Bulls made a
strong comeback on Dalal Street as Indian equity markets snapped the two-day
losing streak and ended higher with gains of over three percent on Tuesday, led
by buying across the sectors amid easing Ukraine Russia-tensions. Report stated
that some Russian troops in military districts adjacent to Ukraine are
returning to their bases after completing drills, a move that could de-escalate
frictions between Moscow and the West. Markets started trade on a positive note
but soon pared some of their opening gains, as traders got anxious with data
showing that retail inflation soared to a seven-month high of 6.01 per cent in
January, breaching the upper tolerance level of the Reserve Bank, driven by
rising prices certain food items. The inflation in the food basket was 5.43 per
cent in January 2022 as against 4.05 per cent in the preceding month. But, key
gauges regained traction in the afternoon session, taking support from report
that in an effort to tame food inflation, the government has reduced import
duty on lentils to nil for Australia and Canada origins and cut it to 22%, from
30%, for those originating in the US. Buying further crept in with a report
stated that India and the UAE are likely to sign a free trade agreement (FTA) on
February 18, under which both the countries could give duty-free access to a
number of products from different sectors. Additional support also came after
India's overall exports (Merchandise and Services combined) in January 2022 are
estimated to be $61.41 billion, exhibiting a positive growth of 36.76 per cent
over the same period last year and a positive growth of 38.90 per cent over
January 2020. Traders also took note of report stated that the outstanding
portfolio of the microfinance industry registered a 2 per cent
quarter-and-quarter growth to around Rs 2,26,000 crore as of September 2021.
The same stood at Rs 2,22,060 crore during the three months ended June 2021.
Finally, the BSE Sensex rose 1736.21 points or 3.08% to 58,142.05 and the CNX
Nifty was up by 509.65 points or 3.03% to 17,352.45.
The US markets ended higher on
Tuesday after Russia appeared to be backing away from an immediate invasion of
Ukraine, cooling geopolitical tensions that have knocked the stock market down
the last three days. Russian Defense Ministry spokesman Igor Konashenkov said
units from Russia's southern and western military districts, which border
Ukraine, have already begun returning to their bases after completing combat
training. On the sectoral front, airline stocks turned in some of the market's
best performances on the day, with the NYSE Arca Airline Index soaring by 5.6
percent. The index ended the session at its best closing level in three months.
Substantial strength was also visible among semiconductor stocks, as reflected
by the 5.5 percent spike by the Philadelphia Semiconductor Index. Networking
stocks also saw considerable strength on the day, resulting in a 3.9 percent
surge by the NYSE Arca Networking Index. On the economic data front, Producer
prices in the US jumped by much more than expected in the month of January,
according to a report released by the Labor Department. The Labor Department
said its producer price index for final demand surged up by 1.0 percent in
January after rising by an upwardly revised 0.4 percent in December. Street had
expected producer prices to increase by 0.5 percent compared to the 0.2 percent
uptick originally reported for the previous month. Meanwhile, after reporting a
slight decrease in regional manufacturing activity in the previous month, the
Federal Reserve Bank of New York released a report showing a modest increase in
activity in the month of February. The New York Fed said its general business
conditions index rose to a positive 3.1 in February from a negative 0.7 in
January.
Crude oil futures ended deeply in
red on Tuesday as worries about supply disruptions eased amid the de-escalation
of tensions between Russia and Ukraine. Russian Defense Ministry spokesman Igor
Konashenkov said units from Russia's southern and western military districts,
which border Ukraine, have already begun returning to their bases after
completing combat training. The news has helped ease concerns about a Russian
invasion of Ukraine and crude oil supply disruptions. Benchmark crude oil
futures for March delivery dropped $3.39 or 3.6 percent to settle at $92.07 a
barrel on the New York Mercantile Exchange. Brent crude for April delivery fell
$3.31 or3.47 percent to settle at $93.17 a barrel on London's Intercontinental
Exchange.
