Indian equity benchmarks stayed
on the back foot for the second straight session on Monday due to selling in
Auto, Basic Materials and Utilities stocks. After the flat start, markets
oscillated in a narrow range as traders were cautious with S&P Global
Ratings stating that the hike in risk weights for consumer loans like personal
loan and credit cards may shave-off tier I capital of banks by 60 basis points,
hit loan growth, and squeeze the nonbank sector in particular. S&P Global
Ratings credit analyst Geeta Chugh said the finance companies will be worse
affected as their incremental bank borrowing costs will surge, in addition to
the capital adequacy impact. Some concern also came with exchange data showing
that Foreign Institutional Investors (FIIs) offloaded equities worth Rs 477.76
crore on Friday. Markets added losses in late morning deals, as sentiments
remained down-beat with the Reserve Bank's statement that India's forex kitty
decreased by $462 million to $590.321 billion for the week ended November 10.
In the previous reporting week, the overall reserves had increased by $4.672
billion to $590.783 billion. Investors continued to trade with caution amid
uncertainty over the ongoing West Asia conflict and global economic slowdown
concerns. However, in last hours of trade, losses remained capped as traders
took some support with Additional Secretary and DGFT Director General Santosh
Kumar Sarangi's statement that Indian e-commerce exports are likely to touch
$200 billion in the next 6-7 years and will play a critical role in achieving
the $2 trillion goods and services export target. Some support also came as
Chief Economic Advisor (CEA) to the Union government V Anantha Nageswaran
stated that startups will play an important role in helping India become the
third largest economy in the world. Finally, the BSE Sensex fell 139.58 points
or 0.21% to 65,655.15 and the CNX Nifty was down by 37.80 points or 0.19% to
19,694.00.
The US markets ended higher on
Monday as treasuries yields pulled back following the release of the results of
the Treasury Department's auction of $16 billion worth of twenty-year bonds.
Further, the strength on markets partly reflected recent upward momentum, which
comes amid ongoing optimism about the outlook for interest rates. Recent data
showing signs of easing inflation has reinforced investor expectations that the
Federal Reserve will leave rates unchanged at upcoming meetings. Potentially
shedding additional light on the outlook for rates, the Fed is due to release
the minutes of its latest monetary policy meeting on Tuesday. On the sectoral
front, tobacco stocks showed a substantial move to the upside on the day, with
the NYSE Arca Tobacco Index soaring by 4.2 percent to its best closing level in
well over three months. Significant strength also emerged among software
stocks, as reflected by the 1.8 percent gain posted by the Dow Jones U.S.
Software Index. Airline stocks also saw considerable strength, driving the NYSE
Arca Airline Index up by 1.6 percent to a two-month closing high. On the
economic data front, the Conference Board released a report showing its reading
on leading U.S. economic indicators fell by more than expected in the month of
October. The report said the leading economic index slid by 0.8 percent in
October after falling by 0.7 percent in September. Street had expected the
index to decrease by 0.6 percent. The bigger than expected drop by the index
reflected deteriorating consumers' expectations for business conditions, lower
ISM Index of New Orders, falling equities, and tighter credit conditions.
Crude oil futures ended higher
with gain of over two percent on Monday on expectations the Organization of the
Petroleum Exporting Countries and allies, collectively known as OPEC+ will
decide to further extend their voluntary output cuts when they meet next week.
The said cuts include additional voluntary reduction announced by Russia and
Saudi Arabia. Further, the dollar's weakness contributed as well to the jump in
oil prices. Benchmark crude oil futures for December delivery rose $1.79 or
about 2.4 percent to settle at $77.83 a barrel on the New York Mercantile
Exchange. Brent crude for January delivery surged $1.85 or nearly 2.30 percent
to settle at $82.32 a barrel on London's Intercontinental Exchange.
Indian rupee ended lower on
Monday tracking a negative trend in domestic equities. Foreign fund outflows
also weighed on the local unit. Traders were worried as Reserve Bank said
India's forex kitty decreased by $462 million to $590.321 billion for the week
ended November 10. In the previous reporting week, the overall reserves had
increased by $4.672 billion to $590.783 billion. Meanwhile, S&P Global
Ratings said the hike in risk weights for consumer loans like personal loan and
credit cards may shave-off tier I capital of banks by 60 basis points, hit loan
growth, and squeeze the nonbank sector in particular. On the global front,
dollar slid to a more than two-month low on Monday, extending a downtrend from
last week as traders reaffirmed their belief that U.S. rates have peaked and
turned their attention to when the Federal Reserve could begin cutting rates. Finally,
the rupee ended at 83.37 (Provisional), weaker by 11 paise from its previous
close of 83.26 on Friday.
