Selling which
occurred in late trade mainly dragged Indian equity benchmarks lower on Wednesday.
After a cautious start, markets managed to trade mostly in green terrain for
the day as traders continued to buy beaten down but fundamentally strong
stocks. Sentiments remained upbeat after a survey by the National Council of
Applied Economic Research (NCAER) showed that as the second wave of Covid-19
eased off, business sentiment in the country hit an over two-year high in the
September quarter (Q2) of the current financial year (FY22). Adding optimism,
Finance Minister Nirmala Sitharaman said the government's social protection and
economic stimulus packages, along with timely structural reforms in various
sectors, have been pivotal in India's economic recovery process. Meanwhile, the
government is planning to come up with a semiconductor design-linked incentive
policy to promote domestic manufacturing as well as attract global electronic
chip companies to the country. However, traders booked profit in last leg of
trade which mainly dragged key gauges lower. Traders turned anxious after
Chairman of the 15th Finance Commission -- N K Singh has said the International
Monetary Fund's (IMF's) decision to revise India's potential growth forecast
downwards to 6 per cent citing the coronavirus pandemic is a gross under
estimation and observed that calculations of growth potential are always
problematic. He mentioned the issue of our medium term growth potential
projected by the IMF last week by recaliberating it from 6.25 per cent to 6 per
cent, in my view, is gross under estimation. Finally, the BSE Sensex declined
206.93 points or 0.34% to 61,143.33 and the CNX Nifty was down by 57.45 points
or 0.31% to 18,210.95.
The US markets ended mostly lower
on Wednesday as traders looked to cash in on recent strength in the markets.
Some weakness also prevailed in the markets as the momentum from a strong
earnings season started to fade. Shares of Twitter (TWTR) moved sharply lower
on the day after the social media reported third quarter earnings that beat
estimates but weaker than expected user growth. Auto giant General Motors (GM)
also came under pressure after reporting third quarter earnings and revenues
that fell year-over-year. On the sectoral front, banking stocks showed a
significant move to the downside on the day, with the KBW Bank Index slumping
by 2.6 percent. The index continued to give back ground after reaching a record
intraday high on Monday. Considerable weakness also emerged among steel stocks,
as reflected by the 3.2 percent nosedive by the NYSE Arca Steel Index. On the
economic data front, the Commerce Department released a report showing durable
goods orders pulled back by much less than expected in the month of September.
The Commerce Department said durable goods orders fell by 0.4 percent in
September after jumping by a downwardly revised 1.3 percent in August. Street
had expected durable goods orders to slump by 1.1 percent compared to the 1.8
percent spike that had been reported for the previous month. Excluding a steep
drop in orders for transportation equipment, durable goods orders climbed by
0.4 percent in September after rising by 0.3 percent in August. The increase
matched street estimates.
Crude oil futures ended lower on
Wednesday after data showed a larger than expected increase in US crude
stockpiles in the week ended October 22nd. Data released by US Energy
Information Administration (EIA) showed crude oil inventories increased by
about 4.3 million barrels last week, more than twice the expected increase of
1.9 million barrels. The American Petroleum Institute said on Tuesday that
crude oil inventories rose 2.3 million barrels in the week ending October 22,
while street had expected a 1.9 million barrel gain. Besides, oil prices were
also weighed down by prospects of Iran freeing itself from US sanctions and
starting to sell oil to major importers again. Benchmark crude oil futures for
December delivery fell $1.99 or about 2.35% to settle at $82.66 a barrel on the
New York Mercantile Exchange. Brent crude for December delivery declined $1.70
or 2.01 percent to settle at $83.95 a barrel on London's Intercontinental
Exchange.
Indian rupee ended stronger
against dollar on Wednesday due to fresh selling of the American currency by
banks and exporters. Traders took support as National Council of Applied
Economic Research (NCAER) showed that as the second wave of Covid-19 eased off,
business sentiment in the country hit an over two-year high in the September
quarter (Q2) of the current financial year (FY22). Meanwhile, Chairman of the
15th Finance Commission -- N K Singh stated that the International Monetary
Fund's (IMF's) decision to revise India's potential growth forecast downwards
to 6 per cent citing the coronavirus pandemic is a gross under estimation and
observed that calculations of growth potential are always problematic. On the
global front, Sterling was little changed on Wednesday ahead of a half-yearly
update on the public finances and economic outlook from British finance
minister Rishi Sunak. Finally, the rupee ended 74.90, stronger by 6 paise from
its previous close of 74.96 on Tuesday.
