Indian equity benchmarks bounced
back on Monday after a three-day fall and ended with gains of over half
percent, largely helped by buying in FMCG, Auto and TECK counters despite
weakness in global market. Key gauges made cautious start, as traders were
concerned with data from Reserve Bank showed India Inc's investment in their
overseas ventures dropped by 59 per cent on an annual basis to $1.03 billion in
August this year. Some pessimism also came in as the country's foreign exchange
reserves declined by $2.234 billion to stand at $550.871 billion for the week
ended September 9. However, key indices
quickly recovered the lost ground and traded higher, taking support from the
finance ministry's statement that gross direct tax collections grew 30 per cent
to Rs 8.36 lakh crore till September 17 of current fiscal year on higher
advance tax mop-up buoyed by the economic revival post pandemic. Some support
also came as foreign investors pumped Rs 12,000 crore into the Indian equity
market so far this month on hopes that global central banks, particularly the
US Fed, may go slow on rate hikes as inflation starts to cool off. Markets
continued to trade in fine fettle in late afternoon deals, as traders took some
solace with the Monthly Economic Report of the Department of Economic Affairs,
Ministry of Finance stating that India retained its status as an attractive
destination among a set of developed and developing economies, as the 5th
largest recipient of FDI in the April-June quarter. According to the report
released, during Q1 of 2022, India was the 5th largest recipient of FDI among
the defined set of developed and developing economies, as a buoyant growth
outlook coupled with steady improvement in ease of doing business and
supportive government policies retained India as an attractive business
destination. Some optimism also came with Prime Minister Narendra Modi's
statement that Indian economy is expected to grow by 7.5 per cent this year and
it will be the highest among the world's largest economies. He said India is
making progress to become a manufacturing hub while highlighting various
aspects of the country's economy. Finally, the BSE Sensex rose 300.44 points or
0.51% to 59,141.23 and the CNX Nifty was up by 91.40 points or 0.52% to
17,622.25.
The US markets settled in green
in a volatile trading session on Monday as traders picked up stocks at reduced
levels following recent weakness. The subsequently rebound by the major
averages came after they pulled back near the two-month intraday lows set last
Friday. Traders largely shrugged off a report from the National Association of
Home Builders showing US homebuilder confidence declined for the ninth
consecutive month in September. The report showed the NAHB/Wells Fargo Housing
Market Index slid to 46 in September from 49 in August. Street had expected the
index to edge down to 48. With the bigger than expected decrease, the housing
market index dropped to its lowest level since hitting 45 in May 2014. However,
trading activity remained somewhat subdued ahead of the Federal Reserve's
two-day policy meeting slated to kick off Tuesday. The Federal Reserve is
widely expected to announce another 75-basis point hike in interest rates this
Wednesday. A number of other major central banks around the world are also
scheduled to announce their latest monetary policy decisions this week,
including the Bank of England and the Bank of Japan. On the sectoral front,
Airline stocks showed a substantial rebound after falling sharply in the
previous session, with the NYSE Arca Airline Index soaring by 3.0 percent after
ending last Friday's trading at its lowest closing level in well over a month.
Steel stocks also saw significant strength following recent weakness, driving
the NYSE Arca Steel Index up by 2.9 percent. The index ended the previous
session at a nearly two-month closing low.
Crude oil futures ended higher on
Monday amid concerns about supplies. According to private reports, the
Organization of the Petroleum Exporting Countries (OPEC) and allies led by
Russia, known as OPEC+, fell short of its oil production target by 3.583
million barrels per day in August. The group had missed its target in June as
well, falling short by nearly 2.9 million barrels per day. However, a fairly
steady dollar amid possible sharp hikes in interest rates limited oil's upside.
The Federal Reserve is widely expected to announce another 75-basis point hike
in interest rates this Wednesday. Meanwhile, the Bank of England, the Bank of
Japan, The People's Bank of China, and the Swiss National Bank are also
scheduled to announce their rate decisions this week. Benchmark crude oil
futures for October delivery surged $0.62 or 0.7 percent at $85.73 a barrel on
the New York Mercantile Exchange. Brent crude for November delivery rose $0.66
or about 0.73 percent to settle at $92.01 a barrel on London's Intercontinental
Exchange.
Indian rupee ended marginally
lower against the US dollar on Monday, on increased demand for the greenback
from importers and banks. Traders were worried as data from Reserve Bank showed
India Inc's investment in their overseas ventures dropped by 59 per cent on an
annual basis to $1.03 billion in August this year. However, downfall remain
capped as Monthly Economic Report of the Department of Economic Affairs,
Ministry of Finance said India retained its status as an attractive destination
among a set of developed and developing economies, as the 5th largest recipient
of FDI in the April-June quarter. On the global front, dollar held firm near
two-decade highs against other major currencies on Monday, biding its time
ahead of a slew of central bank meetings that include one by the U.S. Federal
Reserve that is likely to deliver another hefty rate hike. Finally, the rupee
ended at 79.81 (Provisional), weaker by 3 paisa from its previous close of
79.78 on Friday.
