Indian equity benchmarks extended
up move for yet another session and gained over half a percent on Wednesday.
Sensex past the psychological 60,000-mark and Nifty inched towards 18000 level
on the back of softening inflation and strong FII buying in the current month.
After the flat start, the benchmarks gradually inched higher as the day
progressed, as traders took some encouragement as State Bank of India's (SBI)
Chairman Dinesh Khara said that things might get better on the inflation front
towards the end of September. He said the supply side constraints getting
addressed and crude oil prices trending low will help ease the situation. Some
support also came in as Moody's Analytics in a recent report on the Asia Pacific
(APAC) region said global oil prices are expected to fall to almost $70 per
barrel by the end of 2024. Domestic sentiments remained optimistic in late
afternoon deals, amid a private report stating that companies in India are
expected to give a salary hike of 10 per cent in 2023 as they struggle with
rising attrition in the tight labour market. Some comfort also came as the UK
India Business Council sees opportunities for trade, investment, and
collaboration with India across financial technology (fintech), food and
beverage, electric vehicle (EV), and other sectors. Traders took a note of a
private report that the UK India Business Council sees opportunities for trade,
investment, and collaboration with India across financial technology (fintech),
food and beverage, electric vehicle (EV), and other sectors. Meanwhile, another
private report stated that the Goods and Services Tax (GST) Council may make
rate changes in some services or products and withdraw some exemptions in a bid
to correct instances of inverted duty. Finally, the BSE Sensex rose 417.92
points or 0.70% to 60,260.13 and the CNX Nifty was up by 119.00 points or 0.67%
to 17,944.25.
The US markets settled in red on
Wednesday with Nasdaq ending lower of over one percent after the Federal
Reserve released the minutes of its latest monetary policy meeting. The Fed
minutes reaffirmed the central bank's plans to continue raising interest rates
in an effort to return inflation to its 2 percent objective. The minutes did
not provide specific guidance regarding the pace of future rate hikes, noting
that the extent of future policy tightening would depend on the implications of
incoming data for the economic outlook and risks to the outlook. The Fed did
reveal that meeting participants believed it would be necessary to move to a
restrictive stance of policy due to inflation remaining well above the Fed's
objective. Traders were also reacting to a Commerce Department report showing
US retail sales came in flat in July amid pullbacks in gas station and auto
sales. The Commerce Department said retail sales were virtually unchanged in
July after climbing by a downwardly revised 0.8 percent in June. Street had
expected retail sales to inch up by 0.1 percent compared to the 1.0 percent
jump originally reported for the previous month. Excluding gas station and auto
sales, however, retail sales rose by 0.7 percent in July, matching the increase
seen in the previous month. On the sectoral front, Gold stocks showed a
substantial move to the downside on the day, dragging the NYSE Arca Gold Bugs
Index down by 3.5 percent. Semiconductor stocks also saw significant weakness
on the day, resulting in a 2.5 percent slump by the Philadelphia Semiconductor
Index.
Crude oil futures ended higher on
Wednesday as data showed declines in crude and gasoline inventories in the US
in the week ended August 12. Data from US Energy Information Administration
(EIA) showed crude stockpiles in the US dropped by 7.1 million barrels last
week, nearly three times the expected drop. The data showed gasoline
inventories also fell 4.6 million barrels last week, while distillate stockpiles
edged up by 0.8 million barrels. The American Petroleum Institute (API) on
Tuesday reported a draw for crude oil stocks of 448,000 barrels for the week
ended August 12, while analysts predicted a smaller draw of 117,000 barrels. Benchmark
crude oil futures for September delivery rose $1.58 or about 1.8 percent to
settle at $88.11 a barrel on the New York Mercantile Exchange. Brent crude for
October delivery gained $1.31 or 1.42 percent to settle at $93.65 a barrel on
London's Intercontinental Exchange.
Indian rupee strengthened sharply
against the dollar on Wednesday as heavy buying in domestic equities and persistent
foreign capital inflows strengthened investor sentiment. Besides, softening
crude oil prices and easing inflationary pressures supported the domestic unit.