The FIIs as per Monday's data
were net sellers in both equity and debt segments. In equity segment, the gross
buying was of Rs 11600.26 crore against gross selling of Rs 11973.00 crore,
while in the debt segment, the gross purchase was of Rs 933.11 crore with gross
sales of Rs 1107.05 crore. Besides, in the hybrid segment, the gross buying was
of Rs 17.89 crore against gross selling of Rs 21.67 crore.
The US markets ended higher on
Monday amid ongoing optimism about the outlook for interest rates. Asian
markets are trading mostly in green on Tuesday following overnight gains on
Wall Street after a tech-fueled rally. Indian markets ended slightly lower on
Monday, marking the second consecutive day of fall, amid weakness in the autos,
metal and FMCG space. Today, markets are likely to get positive start tracking
cues from the global peers. A dip in US Treasury yields may aid domestic
sentiments. Some support will come with a private report that India Inc's net
profit as a percentage of the country's gross domestic product (GDP) is just
shy of reaching 5 per cent, bolstered by strong earnings growth in the second
quarter of 2023-24. Traders may take note of Moody's Investors Service's
statement that the RBI's decision to tighten norms for unsecured personal loans
is credit positive because lenders will need to allocate higher capital for
such loans, thus improving their loss-absorbing buffers. However, foreign fund
outflows may dampen sentiments. Provisional data from the National Stock
Exchange showed that foreign institutional investors net sold shares worth Rs
645.72 crore on November 20. Besides, retail inflation for agricultural
labourers and rural workers rose marginally to 7.08 per cent and 6.92 per cent
in October, respectively, from 6.70 per cent and 6.55 per cent respectively in
September 2023 due to higher prices of certain food items. There may be some
cautiousness with a private report that India's real GDP growth will decline
marginally to 6.3 per cent in 2024 from the 6.4 per cent estimated for 2023.
Traders may be concerned as fresh formal job creation cooled for the second
consecutive month to decline to a six-month low in September, signalling a
downturn in the labour markets this financial year. The latest payroll data
released by the Employees' Provident Fund Organisation (EPFO) showed that the
number of new monthly subscribers under the Employees' Provident Fund (EPF)
declined by 6.45 per cent to 891,583 in September from 953,092 in August.
Meanwhile, SEBI chairperson Madhabi Puri Buch has said she is confused and surprised at investor interest in Futures and Options (F&O) despite 90 per cent of
individuals losing money in the segment. Stocks related to gold may remain in
focus as India's October gold imports surged 60% from a year earlier to a
31-month high as a drop in prices ahead of a key festival prompted jewellers to
ramp up purchases. In primary market, The IPO of Indian Renewable Energy
Development Agency (IREDA) is set to open on November 21.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
19,694.00
|
19,657.51
|
19,743.46
|
BSE
Sensex
|
65,655.15
|
65,520.63
|
65,816.84
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Coal
India
|
190.33
|
348.25
|
344.00
|
352.45
|
Tata
Steel
|
187.80
|
124.25
|
123.65
|
125.25
|
State
Bank of India
|
127.15
|
563.50
|
560.46
|
566.66
|
Power
Grid
|
111.57
|
209.50
|
208.50
|
210.85
|
ICICI
Bank
|
105.62
|
920.95
|
916.71
|
925.96
|
- Larsen & Toubro's Hydrocarbon
Business -- L&T Energy Hydrocarbon has received a Letter of Intent for mega
Offshore order from a prestigious client in the Middle East.
- TCS has signed an agreement with
Australia's primary securities exchange, ASX, to provide a next generation
clearing and settlement platform to service the Australian market.
- Maruti Suzuki India has received
shareholders' approval to issue shares on a preferential basis to SMC as
consideration for a related party transaction for the acquisition of 100% stake
in Suzuki Motor Gujarat.
- Cipla has received a warning
letter from USFDA for the routine current Good Manufacturing Practices
inspection conducted at its Pithampur manufacturing facility between February
6th -17th, 2023.