Indian equity
benchmarks snapped a four-day losing streak to end higher in the volatile
session on Tuesday led by strong buying interest in Realty, IT and TECK stocks.
Key indices made weak start, as traders remained cautious with rating agency
Icra's statement that the ongoing conflict between Ukraine and Russia will
burden domestic steelmakers with high input costs. Some cautiousness also came
as a Crisil report warned that the Russian invasion of Ukraine, and the flurry
of punitive sanctions imposed on the former by the US and European nations,
have the potential to cull India's imports on one hand and also lead to input
cost pressure on downstream companies in India Inc. Selling further crept in as
a private report has downgraded Indian equities from overweight to underweight citing
soaring oil prices that hit a 14-year high of over $140 a barrel in trade on
Monday. However, domestic indices reversed their trend and traded with gains in
late afternoon deal, taking support from private report stating that hiring
activity witnessed a 31 per cent increase in February as multiple sectors
recorded strong growth compared to the previous year. Traders also found some
solace with Commerce and Industry Minister Piyush Goyal's statement that goods
exports will exceed the ambitious target set for the current fiscal and touch
$410 billion, despite the supply-side disruptions caused by the Russia-Ukraine
conflict. Traders also took a note of Credit rating agency, India Ratings and
Research (Ind-Ra) report stated that the direct impact of the Russia-Ukraine
war on Indian credits appears to be limited. Ind-Ra's initial assessment
indicates that the impact would be largely restricted to small entities and
those at the lower end of the credit spectrum. Finally, the BSE Sensex rose
581.34 points or 1.10% to 53,424.09 and the CNX Nifty was up by 150.30 points
or 0.95% to 16,013.45.
The US markets ended lower on
Tuesday as investors continue to assess geopolitical tensions between Russia
and Ukraine and high commodity prices. Cautiousness also prevailed in the
markets as crude oil prices continued to skyrocket as President Joe Biden
officially announced a US ban on the import of Russian oil, liquefied natural
gas, and coal in response to Russia's unprovoked invasion of Ukraine. Biden
acknowledged many European countries would not be able to join the US in the
ban but said his administration would work with their partners to reduce their
dependence on Russian energy. Earlier in the day, the European Union's
executive arm the European Commission had pledged to reduce Russian gas imports
by two-thirds by the end of this year. On the sectoral front, Steel stocks
showed a substantial move to the downside amid worries about global economic
growth, with the NYSE Arca Steel Index plunging by 2.8 percent. Significant
weakness was also visible among healthcare stocks, as reflected by the 2
percent slump by the Dow Jones US Health Care Index. Utilities, tobacco and
natural gas stocks also moved to the downside on the day. The Dow Jones Utility
Average gave back ground after ending the previous session at a record closing
high. However, airline stocks moved sharply higher over the course of the
session, with the NYSE Arca Airline Index soaring by 5.6 percent after ending
the previous session at its lowest closing level in over a year.
Crude oil futures ended sharply
higher on Tuesday, magnifying their many previous sessions' rally, on concerns
about global oil supply after US President Joe Biden announced a ban on import
of Russian energy products. Biden said the decision to ban Russian energy
products was taken after close consultation with allies around the world,
particularly in Europe. Earlier, the United Kingdom announced its own
restrictions on buying Russian oil imports, saying it will phase out the
country's imports by the end of the year. The European Union also unveiled a
plan to wean itself off of Russian fossil fuels. Benchmark crude oil futures
for April delivery rose $4.30 or 3.6 percent to settle at $123.70 a barrel on
the New York Mercantile Exchange. Brent crude for May delivery surged $5.52 or
4.5 percent to settle at $128.73 a barrel on London's Intercontinental
Exchange.