Traders took some encouragement as State Bank of India's (SBI) Chairman Dinesh
Khara said that things might get better on the inflation front towards the end
of September. He said the supply side constraints getting addressed and crude
oil prices trending low will help ease the situation. Some support also came in
as Moody's Analytics in a recent report on the Asia Pacific (APAC) region said
global oil prices are expected to fall to almost $70 per barrel by the end of
2024. On the global front, the dollar held onto gains against other major
currencies on Wednesday, ahead of the release of minutes of the U.S. Federal
Reserve's July meeting that could give further clues about the pace of further
interest rate hikes. Finally, the rupee ended at 79.45 (Provisional), stronger
by 29 paisa from its previous close of 79.74 on Friday.
The FIIs as per Wednesday's data
were net buyers in equity segment and net sellers in debt segment. In equity
segment, the gross buying was of Rs 26139.64 crore against gross selling of Rs 11876.29
crore, while in the debt segment, the gross purchase was of Rs 750.89 crore
against gross selling of Rs 927.26 crore. Besides, in the hybrid segment, the
gross buying was of Rs 16.30 crore against gross selling of Rs 22.46 crore.
The US markets settled lower on
Wednesday after minutes from the Federal Reserve's meeting in July suggested
policymakers may be less aggressive than previously thought when they raise
interest rates in September. Asian markets are trading mostly in red on
Thursday following the broadly negative cues from global markets overnight,
with weakness across most sectors. Indian markets closed higher on Wednesday,
as cooling inflation and buying in PSU bank, power and information technology
stocks saw the Sensex vault pass 60,000 after more than four months. Today,
markets are likely to make cautious start mirroring weak global cues. Some
cautiousness may come as former deputy chairman of the erstwhile Planning
Commission Montek Singh Ahluwalia said it would be unrealistic to assume that
India would record a sustained growth of 8 per cent, which is needed to become
a developed nation by 2047. However, some respite may come later in the day as
the ministry of statistics and programme implementation in its final Annual
Survey of Industries (ASI) said manufacturing sector investments grew 20.9% in
2019-20 over the previous fiscal. Traders may take note of report that with RBI
hiking the lending rate, the Union Cabinet earmarked Rs 34,856 crore towards
the interest subvention scheme to help banks provide short term agriculture
loans of up to Rs 3 lakh at a rate of 7 per cent. Information and Broadcasting
Minister Anurag Singh Thakur said the Cabinet has decided to restore interest
subvention on short term agriculture loans to 1.5 per cent for all financial
institutions. Besides, foreign institutional investors (FIIs) have net bought
shares worth Rs 2,347.22 crore on August 17, as per provisional data available
on the NSE. Meanwhile, the Union Cabinet has approved a proposal to increase
the limit of the Emergency Credit Line Guarantee Scheme (ECLGS) by Rs. 50,000
crore to Rs. 5 trillion. The additional amount is being earmarked for entities
in hospitality and related sectors. There will be some buzz in coal industry
stocks as union coal minister Pralhad Joshi said the ministry of coal is
targeting production of 900 million tonne (MT) this financial year and national
miner Coal India would produce 700 MT coal. Telecom stocks will be in focus as
data released by sector regulator Trai showed that telecom subscriber base in
the country grew marginally to 117.29 crore in June with Reliance Jio adding
maximum number of new customers. There were 117.07 crore subscribers in May
2022. There will be some reaction in oil and gas sector stocks as OPEC in its
monthly oil report said that India's demand for petroleum products like petrol
and diesel will grow by 7.73 per cent in 2022, the fastest pace in the world.
It added that India's demand for oil products is projected to rise from 4.77
million barrels per day (bpd) in 2021 to 5.14 million bpd in 2022.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,944.25
|
17,863.09
|
17,995.69
|
BSE
Sensex
|
60,260.13
|
59,970.87
|
60,436.32
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Steel
|
540.08
|
112.40
|
111.94
|
113.19
|
NTPC
|
196.74
|
161.40
|
159.05
|
163.70
|
Tata Motors
|
159.48
|
484.65
|
481.10
|
491.30
|
Oil & Natural Gas Corporation
|
156.94
|
139.80
|
138.74
|
140.84
|
Hindalco Industries
|
122.97
|
438.00
|
428.94
|
444.74
|
NTPC has floated a tender to raise Rs 5,000 crore term loan from financial institutions.
Bharti Airtel has paid Rs 8312.4 crore to the Department of Telecom towards dues for spectrum acquired in the recently concluded 5G auctions.
UPL has collaborated with Oro Agri for the co-distribution and further development of Orange Oil, a biosolution effective against a wide range of pests and diseases.
State Bank of India has started insolvency process by filing an insolvency petition against the country's largest sugar firm Bajaj Hindusthan Sugar.