Indian equity benchmarks traded
lackluster for yet another session on Wednesday due to losses in Utilities,
Realty and Consumer Durables stocks amid weak global cues. After making
cautious start, key gauges trade marginally in green as traders took some
support with Fitch Ratings' report in which it has retained India's economic
growth forecast at 7 per cent for the current fiscal, saying India could be one
of the fastest-growing emerging markets this year. Some support also came as
the World Bank in its India Development Update said the central government is
on track to meet its fiscal deficit target of 6.4 per cent of the GDP for 2022-23
on the back of strong growth in revenue collections. High nominal GDP growth in
the first quarter supported strong growth in revenue collection, especially
Goods and Services Tax (GST), despite tax cuts on fuel. However, markets failed
to hold gains and slipped into red terrain in late morning deals, as investors
booked profits post the rate hike by the RBI governor. The Reserve Bank of
India (RBI) has increased the policy repo rate under the liquidity adjustment
facility (LAF) by 35 basis points to 6.25 per cent with immediate. Meanwhile,
it also announced a mild reduction in the GDP growth forecast for the current
financial year to 6.8 per cent from 7 per cent earlier. It said that while the
growth forecast had been reduced, India would still be among the
fastest-growing major economies. Some concern also came as Niti Aayog has
raised objections to certain provisions pertaining to the proposed DESH bill,
which seeks to replace the existing law for special economic zones. In the
Union Budget 2022-23, the government had proposed to replace the existing law
governing Special Economic Zones (SEZs) with a new legislation to enable states
to become partners in Development of Enterprise and Service Hubs (DESH).
Finally, the BSE Sensex fell 215.68 points or 0.34% to 62,410.68 and the CNX
Nifty was down by 82.25 points or 0.44% to 18,560.50.
The US markets ended mostly lower
on Wednesday as traders expressed uncertainty about the near-term outlook for
the markets ahead of next week's Federal Reserve meeting. The Fed still seems
poised to slow the pace of interest rate hikes, but recent upbeat economic data
has raised concerns about how much further the central bank will raise rates at
future meetings. The recent selling on markets partly reflects worries the Fed
will be need to push the economy into a prolonged recession in order to bring
inflation down close to its 2 percent target. On the sectoral front, reflecting
the lackluster performance by the broader markets, most of the major sectors
ended the day showing only modest moves in afternoon trading. Airline stocks
showed a substantial move to the downside, however, dragging the NYSE Arca
Airline Index down by 3.1 percent to its lowest closing level in a month. Considerable
weakness also emerged among oil service stocks, as reflected by the 2.3 percent
slump by the Philadelphia Oil Service Index. Steel, networking and brokerage
stocks also moved to the downside, although selling pressure was somewhat
subdued. On the economic data front, revised data released by the Labor
Department on Wednesday showed U.S. labor productivity increased by much more
than initially estimated in the third quarter. The Labor Department said labor
productivity climbed by 0.8 percent in the third quarter compared to the
previously reported 0.3 percent uptick. Street had expected productivity growth
to be upwardly revised to 0.5 percent. The upward revision to labor
productivity, a measure of output per hour, came as the spike in output was
upwardly revised to 3.3 percent from 2.8 percent, while the jump in hours
worked was upwardly revised to 2.5 percent from 2.4 percent.
Crude oil futures ended lower on
Wednesday, magnifying recent losses, as Energy Information Administration (EIA)
in its data showed a sharp increase in gasoline inventories in the week ended
December 2nd. Gasoline inventories rose by 5.320 million barrels in the week,
beating expectations for a build of 2.707 million barrels. Recession worries
also hurt markets after top U.S. banks warned of a recession in 2023 and China
reported weak trade balance figures for November. However, Data from Energy
Information Administration showed crude inventories fell by 5.187 million
barrels last week versus an expected decline of about 3.305 million barrels. Benchmark
crude oil futures for January delivery fell $2.24 or 3 percent at $72.01 a
barrel on the New York Mercantile Exchange. Brent crude for February delivery
dropped $2.18 or 2.8 percent to settle at $77.11 a barrel on London's
Intercontinental Exchange.
