Extending the
winning momentum for second successive session, Indian equity benchmarks surged
more than 2 percent each in Tuesday's session on the back of a broad-based
buying frenzy, due to positive cues from the global markets. Nifty ended just
shy of its crucial 14,850 mark, while Sensex regained its psychological level
of 50,100. After opening in the green, benchmark indices maintained their lead
for the whole day. Sentiments got a boost as US Trade Representative Katherine
Tai, after meeting Union Minister of Commerce and Industry Piyush Goyal, said
India and the United States will look at ways to expand its trade relations and
cooperate on pending bilateral issues. Furthermore, investors' morale also
remained upbeat as Chief Economic Adviser (CEA) K. V. Subramanian asserted that
the disinvestment target of Rs 1.75 lakh crore for 2021-22 was eminently
achievable. He said the proposed initial public offering (IPO) by LIC itself
could garner Rs 1 lakh crore for the government. He also said targeting of
retail inflation by the Reserve Bank of India (RBI) has helped bring down the
volatility and level of inflation. Market participants also got some
encouragement as Union Minister Piyush Goyal has said that India will be able
to overtake China in its engagement with Bangladesh. He said India has been
working relentlessly to build strong relations with all its neighbouring
countries. He also said India's ability to add more value to the products and services
has helped it expand trade ties with countries like Bangladesh. Meanwhile, the
government is unlikely to take zero-coupon bond route to further recapitalise
public sector banks after the Reserve Bank expressed some concerns in this
regard. The government would resort back to recapitalisation bonds bearing a
coupon rate for capital infusion in these banks. Finally, the BSE Sensex rose
1128.08 points or 2.30% to 50,136.58, while the CNX Nifty was up by 337.80
points or 2.33% to 14,845.10.
The US markets
ended lower on Tuesday as treasury yields extended the strong upward move seen
on Monday, weighing on high-growth technology stocks. The yield on the
benchmark ten-year note climbed to its highest level in over a year amid
optimism about the coronavirus vaccine rollouts and the economy reopening as
well as President Joe Biden's soon to be announced infrastructure plan.
President Joe Biden is expected to provide details about his infrastructure
plan when he travels to Pittsburgh on Wednesday. The spending package could
cost north of $3 trillion. On the economic data front, Consumer confidence in
the US skyrocketed by much more than anticipated in the month of March,
according to a report released by the Conference Board. The Conference Board
said its consumer confidence index spiked to 109.7 in March from a downwardly
revised 90.4 in February. Street had expected the consumer confidence index to
climb to 96.0 from the 91.3 originally reported for the previous month. With
the much bigger than expected increase, the consumer confidence index reached
its highest level since the onset of the coronavirus pandemic in March of 2020.
Crude oil futures ended lower on
Tuesday as concerns about likely disruptions eased after shipping traffic
resumed through the Suez Canal. Traders were also weighing the possible impact
of a surge in coronavirus cases and extended lockdown measures in Europe on
near-term energy demand. Meanwhile, Traders were looking ahead to the outcome
of the upcoming meeting of the Organization of the Petroleum Exporting
Countries and their allies. The oil cartel is expected to take call on
production cuts during the meeting. Crude oil futures for May fell $1.01 or 1.6
percent to settle at $60.55 barrel on the New York Mercantile Exchange. May
Brent crude declined $0.91 or 1.4 percent to settle at $64.01 a barrel on
London's Intercontinental Exchange.
Indian rupee concluded
substantially weaker against U.S. dollar on Tuesday on account of sustained
dollar demand from importers and banks. Traders shrugged off report that US
Trade Representative Katherine Tai, after meeting Union Minister of Commerce
and Industry Piyush Goyal, said India and the United States will look at ways
to expand its trade relations and cooperate on pending bilateral issues.
Meanwhile, amid uncertainty created by a surge in coronavirus cases, the
Reserve Bank of India (RBI) is likely to maintain the status quo at its next
monetary policy review and wait for some more time before taking any action to
spur growth. On the global front, dollar gained against major currencies on
Tuesday and climbed to a one-year high against the yen, as accelerating U.S.
vaccinations and plans for a major stimulus package stoked inflation
expectations and Treasury yields. Finally, the rupee ended 73.38, weaker by 87
paise from its previous close of 72.51 on Friday.
The FIIs as per Tuesday's data
were net buyer in both equity and debt segment. In equity segment, the gross
buying was of Rs 7003.36 crore against gross selling of Rs 6608.35 crore, while
in the debt segment, the gross purchase was of Rs 1877.79 crore against gross
selling of Rs 1016.68 crore. Besides, in the hybrid segment, the gross buying
was of Rs 16.84 crore against gross selling of Rs 29.42 crore.
The US markets ended lower on
Tuesday as yields weighed on tech shares, financial stocks rose, their gains
helped by signs the fallout from the Archegos meltdown would be relatively
contained. Asian markets are trading mostly in red on Wednesday as global
financial shares retraced some of their recent losses, driven in part by higher
bond yields. Indian markets ended over 2 percent higher on Tuesday, rising for
the second straight session boosted mainly by IT, metal and financial stocks.
Today, the markets are likely to make negative start on last trading session of
financial year 2020-21 (FY21), tracking weakness in global markets. Rising
coronavirus cases also likely to weight down on the domestic indices. India has
recorded 53,158 cases recorded in the last 24 hours. With the latest addition,
the country's tally has soared to 12,148,487, Worldometer showed this morning.
With active cases hitting 553,933, India is now the 6th-worst hit country. The
death toll from the deadly infection jumped to 162,502. Traders will be
concerned as a report by the United Nations Economic and Social Commission for
Asia and the Pacific (UNESCAP) stated that India's economic output in 2021 is
expected to remain below the 2019 level despite roll-out of the vaccine to deal
with the menace of the coronavirus pandemic. There will be some cautiousness
with Moody's Analytics' statement that India's inflation is at uncomfortably
high level, which is an exception among Asian economies. It said higher fuel
prices will keep upward pressure on retail inflation and keep the RBI from
offering further rate cuts. However, some support may come later in the day as
Union Finance Minister Nirmala Sitharaman said India's quick response in
limiting the impact of the COVID-19 pandemic and undertaking massive
vaccination drives are resulting in a V-shaped recovery. Some optimism may come
as the government is expected to further extend the existing foreign trade
policy (FTP), which is scheduled to lapse from April 1 this year, for few more
months. FTP provide guidelines for enhancing exports to push economic growth
and create jobs. Besides, the foreign institutional investors (FIIs) turned net
buyer in both equity and debt market on Wednesday. The net investment of equity
and debt reported were Rs 395.01 crore and Rs 861.11 crore. Meanwhile, the
central government has released Rs 30,000 crore as goods and service tax (GST)
compensation to states for FY21. Sugar sector stocks will be in focus with a
report that the government has decided not to extend soft loans for at least a
year to sugar mills for capacity expansion under the Sugar Development Fund
(SDF), which offers financing at 2 percentage points below the prevailing bank
rate.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
14,845.10
|
14,683.04
|
14,941.74
|
BSE
Sensex
|
50,136.58
|
49,556.03
|
50,492.80
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Gail
India
|
718.58
|
132.35
|
129.69
|
136.14
|
Tata
Motors
|
452.57
|
297.05
|
292.74
|
301.34
|
State
Bank of India
|
394.07
|
360.80
|
356.64
|
364.64
|
NTPC
|
361.30
|
107.70
|
105.30
|
109.40
|
Oil
& Natural Gas Corporation
|
318.43
|
103.50
|
101.96
|
105.66
|
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