Snapping their two-day winning
streak, Indian equity benchmarks ended with deep losses on Monday, as investors
pared exposure to FMCG, Basic Materials and banking stocks amid a weak trend in
global markets. After opening with marginal gains, key indices slipped into
negative territory and traded under pressure throughout the day, as traders
were concerned with a report by economic think tank GTRI stating that the
increasing Red Sea crisis may impact trade as it is expected to push shipping
costs by up to 60 per cent and insurance premium by 20 per cent. Some
cautiousness also came with India Ratings and Research Chief Economist Devendra
Kumar Pant's statement that the Indian economy is facing the challenge of lower
consumption growth as high inflation is impacting people in the lower income
bracket. He said although the country's economy is now resilient enough to deal
with the dual shocks of below-normal monsoon and high global oil prices, the
challenge is to bring down inflation so that people can have more disposable
income in their hands. Markets extended losses in late afternoon deals and
finally settled around the day's lows, as traders preferred to stay on the
sidelines ahead of the earnings season which kick starts on Thursday. Traders
overlooked the first advance estimates of national income released by the
National Statistical Office (NSO) which projected the Indian economy to grow at
7.3 per cent in 2023-2024 - higher than the Reserve Bank of India's estimate of
7 per cent - assuming an investment-led recovery in the world's fifth largest
economy. Traders also paid no heed towards Commerce Secretary Sunil Barthwal's
statement that India's agriculture exports, which stood at over $50 billion at
present, are expected to double by 2030 and reach $100 billion. He said that
the country is targeting $2 trillion worth of exports of goods and services by
2030. Finally, the BSE Sensex fell 670.93 points or 0.93% to 71,355.22 and the
CNX Nifty was down by 197.80 points or 0.91% to 21,513.00.
The US markets ended sharply
higher on Monday with Nasdaq settling over two percent higher. Support came in
as drop in bond yields after a New York Fed survey found U.S. one-year
inflation expectations were at their lowest since January 2021. The Dow also
ended higher, despite a decline in Boeing shares after a piece of a MAX jet
blew off midflight and forced an emergency landing. Shares in supplier Spirit
AeroSystems also slumped. However, Megacaps advanced, lifting stocks such as
Amazon.com which closed up 2.66 per cent and Alphabet, which rose 2.29 per
cent, as Treasury yields fell ahead of readings on inflation and a new supply
of government debt this week, with the benchmark 10-year US Treasury yield
hitting a low of 3.966 per cent on the session. In addition, Apple climbed 2.42
per cent after the iPhone maker said its Vision Pro mixed-reality device will
be available for sale from February 2 in the United States. Nvidia surged 6.3
per cent and fellow chipmaker Advanced Micro Devices (AMD.O) jumped 5.48 per
cent, helping to push the Philadelphia SE Semiconductor Index up 3.28 per cent
as it bounced from a 5.8 per cent drop last week, its biggest weekly percentage
fall since October 2022.
Crude oil futures ended deeply in
red on Monday after Saudi Arabia cut crude prices to all regions and as surveys
showed higher production by members of the Organization of the Petroleum
Exporting Countries. State-owned producer Saudi Aramco on Sunday said it would
cut its official selling price for crude to all regions, including its largest
market in Asia in February. The spread for Saudi crudes, including its flagship
Arab light, over local benchmarks will be cut by up to $2 a barrel. Further,
oil prices also fell as a resurgence in Covid cases in China raised concerns
about energy demand. Benchmark crude oil futures for February delivery fell by
$3.53 or 3.5 percent to settle at $98.54 a barrel on the New York Mercantile
Exchange. Brent crude for March delivery dropped by $2.64 or 3.51 percent to
settle at $76.12 a barrel on London's Intercontinental Exchange.
Indian rupee pared initial gains
and ended almost unchanged against the dollar on Monday as strong American currency
and volatile crude oil prices weighed on the domestic currency. Some
cautiousness also came with India Ratings and Research Chief Economist Devendra
Kumar Pant's statement that the Indian economy is facing the challenge of lower
consumption growth as high inflation is impacting people in the lower income
bracket. He said although the country's economy is now resilient enough to deal
with the dual shocks of below-normal monsoon and high global oil prices, the
challenge is to bring down inflation so that people can have more disposable
income in their hands. On the global front, the dollar held on to most of last
week's gains on Monday after posting its biggest weekly rise against a basket
of other major currencies since July, putting a halt to the declines seen in
late 2023. Finally, the rupee ended at 83.14 (Provisional), stronger by 1 paisa
from its previous close of 83.15 on Friday.
