Daily Newsletter
NSE Intra-day chart (07 January 2022)
Top Gainers
Company NameClose% Change
Top Losers
Company NameClose% Change
World Indices
IndicesLast Trade% Change
Indices
IndicesLast Trade% Change
FII Activity(Rs. Cr)
DateMarketGross PurchaseGross SalesNet Change
Equity
Debt
Equity
Debt
Equity
Debt
DII Investments(Rs. Cr)
DateBuy ValueSale ValueNet Value
 
Market Commentary 10 January 2022
Markets likely to open in green following Asian peers

 

Indian equity benchmarks managed to end higher in highly volatile trade on Friday led by gains in basic materials, oil and gas and energy stocks. The beginning was upbeat as traders took encouragement with report which claimed that the Emergency Credit Line Guarantee Scheme (ECLGS) launched by the government in 2020 to provide relief to MSMEs impacted by COVID-19 pandemic has saved 13.5 lakh firms from going bankrupt and consequently 1.5 crore jobs. The street were getting relief with private report stated that private equity investments hit a record high of $40.1 billion in 2021, an increase of over 15 per cent from the previous year, led by a $3.6 billion flow into Flipkart and $1.93 billion into Bundl Technologies.  The strength in the markets was being supported as the finance ministry released monthly revenue deficit grant to 17 states totalling Rs 9,871 crore. So far, an amount of Rs 98,710 crore has been released to 17 states as post devolution revenue deficit grant in the current financial year. However, the headline indices were sharply off their respective day's highs and traded with marginal losses in afternoon deals, as caution prevailed among investors globally amid increasing cases of the Omicron variant of COVID-19. Traders turned anxious with India Ratings and Research's statement that the Omicron variant spread will impact the January-March quarter GDP by 0.40 per cent and shave off 0.10 per cent from the FY22 growth, as many states resort to restrictions to limit infections. But, selling proved short-lived as key gauged bounced back into green terrain in late hour of trade, taking support from a senior government official said that the Omicron wave of coronavirus is unlikely to have much impact on India's economic growth, not more than of 5-10 basis points. Traders took note of report that amid fears that the new coronavirus variant may disrupt normal business activity, industry chamber CII pitched for coordinated actions by the Centre and state governments to minimize the impact of Omicron on the economy.  Finally, the BSE Sensex rose 142.81 points or 0.24% to 59,744.65 and the CNX Nifty was up by 66.80 points or 0.38% to 17,812.70.

 

The US markets settled in red on Friday following the release of the Labor Department's closely watched monthly jobs report. While the report showed much weaker than expected job growth in the month of December, the unemployment rate still fell by more than expected. The report said non-farm payroll employment rose by 199,000 jobs in December after climbing by an upwardly revised 249,000 jobs in November. Street had expected employment to jump by 400,000 jobs compared to the addition of 210,000 jobs originally reported for the previous month. Despite the weaker than expected job growth, the unemployment rate slid to 3.9 percent in December from 4.2 percent in November. The unemployment rate was expected to edge down to 4.1 percent. With the bigger than expected decrease, the unemployment rate fell to its lowest level since hitting 3.5 percent in February of 2020. Street have indicated the report is not likely to alter the Fed's plans to accelerate monetary policy normalization. Traders subsequently seem concerned the Fed will be raising rates at a time of slowing economic growth as a result of the Omicron variant of the coronavirus. On the sectoral front, housing stocks moved sharply lower amid concerns about the impact of higher interest rates, resulting in a 3.3 percent nosedive by the Philadelphia Housing Sector Index. Substantial weakness was also visible among semiconductor stocks, as reflected by the 2.9 percent plunge by the Philadelphia Semiconductor Index. Networking and biotechnology stocks also saw considerable weakness, contributing to the steep drop by the tech-heavy Nasdaq. On the other hand, airline stocks moved sharply higher on the day, driving the NYSE Arca Airline Index up by 2.9 percent. Steel, banking and energy stocks also saw notable strength, with the continued advance by energy stocks coming despite a pullback by the price of crude oil.

 

Paring initial gains, crude oil futures ended lower on Friday as investors continued to monitor unrest in Kazakhstan that threatens to add to supply outages that have helped boost crude prices. Kazakhstan produces about 1.6 million barrels of oil per day. Russia has reportedly sent its paratroopers into Kazakhstan to help control a countrywide uprising that erupted after widespread violence. Elsewhere, the political situation in Libya continues to deteriorate and sideline oil output. Production in Libya has dropped to 729,000 barrels per day from a high of 1.3 million bpd last year, partly due to pipeline maintenance work. Investors also continued to bet on hopes the Omicron variant of the coronavirus will not significantly impact global oil demand. Benchmark crude oil futures for February delivery fell 56 cents or 0.7 percent to settle at $78.90 a barrel on the New York Mercantile Exchange. Brent crude for March delivery lost 24 cents or 0.3 percent to settle at $81.75 a barrel on London's Intercontinental Exchange.

