Indian equity benchmarks extended
their rally for the seventh straight day on Monday, with the Nifty hitting a
fresh record closing high during the session and the Sensex reclaiming the
67,000 mark on all-round buying. The successful G20 summit and buying in index
majors Power Grid Corporation and Axis Bank also added to the winning momentum
in equities. The markets made a gap up opening and traded with a positive bias
throughout the day, as traders got encouragement after Finance Minister Nirmala
Sitharaman said India's external debt of $624.7 billion at March-end 2023 with
a debt-service ratio of 5.3 per cent is within the comfort zone and modest from
a cross-country perspective. Some support also came in as the Reserve Bank said
India's forex reserves jumped by $4.039 billion to $598.897 billion for the
week ended September 1. In the previous reporting week, the overall reserves
had dropped by $30 million to $594.858 billion. Key gauges extended gains in
late afternoon deals as sentiments remained upbeat with private report stating
that India is well placed to benefit from geopolitical and economic trends that
are driving the diversification of Asia's manufacturing supply chain, and it is
also the country's manufacturing moment. Some optimism also came as India and
Brazil have agreed to work together for the expansion of India-Mercosur
preferential trade agreement (PTA) to further promote economic ties. Traders
also took a note of report stating that India needs to grow at 8-9 per cent for
the next 20 years to become a developed nation by 2047 as envisioned by Prime
Minister Narendra Modi. Traders overlooked provisional data from the National
Stock Exchange (NSE) showing that foreign institutional investors (FII) sold
shares worth Rs 224.22 crore on September 8. Finally, the BSE Sensex rose
528.17 points or 0.79% to 67,127.08 and the CNX Nifty was up by 176.40 points
or 0.89% to 19,996.35.
The US markets ended higher on
Monday with Nasdaq settling over one percent higher, on easing concerns about
the outlook for interest rates after a private report suggested a shift in
Federal Reserve officials' stance on rates. The central bank is likely to pause
its recent series of rate hikes next week then take a harder look at whether
more are needed. While some Fed officials to still prefer to err on the side of
raising rates too much, other see risks as more balanced and worry about
unnecessarily causing a downturn or triggering financial turmoil. The
tech-heavy Nasdaq received a boost from a surge by shares of Tesla, with the
electric car maker spiking by 10.1 percent after private broker upgraded its
rating on the company's stock to Overweight from Equal-Weight. Chipmaker
Qualcomm also jumped by 3.9 percent after announcing an agreement with Apple to
supply Snapdragon 5G Modem-RF Systems for smartphone launches in 2024, 2025 and
2026. Moreover, shares of Hostess Brands (TWNK) soared by 19.1 percent after
the Twinkie maker agreed to be acquired by J.M. Smucker (SJM) in a cash and
stock transaction valued at approximately $5.6 billion. On the sectoral front,
Airline stocks turned in a strong performance on the day, resulting in a 1.7
percent advance by the NYSE Arca Airline Index. The index continued to regain
ground after ending last Thursday's trading at a four-month closing low.
Retail, tobacco and software stocks also saw notable, while oil and natural gas
stocks came under pressure over the course of the session.
Crude oil futures ended in red on
Monday on demand Concerns. Concerns about the outlook for energy demand from
China hurt oil prices. Traders looked ahead to the release of key U.S.
inflation and other data this week that could have a significant impact on the
outlook for interest rates. Oil prices retreated a bit after having climbed to
10-month highs last week on Saudi Arabia and Russia's decision to extend their
supply cuts. Benchmark crude oil futures for October delivery fell $0.22 or 0.3
percent to settle at $87.29 a barrel on the New York Mercantile Exchange.
However, Brent crude for November delivery added $0.20 or 0.22 percent to
settle at $90.64 a barrel on London's Intercontinental Exchange.