The FIIs as per Wednesday's data
were net seller in both equity and debt segments. In equity segment, the gross
buying was of Rs 7281.40 crore against gross selling of Rs 9561.79 crore, while
in the debt segment, the gross purchase was of Rs 121.76 crore with gross sales
of Rs 370.06 crore. Besides, in the hybrid segment, the gross buying was of Rs 13.33
crore against gross selling of Rs 43.74 crore.
The US markets ended mostly lower
on Wednesday as traders looked to cash in on recent strength in the markets in
late-day trading. Asian markets are trading mostly in red on Thursday as
investors looked to whether central banks may consider tightening monetary
policies earlier than anticipated. Indian markets snapped a two-day winning
streak in a choppy session on Wednesday, dragged by weakness in financial and
oil & gas shares. However, strength in IT names provided some support.
Today, the start the session is likely to be cautious ahead of expiry of the
October F&O series coupled with the weakness in global markets. Traders may
be concerned with report that cooking gas LPG prices may be hiked next week
after under-recovery on the fuel widened to over Rs 100 per cylinder. There
will be some cautiousness as a report from the Euro-Mediterranean Center on
Climate Change (CMCC) said that in India, the decline in rice and wheat yields
due to climate change could lead to economic losses between 43-81 billion EUR
(or 1.8-3.4% of GDP) by 2050. Besides, foreign institutional investors (FIIs)
net sold shares worth Rs 1913.36 crore, while domestic institutional investors
(DIIs) net bought shares worth Rs 472.48 crore in the Indian equity market on
October 27, as per provisional data available on the NSE. However, some support
may come as the CBDT said refunds of over Rs 1,02,952 crore have been issued to
the taxpayers during the current financial year. The Central Board of Direct
Taxes (CBDT) frames policy for the Income Tax Department. Meanwhile, The
Securities and Exchange Board of India (Sebi) has decided to bring in a
two-tiered structure for benchmarking of certain categories to standardize
benchmarks of mutual fund schemes. Banking sector stocks will be in focus with
a private report that Indian banking sector is set to witness a fresh round of
consolidation over the medium term - spread over FY22-24 period - primarily
driven by large private sector banks. There will be some reaction in energy
stocks as Icra in its report stated that solar energy tariff is likely to go up
by 20-25 paise per unit in upcoming bids for projects as compared with rates
seen over the past six months. This assumes significance in view of India's
ambitious target to achieve 450 GW of renewable energy by 2030. Moreover, four
stocks - Indiabulls Housing Finance, Canara Bank, NMDC and Sun TV Network - are
under the F&O ban for October 28. Meanwhile, Nykaa's initial public
offering (IPO) will open today and Nykaa has priced its IPO at Rs 1,085 to Rs
1,125 per share. The company has raised Rs 2,396 crore from 174 anchor
investors ahead of its IPO. There will be some earnings announcements too to
keep the markets buzzing.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
18,221.40
|
18,167.61
|
18,308.61
|
BSE
Sensex
|
61,143.33
|
60,896.19
|
61,483.65
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Axis
Bank
|
371.26
|
787.10
|
768.24
|
823.39
|
State
Bank of India
|
285.61
|
519.00
|
512.21
|
526.31
|
Tata
Motors
|
281.39
|
498.15
|
494.89
|
503.99
|
ITC
|
244.68
|
238.55
|
236.06
|
241.16
|
ICICI
Bank
|
216.32
|
835.00
|
823.14
|
847.94
|
HDFC and India Post Payments Bank have entered into a strategic alliance to offer home loans to nearly 4.7 crore customers of the payments bank.
Reliance Industries and energy supermajor BP's JV -- Reliance BP Mobility has launched its first Jio-bp branded mobility station at Navde, Navi Mumbai.
Tata Steel has installed new 30-megawatt generator at Tata Steel's Port Talbot site in South Wales.
Axis Bank has reported 84.45% rise in its consolidated net profit at Rs 3,387.70 crore for Q2FY22 as compared to Rs 1,836.66 crore for Q2FY21.