The FIIs as per Monday's data
were net sellers in equity and net buyers in debt segment. In equity segment,
the gross buying was of Rs 20816.48 crore against gross selling of Rs 24293.21
crore, while in the debt segment, the gross purchase was of Rs 6194.66 crore
against gross selling of Rs 299.81 crore. Besides, in the hybrid segment, the
gross buying was of Rs 618.44 crore against gross selling of Rs 52.04 crore.
The US markets ended higher on
Monday thanks to a technical rebound and bargain-hunting after last week's
nightmarish run. Asian markets are trading in green on Tuesday following
overnight gains on Wall Street. Indian markets closed higher on Monday after
losing almost three percent of their value in the past three sessions, aided by
gains in financial, FMCG and IT stocks though losses in metal shares played
spoilsport. Today, markets are likely to get optimistic start tailing strength
in global peers. Investors awaited the outcome of a two-day FOMC meeting due to
begin later in the day, wherein the Fed is widely expected to decide on a 75
basis-point hike in the key lending rates. Foreign fund inflows likely to
support the domestic sentiments. Foreign institutional investors (FIIs) have
net bought shares worth Rs 312.31 crore on September 19, as per provisional
data available on the NSE. Some support will come with a private survey report
indicating that Indian consumers are concerned about rising costs but 71 per
cent of them believe the economy will recover within a year. Traders may take
note of report that capital markets regulator Sebi has put in place a new
framework which will prevent misuse of clients' securities and funds by their
stock brokers. Meanwhile, food secretary Sudhanshu Pandey said the Centre will
soon invite private players along with Food Corporation of India and other
state agencies to procure foodgrains for buffer stock. However, there may be
some cautiousness as India Ratings expects the current account deficit to hit a
36-quarter high of 3.4 per cent of GDP or $28.4 billion in the June quarter,
against a 0.9 per cent surplus a year ago. Some pessimism may come as surplus
liquidity in the banking system as measured by absorption of excess funds by
the Reserve Bank of India (RBI) fell sharply at the end of the last week due to
outflows on account of advance tax payments. According to the RBI data, the net
liquidity absorbed by the central bank on September 16 was at Rs 3,243.57
crore, much lower than the average of Rs 56,809.92 crore in the preceding four
days of the week. There will be some buzz in sugar industry stocks as Food
Secretary Sudhanshu Pandey said the government will soon announce export quota
of sugar for next marketing year starting October. Banking stocks will be in
focus as India Ratings has revised credit growth estimate for FY23 to 13 per
cent from 10 per cent due to factors like uptick in working capital demand,
while maintaining a stable outlook on banks. There will be some reaction in oil
industry stocks as the oil ministry sought a review of the two-and-a-half-month
old windfall profit tax on domestically produced crude oil saying it goes against
the principle of fiscal stability provided in contracts for finding and
producing oil. Besides, government data showed India's crude oil imports fell
more than 13% in August month-on-month, as monsoon rains restricted activity
and slowed consumption in the world's third-biggest oil consumer.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,622.25
|
17,478.90
|
17,716.40
|
BSE
Sensex
|
59,141.23
|
58,660.15
|
59,449.94
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Steel
|
511.46
|
103.20
|
102.06
|
105.26
|
Oil & Natural Gas Corporation
|
194.11
|
131.05
|
129.05
|
133.70
|
Tata Motors
|
152.36
|
425.50
|
422.50
|
430.05
|
ITC
|
143.65
|
335.60
|
330.84
|
338.64
|
NTPC
|
133.04
|
171.20
|
169.80
|
173.35
|
ONGC has sought the government to scrap windfall profit tax levied on domestically produced crude oil and instead use the dividend route to tap into bumper earnings resulting from surge in global energy prices.
SBI and SBI Global Factors have entered into an agreement with SIDBI, Union Bank of India and Bank of Maharashtra, to purchase Equity Shares of SBIGFL held with these three banks.
HDFC Life Insurance Company has received approval from The National Company Law Tribunal for merger of Exide Life Insurance with itself.
M&M's wholly owned subsidiary -- MHL, MSPL and Ontario (2OL) have entered into a Share Purchase agreement and Shareholders' agreement to sell 30% of paid up equity share capital of MSPL by MHL to 2OL.