The Indian rupee ended weaker
against the US dollar on Monday despite positive cues from domestic equity
markets. Investors awaited India's retail inflation data for August and
industrial output figures for July, due on tomorrow. Traders overlooked Reserve
Bank's statement that India's forex reserves jumped by $4.039 billion to
$598.897 billion for the week ended September 1. In the previous reporting
week, the overall reserves had dropped by $30 million to $594.858 billion. On
the global front, yen jumped on Monday as comments from Bank of Japan (BOJ)
Governor Kazuo Ueda stoked hopes that Japan could soon herald a new era away
from negative rates, while the dollar slid ahead of this week's key U.S.
inflation reading. Finally, the rupee ended at 83.03 (Provisional), weaker by 1
paisa from its previous close of 83.02 on Friday.
The FIIs as per Monday's data
were net sellers in equity segment, while they were net buyers in debt segment.
In equity segment, the gross buying was of Rs 9886.47 crore against gross
selling of Rs 9983.54 crore, while in the debt segment, the gross purchase was
of Rs 550.39 crore with gross sales of Rs 543.50 crore. Besides, in the hybrid
segment, the gross buying was of Rs 47.74 crore against gross selling of Rs
49.15 crore.
The US markets ended higher on
Monday as signs of easing inflation and comments from Treasury Secretary Janet
Yellen boosted hopes that the U.S. economy is headed toward a soft landing.
Asian markets are trading mostly in red on Tuesday ahead of key U.S. inflation
data that could signal that U.S. interest rates may have peaked. Indian markets
closed the session with robust gains and extended their winning streak for the
seventh straight session day on Monday, as enthusiasm over the G20 Summit
outweighed muted cues from global markets. Today, domestic indices are likely
to extend previous session's gaining momentum with positive start tracking
overnight gains on Wall Street and ahead of the India's August consumer
inflation and July Index of Industrial Production (IIP) data, which will be
released after market hours. There are expectations that August retail
inflation to have cooled down from a 15-month high of 7.44 per cent in July as
vegetable prices moderated. Foreign fund inflows likely to support domestic
sentiments. Provisional data from the National Stock Exchange (NSE) showed that
foreign institutional investors (FII) purchased shares worth Rs 1,473.09 crore on
September 11. Some support will come as commerce and industry minister Piyush
Goyal said India and Saudi Arabia can look at doubling bilateral trade to $100
billion in the coming years from about $52 billion at present while making it
more balanced. Traders may take note of Secretary in the Department for
Promotion of Industry and Internal Trade (DPIIT) Rajesh Kumar Singh's statement
that the government is looking at further easing foreign direct investment
(FDI) norms in the space sector to attract overseas players. Meanwhile, India
has agreed to bring down the import duty to 5-10 per cent on some fresh and
processed food items as part of a larger dispute settlement between New Delhi
and Washington at the World Trade Organization (WTO). The duties will be
reduced on import of frozen turkey, frozen duck, fresh/frozen/dried/processed
blueberries, and cranberries. Currently, these items attract import duty of
around 30-45 per cent. Stocks related to steel will be in focus as India
imposed an anti-dumping duty on some Chinese steel for five years, according to
a government notification, following concern raised by the steel industry over
potential dumping by Chinese sellers. Railways and infrastructure relates
stocks likely to be in limelight in the near term following the announcement of
the India-Middle East-Europe Economic Corridor IMEC) after the just-concluded
G20 summit.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
19,996.35
|
19,905.09
|
20,047.89
|
BSE
Sensex
|
67,127.08
|
66,851.23
|
67,287.52
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Steel
|
333.78
|
131.10
|
129.59
|
132.24
|
NTPC
|
224.93
|
243.00
|
239.46
|
245.21
|
Adani Ports
|
206.38
|
883.55
|
849.96
|
902.16
|
HDFC Bank
|
157.87
|
1633.00
|
1625.84
|
1638.34
|
Coal India
|
145.05
|
278.85
|
276.00
|
282.95
|
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