Indian equity
benchmarks were traded in lackluster mood and ended with losses on Monday
dragged down by losses in index heavyweights SBI, Reliance Industries, Mahindra
& Mahindra amid a largely subdued trend in global markets. Indian markets
started the day marginally in red, as fears of a third wave and the spread of
Delta and Delta plus variant dampened sentiments in markets. However, markets
traded flat with a positive bias in morning deals as Commerce and Industry
Minister Piyush Goyal expressed confidence that India will continue to attract
high foreign direct investment (FDIs) in the current financial year. Traders
took some support as ICRA Ratings in its latest report stated that the
government is set to exceed the budgeted tax collection target of Rs 22.2 lakh
crore for 2021-22, led by indirect taxes, primarily taxes on petroleum
products. Some support also came as investments in the Indian capital markets
through participatory notes (P-notes) rose to Rs 92,261 crore till the end of
June, making it the highest level in 37 months. This also marks the third
consecutive monthly growth. But, markets erased gains and continued their
lackluster trade in afternoon session, as traders were worried with report by
Omidyar Network India and Crisil stating that the second COVID-19 wave has
intensified pressure points for small and mini NBFCs, as they did not get the
benefit of the RBI's liquidity measures announced last year. Some concern also came with reports that
foreign portfolio investors (FPIs) offloaded Indian equities to the tune of
over Rs 5,689 crore in July so far as they continued to adopt a cautious stance
in view of various domestic and global factors. During July 1-23, FPIs took out
Rs 5,689.23 crore from equities, as per depositories data. Meanwhile, the
provisional commerce ministry data showed that the country's exports grew 45.13
per cent to $22.48 billion during July 1-21 on account of healthy growth in
sectors such as gems and jewellery, petroleum and engineering. Imports also
rose 64.82 per cent to $31.77 billion in the said period, leaving a trade
deficit of $9.29 billion. Finally, the BSE Sensex fell 123.53 points or 0.23%
to 52,852.27, while the CNX Nifty was down by 31.60 points or 0.20% to
15,824.45.
The US markets ended marginally
higher on Monday on upbeat earnings reports contributed to rebound along with
continued optimism about the economy despite some concerns about the spread of
new coronavirus variants. However, the choppy trading seen for most of the day
came as traders took a breather following the substantial rebound seen over the
course of the previous week. Traders have been reluctant to make significant
moves ahead of the Federal Reserve's monetary policy announcement on Wednesday.
The Fed is expected to leave interest rates unchanged, but traders will be
paying close attention to any comments regarding the central bank's asset
purchase program. On the economic data front, new home sales in the US
unexpectedly showed another steep drop in the month of June, according to a
report released by the Commerce Department. The report said new home sales
tumbled by 6.6 percent to an annual rate of 676,000 in June after plunging by
7.8 percent to a revised rate of 724,000 in May. The continued nosedive surprised
participants, who had expected new home sales to jump by 4.0 percent to an
annual rate of 800,000 from the 769,000 originally reported for the previous
month. With the unexpected decrease, new home sales slumped to their lowest
annual rate since hitting 582,000 in April of last year. The drop in new home
sales in June was led by the Northeast, where new home sales plummeted by 27.9
percent during the month.
Crude oil futures suffered their
first loss in five sessions on Monday as traders weighed prospects for demand
amid the spread of the delta variant of the coronavirus that causes COVID-19.
In coronavirus news, Russia's total virus cases surpassed 6 million and Turkey
said cases in the country tripled on Sunday compared with earlier this month.
The world's largest crude importer China reported 76 new COVID-19 cases on
Sunday, the highest since the end of January amid a surge of local infections
in the eastern city of Nanjing. Crude oil futures for September fell $0.16 or
0.2 percent to settle $71.91 barrel on the New York Mercantile Exchange.
However September Brent crude surged $0. 40 or 0.5 percent to settle at $74.50
a barrel on London's Intercontinental Exchange.
