Indian equity
benchmarks ended the session on a negative note for the third consecutive
session on Thursday amid downbeat global sentiment and heightened fears in
anticipation of interest rate hikes by the US Federal Reserve. Markets started
the session in red as traders got anxious with rating agency Icra's statement
that while there is some evidence of the economic recovery becoming broad-based
in the third quarter of fiscal 2022, it is yet to attain the durability being
sought by the Monetary Policy Committee (MPC) as a precursor to policy
transmission. The agency expects the real GDP to expand 6-6.5 per cent
year-on-year in the third quarter of FY2022 (+8.4 per cent in Q2 FY2022. Some
cautiousness also came with the UN Conference on Trade and Development (UNCTAD)
in its latest report stated that Foreign Direct Investment (FDI) flows to India
in 2021 were 26 percent lower, mainly because large M&A deals recorded in
2020 were not repeated. It also said that the second wave of the COVID-19
outbreak in India weighed heavily on the country's overall economic activities.
Key indices extended fall in afternoon deals, even as India Ratings &
Research expects India's real gross domestic product to grow 7.6 per cent in
fiscal year 2022-23, helped partly by a continued government spending and
favourable global trade outlook. However, a rebound in the final hour trimmed
some losses as some support came with the Reserve Bank of India's (RBI) digital
payments index (DPI), which was launched in January 2021 to indicate the extent
of digitisation of payments across the country, shows that the index for
September 2021 stood at 304.06 against 270.59 in March. This indicates the
rapid adoption and deepening of digital payments across the country. Traders
took note of report that India will push for a waiver of certain provisions of
the global intellectual property rights agreement for Covid-19 medicines and
products at a mini ministerial meeting called by the World Trade Organization
to firm up its pandemic response. Finally, the BSE Sensex fell 634.20 points or
1.06% to 59,464.62 and the CNX Nifty was down by 181.40 points or 1.01% to
17,757.00.
The US markets ended lower on
Thursday, giving up their sharp gains from earlier in the session, as markets
continues to struggle this year in a rising interest rate environment. Stocks
moved lower as government bond yields remained elevated, part of a market
repricing as the Federal Reserve gets set to tighten monetary policy. The
central bank meets next week, with markets indicating just a slight chance of
action on interest rates. However, traders have fully priced in the first of
what is expected to be four 0.25 percentage point hikes through 2022. The
two-year Treasury, which is most closely tied to Fed rate policy, most recently
yielded about 1.04%, while the benchmark 10-year note touched a high of 1.87%. Meanwhile,
several earnings reports moved stocks on Thursday. Dow component Travelers
posted beats on the top and bottom lines while American Airlines also beat
street's estimates but lowered guidance. Travelers rose 3.2%, while American
Airlines fell 3.2%. United Airlines shares fell 3.4% after the company reported
its quarterly results and warned that omicron has dented bookings and will
delay its pandemic recovery. On the economic data front, Unemployment data
signaled the surge in omicron could be hurting the recovery. Jobless claims for
the week ended January 15 totaled 286,000 for the week, their highest level since
October.
Crude oil futures ended lower on
Thursday as investors took profits after a recent price rally, and industry
data showed US crude and gasoline stocks rose last week. Crude stocks rose by
1.4 million barrels for the week ended January 14 while gasoline inventories
rose by 3.5 million barrels, according to the American Petroleum Institute.
However, distillate stocks fell by 1.2 million barrels, after last week's 3.035
million barrel increase. Benchmark crude oil futures for February delivery fell
$0.67 or 0.77 percent to settle at $86.29 a barrel on the New York Mercantile
Exchange. Brent crude for March delivery lost $0.06 or to settle at $88.38 a
barrel on London's Intercontinental Exchange.
Indian rupee ended weaker against
the US dollar on Thursday amid heightened fears in anticipation of interest
rate hikes by the US Federal Reserve. Traders also got anxious with rating
agency Icra's statement that while there is some evidence of the economic
recovery becoming broad-based in the third quarter of fiscal 2022, it is yet to
attain the durability being sought by the Monetary Policy Committee (MPC) as a
precursor to policy transmission. The agency expects the real GDP to expand
6-6.5 per cent year-on-year in the third quarter of FY2022 (+8.4 per cent in Q2
FY2022. Some cautiousness also came with the UNCTAD in its latest report stated
that FDI flows to India in 2021 were 26 percent lower, mainly because large
M&A deals recorded in 2020 were not repeated. On the global front, Sterling
held close to a 23-month high against the euro and rose versus a weakening
dollar on Thursday, still supported by expectations of UK interest rate rises.