Snapping 5-day drubbing, Indian
rupee appreciated significantly against dollar on Tuesday, tracking recovery in
domestic equities and weakness of the American currency overseas. Sentiments
were upbeat with report that India's merchandise exports rose 25.28 per cent to
$34.50 billion in January 2022 as compared to $27.54 billion in January 2021,
on account of healthy performance by sectors such as engineering, petroleum and
gems and jewellery. Traders shrugged off report that retail inflation soared to
a seven-month high of 6.01 per cent in January, breaching the upper tolerance
level of the Reserve Bank, driven by rising prices certain food items. On the
global front, euro rebounded on Tuesday, nearly erasing all of Monday's losses,
after reports that some Russian troops in areas near Ukraine have started
returning to their bases. Finally, the rupee ended at 75.32 (Provisional),
stronger by 28 paise from its previous close of 75.60 on Monday.
The FIIs as per Tuesday's data
were net sellers in equity segment, while net buyers in debt segment. In equity
segment, the gross buying was of Rs 6266.22 crore against gross selling of Rs
9410.53 crore, while in the debt segment, the gross purchase was of Rs 744.47
crore against gross selling of Rs 427.69 crore. Besides, in the hybrid segment,
the gross buying was of Rs 122.81 crore against gross selling of Rs 13.22
crore.
The US markets ended higher on
Tuesday amid signs of de-escalating tensions along the Russia-Ukraine border.
Asian markets are trading mostly in green on Wednesday as fears of a Russian
invasion of the Ukraine dissipated after Moscow indicated it was returning some
troops to base from exercises, delivering investors a measure of relief. Indian
markets staged a stellar comeback on Tuesday, after suffering their worst
losses in a year in the previous session, as bargain hunters piled into energy,
finance and IT stocks amid signs of easing Russia-Ukraine tensions. Today,
domestic indices are likely to make optimistic start tracking gains in US
markets overnight and strong Asian markets. Some support will come as India's
exports in January rose 25.28 per cent to $34.50 billion on account of healthy
performance by sectors such as engineering, petroleum and gems and jewellery.
Additionally, an SBI research report stated that India can add $20 billion to
its Gross Domestic Product (GDP) if the country can reduce by 50 per cent the
dependence on imports from China by leveraging the production linked incentive
schemes. However, there will be some cautiousness as government data showed
exports from special economic zones (SEZs) grew at a slower pace as compared to
the growth of overall outbound shipments from the country during the first
eight months of the current fiscal year. Traders may take note of a private
report expects RBI to leave key policy rates unchanged throughout the first
half of 2022, despite retail inflation rising to 6.01 per cent in January, and
likely to remain elevated till April. Meanwhile, the World Bank has called on
developing countries to improve the health of their financial sectors, warning
that risks created by the COVID-19 pandemic had led to certain fragilities from
what it called non-transparent debt. NBFCs sector stocks will be in focus as
the Reserve Bank of India (RBI) has given finance companies extra time till
September 30, 2022 to have systems ready to implement rule wherein bad loans
can be upgraded as standard asset only when entire arrears of interest and
principal are paid. In November 2021, RBI had given time till March 31, 2022 to
implement the rule. Shares of the Manyavar-brand owned company to debut on the
bourses today. The issue was subscribed 2.57 times, and the final issue price
was fixed at Rs 866 per share.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,352.45
|
17,002.80
|
17,538.55
|
BSE
Sensex
|
58,142.05
|
56,983.22
|
58,756.13
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Oil & Natural Gas Corporation
|
311.46
|
164.50
|
157.26
|
170.86
|
Tata Motors
|
306.23
|
503.00
|
478.36
|
516.56
|
State Bank of India
|
238.42
|
524.00
|
505.11
|
534.86
|
ICICI Bank
|
188.80
|
775.00
|
752.80
|
787.60
|
Coal India
|
168.50
|
164.15
|
161.05
|
166.05
|
Reliance Industries' wholly-owned subsidiary -- Jio is all set to acquire about 17 per cent stake in SoftBank-backed Inmobi's Glance platform for $200 million (about Rs 1,500 crore).
Coal India has reported 47.74% rise in its consolidated net profit at Rs 4,556.54 crore for Q3FY22 as compared to Rs 3,084.10 crore for the same quarter in the previous year.
IndusInd Bank has been empanelled by the SFAC to facilitate digital collection and settlement services on e-NAM portal for the transactions between farmers and traders across the country.
Eicher Motors has reported 14.36% fall in its consolidated net profit at Rs 456.13 crore for Q3FY22 as compared to Rs 532.59 crore for the same quarter in the previous year.