Indian rupee ended weaker against
the US dollar on Monday, on increased demand for the greenback from importers
and banks. Traders were concerned as foreign portfolio investors (FPIs)
offloaded Indian equities to the tune of over Rs 5,689 crore in July so far as
they continued to adopt a cautious stance in view of various domestic and
global factors. During July 1-23, FPIs took out Rs 5,689.23 crore from
equities, as per depositories data. However, downfall remained capped as Industry
Minister Piyush Goyal expressed confidence that India will continue to attract
high foreign direct investment (FDIs) in the current financial year. On the
global front, dollar slipped against a basket of currencies on Monday as
investor focus turned to this week's Federal Reserve meeting. Finally, the
rupee ended 74.42, weaker by 2 paise from its previous close of 74.40 on
Friday.
The FIIs as per Monday's data
were net sellers in equity segment, while net buyers in debt segment. In equity
segment, the gross buying was of Rs 7647.86 crore against gross selling of Rs
7862.97 crore, while in the debt segment, the gross purchase was of Rs 664.93
crore with gross sales of Rs 425.13 crore. Besides, in the hybrid segment, the
gross buying was of Rs 1.37 crore against gross selling of Rs 12.03 crore.
The US markets ended higher in
choppy trade on Monday as investors avoided making new, bold bets before this
week's Federal Reserve policy meeting, which might offer clues on the outlook
for monetary policy. Asian markets are trading mostly in green on Tuesday with
traders keeping at least half an eye on the United States where major companies
report earnings and the Federal Reserve meets on policy this week. Indian
markets ended lower Monday dragged by selling in financials and auto stocks.
Today, markets are likely to open in green following positive global cues.
Traders will be taking encouragement with Care Ratings' report that the
country's gross domestic product (GDP) growth is likely to be 8.8 to 9 per cent
in the current financial year, driven by agriculture and industry sectors. The
country's economy had contracted by 7.3 per cent in fiscal 2020-21. Some
support will come as the government's total tax collection in the April-June
quarter grew about 86 per cent to more than Rs 5.57 lakh crore. Out of the
total amount, collection of net direct tax stood at Rs 2.46 lakh crore and of
indirect tax was at Rs 3.11 lakh crore. However, there may be some concern as
Moody's Analytics said the second wave of COVID-19 may have a more lasting
damage on the Indian economy and exports will once again be the foundation for
recovery. In its report titled 'APAC Economic Outlook: The Delta Roadblock',
Moody's Analytics said social distancing is weighing on the current quarter,
but economic recovery will resume by the year-end. There will be some buzz in
the banking stocks as Minister of State for Finance Bhagwat K Karad said
non-performing assets (NPAs) or bad loans of banks have declined by Rs 61,180
crore to Rs 8.34 lakh crore at the end of March 31, 2021, as result of various
steps taken by the government. There will be some reaction in real estate
stocks with a private report stating that around $18 billion loans of the
overall lending to the real estate sector by banks, NBFCs and housing finance
companies (HFCs) are under severe stress. Glenmark Life Sciences' Rs 1,514
crore initial public offering (IPO) opens for subscription on Tuesday, July 27.
The issue consists of a fresh issue of equity shares worth Rs 1,060 crore and
an offer for sale by existing shareholders worth R 453 crore. Investors can bid
for Glenmark Life Sciences IPO at the fixed price band of Rs 695-720 per
share in a bid lot of 20 shares. There will be some important earnings
announcements too to keep the markets buzzing.
Support and Resistance:
NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
15,824.45
|
15,783.19
|
15,879.54
|
BSE
Sensex
|
52,852.27
|
52,722.80
|
53,042.59
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
ITC
|
472.63
|
211.15
|
209.51
|
214.06
|
ICICI Bank
|
310.54
|
676.75
|
664.31
|
688.46
|
Tata Motors
|
275.02
|
293.15
|
290.44
|
296.44
|
JSW Steel
|
146.45
|
704.55
|
693.86
|
722.36
|
State Bank of India
|
140.37
|
423.30
|
421.14
|
426.64
|
IndusInd Bank is planning to raise up to Rs 30,000 crore or its equivalent amount in such foreign currencies as may be necessary.
Cipla is recalling 7,228 bottles of Solifenacin Succinate tablets, a medicine used to treat overactive bladder, in the US market due to manufacturing issues.
Sun Pharmaceutical Industries includes its subsidiaries and Cassiopea SpA have signed license and supply agreements for Winlevi (clascoterone cream 1%) in the United States and Canada.
State Bank of India has opened a branch at President's Estate.