Finally, the rupee ended 74.51 (Provisional), weaker by 7 paise from its
previous close of 74.44 on Wednesday.
The FIIs as per Thursday's data
were net sellers in equity segment, while net buyers in debt segment. In equity
segment, the gross buying was of Rs 7635.40 crore against gross selling of Rs
10273.89 crore, while in the debt segment, the gross purchase was of Rs 578.04
crore with gross sales of Rs 414.72 crore. Besides, in the hybrid segment, the
gross buying was of Rs 22.01 crore against gross selling of Rs 26.28 crore.
The US markets ended lower on
Thursday amid fears of a tighter monetary policy. Asian markets are trading in
red on Friday tracking overnight losses on Wall Street, amid concerns about an
earlier-than-expected tightening of monetary policy and the pace of economic
recovery in the US due to the Omicron variant of COVID-19. Indian markets
finished a choppy session sharply lower on Thursday, extending losses to a
third straight day, dragged by IT, financial and oil & gas stocks. Today,
the markets are likely to make gap-down opening amid weak global cues and
persistent selling by FIIs. There will be some cautiousness as the government
data showed that retail inflation for farm and rural workers rose to 4.78
percent and 5.03 percent respectively in December 2021, mainly due to higher
price of certain food items. However, some respite may come later in the day as
India Ratings and Research said the country's economy is likely to grow at 7.6
per cent year-on-year in 2022-23. The agency said after a gap of two years, the
Indian economy will show a meaningful expansion, as the real GDP in 2022-23 is
expected to be 9.1 per cent higher than that in 2019-20 (pre-COVID level). Some
support may come as the payroll data of the Employees' Provident Fund
Organization (EPFO) showed at least 8,27, 979 people joined formal work for the
first time in November, showing a marginal uptick in the formal sector job
creation over the month-ago period. Meanwhile, in a bid to spur capital
expenditure, the Finance Ministry has relaxed spending norms for the fourth
quarter with a view to boost economic activities slowed down due to the impact
of COVID-19. NBFCs stocks will be in focus as domestic rating agency Icra
Ratings revised the asset under management (AUM) growth outlook of retail
non-banking financial companies (NBFCs) to 5-7 per cent for the fiscal 2022
from an earlier expectation of 8-10 per cent.
There will be some reaction in mines and mineral industry stocks as the
mines ministry said India's mineral production rose five per cent in November
2021 compared to the year-ago period. The index of mineral production of mining
and quarrying sector for November 2021 stood at 111.9, which was five per cent
higher compared to the level in November 2020. Today is also the last day to
subscribe to AGS Transact Technologies IPO, which has been subscribed 1.42
times so far. Investors awaited more of quarterly earnings from India Inc for
cues. Reliance Industries is due to report its financial results later in the
day.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,757.00
|
17,622.40
|
17,917.65
|
BSE
Sensex
|
59,464.62
|
59,006.80
|
59,983.97
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Power Grid Corporation of India
|
226.27
|
204.65
|
201.59
|
211.54
|
Tata Motors
|
183.64
|
520.85
|
514.16
|
525.36
|
State Bank of India
|
177.24
|
515.80
|
509.49
|
520.64
|
Coal India
|
174.62
|
163.90
|
274.89
|
286.04
|
ITC
|
173.29
|
220.35
|
218.19
|
222.34
|
Bajaj Finserv has reported fall of 2.65% in its consolidated net profit at Rs 1255.79 crore for Q3FY22 as compared to Rs 1289.96 crore for Q3FY21.
UPL and other shareholders in Sinagro Produtos Agropecuarios SA., Brazil have signed an agreement with Bunge to sell 33% stake in Sinagro.
Asian Paints has reported a fall of 18.49% in its consolidated net profit at Rs 1031.29 crore for Q3FY22 as compared to Rs 1265.35 crore for Q3FY21.
HCL Technologies has expanded its strategic transformation partnership with ams OSRAM to digitize one of the optical solutions leader's key business processes.