 

Indian Rupee ended higher against US dollar on Friday, on the back of selling of the American currency by exporters. Traders took solace with private report stated that private equity investments hit a record high of $40.1 billion in 2021, an increase of over 15 per cent from the previous year, led by a $3.6 billion flow into Flipkart and $1.93 billion into Bundl Technologies.  However, upside remain capped as caution prevailed among investors globally amid increasing cases of the Omicron variant of COVID-19. Traders also turned anxious with India Ratings and Research's statement that the Omicron variant spread will impact the January-March quarter GDP by 0.40 per cent and shave off 0.10 per cent from the FY22 growth, as many states resort to restrictions to limit infections. On the global front, Sterling was on track on Friday for weekly gains against the dollar and euro to start 2022, despite a mixed picture emerging for Britain's economy. Finally, the rupee ended 74.34, stronger by 8 paise from its previous close of 74.42 on Thursday.

 

The FIIs as per Friday's data were net sellers in equity debt segment, while they were net buyers in debt segment. In equity segment, the gross buying was of Rs 6607.37 crore against gross selling of Rs 8304.41 crore, while in the debt segment, the gross purchase was of Rs 408.12 crore with gross sales of Rs 100.45 crore. Besides, in the hybrid segment, the gross buying was of Rs 17.65 crore against gross selling of Rs 16.19 crore.

 

The US markets ended lower on Friday as treasury yields rose in anticipation Federal Reserve will raise rates as soon as March. Asian markets are trading mostly in green on Monday as investors kept an eye on rising interest rates and coronavirus cases. Indian markets finished session higher on Friday as gains in banks and financial stocks pushed the benchmarks higher. Today, the markets are likely to open in green following positive cues from Asian peers. Traders will be taking encouragement as the National Statistical Office (NSO) in its first advance estimate indicated that the Indian economy remains on track to regain its position as the world's fastest-growing major economy and put the GDP expansion at a tempered 9.2 per cent this fiscal amid concerns over the impact of a resurgent virus on the fragile recovery. Also, an SBI Ecowrap report said India's real GDP is expected to grow at around 9.5 per cent in 2021-22 on a year-on-year (YoY). Some support will come with report that after three months of selling spree, foreign investors have turned net buyers in the first week of January by infusing Rs 3,202 crore in Indian equities, as correction in markets provided them good buying opportunity. Though, some cautiousness may come as the Confederation of All India Traders (CAIT) said increase in Covid cases along with imposition of various restrictions by different states have had an adverse impact on business and economic activities across the country. Besides, the RBI data showed the country's foreign exchange reserves declined by $1.466 billion to $633.614 billion in the week ended December 31. In the previous week ended December 24, the reserves dipped by $587 million to $635.08 billion. Meanwhile, the government has decided not to impose anti-dumping duty on certain steel products being imported from countries like China, Japan, and Korea, as the finance ministry has not accepted the recommendations of the directorate general of trade remedies (DGTR). There will be some buzz in the insurance industry stocks with report that after a stellar performance in November - following a poor show in October - the new business premium (NBP) of life insurance companies was largely flat in December. FMCG stocks will be in focus with a report that FMCG companies witnessed an increase in demand in the past two weeks as consumers stocked up in the wake of rise in COVID-19 cases across the country, and have ramped up supplies to their stockists to avoid supply shortage. There will be some reaction is power stocks as total outstanding dues owed by electricity distribution companies (discoms) to power producers rose 4.4 per cent year-on-year to Rs 1,21,030 crore in January 2022.

 

                                Support and Resistance: NSE (Nifty) and BSE (Sensex)

 

Index

Previous close

Support

Resistance

NSE Nifty

17,812.70

17,709.84

17,910.29

BSE Sensex

59,744.65

59,387.34

60,116.08

 

Nifty Top volumes

 

Stock

Volume

Previous close (Rs)

Support  (Rs)

Resistance (Rs)

(in Lacs)

Oil & Natural Gas Corporation

308.89

157.10

153.14

159.29

State Bank of India

227.46

491.25

486.49

498.99

Tata Motors

155.32

489.85

483.90

495.65

ICICI Bank

122.50

794.50

786.40

802.45

Coal India

116.79

156.50

155.15

157.65

 

  • Titan Company has witnessed strong demand across its consumer businesses and clocked 36% growth for Q3FY22 over the festive quarter last year. 
  • HCL Technologies has completed the acquisition of 51% stake in German IT consulting company Gesellschaft fur Banksysteme GmbH. 
  • Reliance Industries' retail arm -- RRVL has acquired 25.8 per cent stake in Dunzo, India's leading quick commerce player, for $200 million.
  • Dr. Reddy's Laboratories has partnered with University of Hyderabad for developing cold chain logistics solutions for pharmaceutical firms.
News Analysis