Indian rupee strengthened against
the dollar on Wednesday after Reserve Bank of India (RBI) has increased the
policy repo rate under the liquidity adjustment facility (LAF) by 35 basis points
to 6.25 per cent with immediate effect. Consequently, the standing deposit
facility (SDF) rate stands adjusted to 6.00 per cent and the marginal standing
facility (MSF) rate and the Bank Rate to 6.50 per cent. Besides, RBI Governor
said it decided to add a new feature in its Unified Payments Interface (UPI)
platform where the delivery of service or goods happens later such as
e-commerce purchases, hotel bookings or investments in equities. On the global
front, dollar was little changed on Wednesday after some of the biggest U.S.
banks warned of an impending recession, while China's yuan firmed as
authorities loosened some of the country's zero-COVID rules. Finally, the rupee
ended at 82.47 (Provisional), stronger by 3 paise from its previous close of 82.50
on Tuesday.
The FIIs as per Wednesday's data
were net sellers in equity segment, while net buyers in debt segment. In equity
segment, the gross buying was of Rs 7088.27 crore against gross selling of Rs
7345.28 crore, while in the debt segment, the gross purchase was of Rs 889.79
crore against gross selling of Rs 444.37 crore. Besides, in the hybrid segment,
the gross buying was of Rs 3.55 crore against gross selling of Rs 5.85 crore.
The US markets ended mostly in
red on Wednesday as investors struggled to grasp a clear direction as they
weighed how the Federal Reserve's monetary policy tightening might feed through
into corporate America. Asian markets are trading mostly lower on Thursday with
recession fears weighing on continued negative sentiment. Indian markets ended
modestly lower on Wednesday as the Reserve Bank of India (RBI) raised its
benchmark interest rates for the fifth consecutive meeting. Today, domestic
indices are likely to get cautious start amid lackluster cues from global
markets. The Gujarat and Himachal Pradesh assembly election results will be the
key triggers for the equity markets today. Traders will be concerned with a
private report stating that India's GDP growth may slow down sharply to 5.1
percent in 2023-24 and force the Reserve Bank of India (RBI) to cut the key
repo rate by 75 basis points (bps) in the second half of 2023. Besides, foreign
fund outflow likely to dent sentiments. Foreign institutional investors (FIIs)
net sold shares worth Rs 1,241.87 crore on December 7, as per provisional data
available on the NSE. However, traders may be taking encouragement with a
private report that robust GST collections will help achieve the FY23 revenue
growth target on the indirect taxes front, despite the impact of duty cuts on
central excise and customs mop-up. Some support may come as the government
extended export benefits under the tax refund scheme -- RoDTEP -- to chemicals,
pharmaceuticals and products of iron and steel for a specified period with a
view to boost shipments of these goods, amidst exports growth recording a
contraction of 16.65 per cent in October. Traders may take note of report that
the government is working on ways to contain surge in imports of non-essential
goods with an aim to boost the country's exports and reduce trade deficit.
Power stocks will be in focus as Union minister R K Singh said the single-day
peak demand for power is expected to increase by up to 35,000 MW in April 2023
and the government has started preparations to meet the same. Separately, India
plans to build more nuclear power plants to increase the production of clean
energy. Meanwhile, Dharmaj Crop Guard shares are likely to get listed on BSE
and NSE today. Dharmaj Crop Guard IPO had received a good response from
investors, and the company is likely to see a strong debut on stock exchanges.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
18,560.50
|
18,503.16
|
18,643.06
|
BSE
Sensex
|
62,410.68
|
62,231.57
|
62,674.89
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Steel
|
394.94
|
111.20
|
110.20
|
112.85
|
ICICI Bank
|
156.75
|
923.00
|
918.04
|
930.59
|
Tata Motors
|
121.33
|
419.90
|
416.66
|
425.56
|
ITC
|
98.13
|
340.00
|
337.26
|
342.11
|
Oil & Natural Gas Corporation
|
97.31
|
140.50
|
139.81
|
141.46
|
ITC has acquired 1,967 Compulsorily Convertible Preference Shares of Rs 10 each of Delectable Technologies (Delectable) in the fourth tranche on December 06, 2022.
Bajaj Finserv's unlisted insurance subsidiary -- Bajaj Allianz General Insurance Company has reported Gross Direct Premium underwritten of Rs 1,338.10 crore in the month of November 2022.
Larsen & Toubro's construction arm -- L&T construction has secured various orders for its Minerals & Metals Business in the Iron & Steel and Beneficiation sectors from ArcelorMittal Nippon Steel India.
HCL Technologies has collaborated with Intel Corporation and Mavenir to develop and provide scalable private 5G network solutions for CSP and broader cross-vertical enterprise.