Continuing previous session
drubbing, Indian rupee concluded substantially weaker against dollar on Tuesday
on account of continued dollar demand from importers and banks. Sentiments
remained dented as a steep rise in oil prices fanned fears of runaway inflation
and slowing economic growth. However, downfall remain capped with Commerce and
Industry Minister Piyush Goyal's statement that goods exports will exceed the
ambitious target set for the current fiscal and touch $410 billion, despite the
supply-side disruptions caused by the Russia-Ukraine conflict. On the global
front, euro was trading near 22-month lows on Tuesday as war in Ukraine darkens
Europe's economic outlook, while currencies lifted by rocketing energy prices
paused after a weeks-long rally. Finally, the rupee ended at 77.00
(Provisional), weaker by 7 paise from its previous close of 76.93 on Monday.
The FIIs as per Tuesday's data
were net sellers in both equity and debt segment. In equity segment, the gross
buying was of Rs 6732.84 crore against gross selling of Rs 14654.07 crore,
while in the debt segment, the gross purchase was of Rs 197.70 crore against
gross selling of Rs 213.78 crore. Besides, in the hybrid segment, the gross
buying was of Rs 3.08 crore against gross selling of Rs 12.67 crore.
The US markets ended lower on
Tuesday as President Joe Biden officially announced a U.S. ban on Russian
imports of oil and energy. Asian markets are trading mostly in green on
Wednesday as investors assess the impact of a worsening Russia-Ukraine conflict.
Indian markets made a comeback on Tuesday, halting a losing streak that lasted
four straight trading sessions, helped by strength in financial and IT stocks.
Today, markets are likely to make slightly positive start amid gains across
most other Asian markets, though oil prices continued to rise after the US
banned Russia oil imports over Moscow's invasion of Ukraine. State election
results are just a day away, investors will likely take note of the exit polls
prior to that. Some support will come with report that the Agriculture Ministry
is ready with a new central scheme to promote natural farming in the country
with an estimated outlay of Rs 2,500 crore. The proposed new scheme on natural
farming will soon be placed before the Cabinet for approval. Traders may take
note of the Reserve Bank has extended the interest equalisation scheme for pre
and post shipment rupee credit for MSME exporters till March 2024 with the
objective of boosting outbound shipments. However, there may be some
cautiousness as rating agency Icra warned of serious downside risks to the
economy next fiscal with runaway current account deficit, steep fall in the
rupee and a hardening yields on government bonds, as a result of the
Russian-Ukraine crisis and the resultant spike in crude and other commodity
prices. Traders may be worried as Union Finance Minister Nirmala Sitharaman
expressed concern over rising crude prices due to the Ukraine crisis and
indicated that the central government is looking to tap alternative sources.
Metal stocks will be in focus with a private report that the price of steel
will continue to move upwards on good demand and as the supply chain remains
affected amid the Ukraine-Russia conflict. There will be some reaction in auto
stocks as India Ratings and Research (Ind-Ra) revised its outlook for the auto
sector to 'neutral' from 'improving' for 2022-23, saying supply-side
constraints and a muted rural demand will restrict growth. It said domestic
automobile sales volume is expected to grow 5-9 per cent year-on-year in
2022-23, after three consecutive years of decline, and is likely to fall 5-8
per cent in 2021-22. Meanwhile, a private report stated that LIC IPO has
received capital markets regulator SEBI's nod for its mega public issue. The
issue will entirely be an offer for sale (OFS) by the government that is
attempting to garner somewhere around Rs 63,000 crore to meet its divestment
target.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
16,013.45
|
15,780.35
|
16,137.65
|
BSE
Sensex
|
53,424.09
|
52,628.52
|
53,851.96
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Oil & Natural Gas Corporation
|
731.27
|
178.70
|
172.69
|
189.84
|
Tata Motors
|
555.43
|
391.30
|
379.95
|
399.05
|
State Bank of India
|
425.10
|
440.00
|
429.30
|
446.40
|
ITC
|
360.36
|
226.80
|
224.21
|
228.91
|
NTPC
|
285.72
|
133.25
|
130.56
|
135.86
|
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