The FIIs as per Monday's data
were net buyers in both equity and debt segments. In equity segment, the gross
buying was of Rs 12638.83 crore against gross selling of Rs 10869.78 crore,
while in the debt segment, the gross purchase was of Rs 1883.42 crore with
gross sales of Rs 218.32 crore. Besides, in the hybrid segment, the gross
buying was of Rs 21.47 crore against gross selling of Rs 29.86 crore.
The US markets ended higher on
Monday as mega-cap tech stocks bounced from last week's declines. Asian markets
are trading mostly in green on Tuesday rebounding from a selloff in the
previous session. Investors assessed December inflation numbers for Japan's
capital city of Tokyo, which are a leading indicator for nationwide inflation.
Indian markets snapped their two-day winning streak on Monday amid a retreat in
the global markets as the 10-year US bond yields once again surpassed the 4 per
cent level. Today, markets are likely to get gap-up opening tracking firm
global cues. Foreign fund inflows likely to aid domestic sentiments.
Provisional data from the NSE showed that foreign institutional investors
(FIIs) bought shares worth Rs 16.03 crore on January 8. Sentiments will get a
boost as Commerce Secretary Sunil Barthwal said India's agriculture exports,
which stood at over $50 billion at present, are expected to double by 2030 and
reach $100 billion. He said that the country is targeting $2 trillion worth of
exports of goods and services by 2030. Some support will also come as US crude
oil declined 4 percent on Monday after Saudi Arabia slashed its prices, raising
renewed worries that the market is oversupplied at the same time as demand is
weakening. Traders may take note of a report that Indian government bonds could
get an additional boost in 2024, with Bloomberg proposing their inclusion in
its indices starting September 2024. Besides, India's mutual fund industry
added a record Rs 10 lakh crore to its assets under management in 2023, taking
the cumulative tally to Rs 50.7 lakh crore in December. However, there may be
some cautiousness with a private report that India may see around $30 billion
shaved off its total exports in the current fiscal year, as threats to cargo
vessels in the Red Sea lead to a surge in container shipping rates and prompt
exporters to hold back on shipments. Meanwhile, the Reserve Bank has raised the
minimum capital requirement for small finance banks to Rs 200 crore and
permitted Payments Bank to upgrade as SFBs. Banking stocks will be in focus
with a private report stating that gaining from high credit off-take and lower
credit costs, banks are likely to post 16.7 per cent year-on-year (Y-o-Y)
growth in net profit during the third quarter of the financial year ended
December 2023 (Q3 FY24). However, sequentially, net profit may shrink by 2.4
per cent over the second quarter ended September 2023 (Q2).
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
21,513.00
|
21,415.95
|
21,687.00
|
BSE
Sensex
|
71,355.22
|
71,043.59
|
71,924.32
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata
Steel
|
395.60
|
132.30
|
130.71
|
134.91
|
ONGC
|
193.11
|
217.65
|
216.24
|
219.94
|
State
Bank of India
|
147.40
|
627.90
|
620.30
|
640.25
|
Power
Grid
|
135.86
|
242.00
|
239.85
|
244.70
|
Kotak
Mahindra Bank
|
122.53
|
1825.85
|
1812.49
|
1845.34
|
- ONGC has successfully commenced
First Oil production from the deep-water KG-DWN-98/2 Block, situated off the
coast of Bay of Bengal.
- UltraTech Cement has introduced
five electric trucks for transport of clinker from its integrated cement
manufacturing unit Dhar Cement Works, located in Madhya Pradesh, to its
grinding unit Dhule Cement Works, located in Maharashtra.
- Dr Reddy's Laboratories is
recalling over 8,000 bottles of a generic medication used to prevent rejection
of a transplanted organ from the US market due to a packaging error.
- JSW Steel's subsidiary -- JSW
Utkal Steel has received the possession of land in Odisha for setting up a
greenfield steel plant.