exchange.
Brent crude for March delivery rose by $1.17 or 1.51 percent to settle at
$78.76 a barrel on London's Intercontinental Exchange.
Indian rupee ended higher for
third straight day against the US dollar on Friday, on persistent selling of
dollars by banks and exporters. Sentiments remained positive with the United
Nations World Economic Situation and Prospects 2024 report stating that India's
GDP growth is projected to remain strong at 6.2% in 2024 mainly supported by
resilient private consumption and strong public investment. Some support also
came with data showing that India's services sector ended 2023 on a firm
footing, with activity expanding at its fastest pace in three months in
December on buoyant demand and an optimistic year-ahead outlook. The HSBC India
Services Purchasing Managers' Index, compiled by S&P Global, rose sharply
in December to 59.0 from November's one-year low of 56.9. On the global front,
the dollar rose on Friday, heading for its steepest weekly rise since May as
traders scaled back expectations of early U.S. interest rate cuts this year.
Finally, the rupee ended at 83.15 (Provisional), stronger by 9 paise from its
previous close of 83.24 on Thursday.
The FIIs as per Friday's data
were net buyers in both equity and debt segments. In equity segment, the gross
buying was of Rs 14741.29 crore against gross selling of Rs 13352.09 crore,
while in the debt segment, the gross purchase was of Rs 905.32 crore with gross
sales of Rs 175.85 crore. Besides, in the hybrid segment, the gross buying was
of Rs 114.70 crore against gross selling of Rs 101.48 crore.
The US markets ended higher on
Friday as investors digest data hinting that the Federal Reserve can pull off a
soft landing for the world's largest economy. Asian markets are trading mostly
in red on Monday as investors look ahead to key economic data and events in the
following days. Indian markets ended the choppy session in green terrain on
Friday as investors booked profit in pharmaceutical, and metal stocks. Today,
markets are likely to get cautious start amid rising geopolitical crisis. China
announced sanctions on five US defence-related companies in response to
sanctions on Chinese companies and arm sales to Taiwan. Elsewhere, North Korea
has been firing artillery shells near South Korean sea boundary for the last
three days, following a provocative statement from Kim Yo Jong, the sister and
key ally of North Korea's supreme leader Kim Jong Un. Domestically, traders
will be concerned as a report by economic think tank GTRI said the increasing
Red Sea crisis may impact trade as it is expected to push shipping costs by up
to 60% and insurance premium by 20%. Due to these attacks, the shippers are
taking consignments through the Cape of Good Hope, resulting in delays of about
20 days. Traders may take note of the Finance Ministry's statement that as many
as 29,273 bogus firms involved in alleged input tax credit (ITC) evasion of Rs
44,015 crore have been identified since the special hunt against false
registrations began in mid-May 2023. Meanwhile, the Reserve Bank of India has
tightened rules for the issuance of short term Commercial Papers and NCDs, with
an initial maturity of up to one year. The new norms, which come into effect
from April 1, involve six key changes. However, some respite may come later in
the day as the first advance estimates of national income released by the
National Statistical Office projected the Indian economy to grow at 7.3% in
2023-2024 - higher than the Reserve Bank of India's estimate of 7% - assuming
an investment-led recovery in the world's fifth largest economy. This beats the
Street estimates by a wide margin. The Indian economy grew 7.7% in the first
half (April-September) of FY24. Some support may come as the Reserve Bank said
India's forex reserves jumped by $2.759 billion to $623.2 billion in the week
ended December 29. In the previous reporting week, the overall reserves had
increased by $4.471 billion to $620.441 billion. There will be some reaction
stocks related to agriculture sector as the first advance estimates of national
income released by the National Statistical Office (NSO) showed that the
agriculture sector is projected to see a growth of 1.8% in the FY24, a
seven-year low, due to poor Kharif harvest and weak initial sowing of Rabi
crops. Insurance industry stocks will be in limelight as the monthly premiums
of non-life insurance companies grew by 14.74% in December 2023 to Rs 25,098.18
crore from Rs 21,874.61 crore in the year-ago month. According to the General
Insurance Council (GIC)'s monthly data, public-sector general insurance
companies grew 13.10%.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
21,710.80
|
21,643.46
|
21,763.86
|
BSE
Sensex
|
72,026.15
|
71,818.50
|
72,195.15
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata
Steel
|
713.30
|
133.70
|
132.39
|
135.49
|
NTPC
|
274.56
|
315.30
|
310.11
|
323.06
|
ONGC
|
207.44
|
215.65
|
213.30
|
217.75
|
Power
Grid
|
163.45
|
240.80
|
238.40
|
244.10
|
State
Bank of India
|
159.85
|
641.45
|
635.55
|
649.55
|
- Power Grid Corporation of India
has been declared as successful bidder under TBCB to establish Inter-State
Transmission System for Transmission Scheme for Solar Energy Zone in Bidar
(2500 MW), Karnataka on BOOT basis.
- State Bank of India has raised
$250 million through issuance of the Green Notes to fund sustainable projects.
- GAIL (India) has signed a Long
Term Liquefied Natural Gas deal with Vitol Asia Pte in India for a supply of
around one million metric tons of LNG per annum for a period of about 10 years,
commencing 2026.
- Tata Motors' subsidiary -- Tata
Passenger Electric Mobility has introduced its first advanced Pure EV
architecture - acti.ev.