Indian equity benchmarks
witnessed yet another range bound trading session and ended the December series
on a flat note on Thursday, as investors remained cautious amid surging Omicron
cases. The headline indices opened on a quite note but soon slightly inched up
in early morning trade. Traders took some support with private report stated
that employment opportunities in the e-commerce and allied industries witnessed
a 28 per cent surge in 2021, and recruitment activities in this segment will
gain further momentum driven by economic recovery and aggressive vaccination
drive. Some solace also came with the Federation of Indian Export Organisations
(FIEO) stating that the country's exports are expected to register healthy
growth rate in the next financial year (FY23) might touch $530 billion as
exporters are flushed with orders. FIEO further stated that additional exports
will come from some of the PLI (production-linked incentive) sectors in the
next fiscal. Traders also took a note of the Reserve Bank of India's (RBI)
second Financial Stability Report (FSR) stated that the Omicron variant of
coronavirus remains the major challenge along with rising inflation pressures,
though the economy has steadily gained momentum and remained resilient since
the second quarter of the current fiscal. However, key gauges failed to hold
positive momentum and ended flat, as investors remained anxious as authorities
in various parts of India said the third wave of infections has begun. Virus
cases more than doubled in Delhi and Mumbai in a single day, forcing the
governments to enforce more restrictions.
Some concern also came as the Reserve Bank of India (RBI) has flagged
concerns on the deteriorating credit quality in the retail books of lenders and
warned that the retail-led model of selling credit, led by housing loans, is
confronting headwinds now. According to the financial stability report, between
April and the first week of December, credit disbursal grew to 7.1 per cent as
against 5.4 per cent growth a year ago and 5.2 per cent in March 2021.
Meanwhile, the GST Council, chaired by Finance Minister Nirmala Sitharaman,
will meet on December 31 and discuss, among other things, report of the panel of
state ministers on rate rationalisation. Finally, the BSE Sensex fell 12.17
points or 0.02% to 57,794.32 and the CNX Nifty was down by 9.65 points or 0.06%
to 17,203.95.
The US markets settled lower on
Thursday on profit taking after the Dow and the S&P 500 reached new record
intraday highs in early trading. Stocks initially benefited from recent upward
momentum, which has helped the markets largely offset the pullback seen in reaction
to initial reports about the Omicron variant of the coronavirus. With early
indications that the Omicron variant causes milder symptoms, traders seem
optimistic the new strain will not derail the economic recovery. However,
trading activity remained somewhat subdued as some traders looked to get a head
start on New Year's festivities. On the economic data front, the Labor
Department released a report unexpectedly showing a modest drop in first-time
claims for US unemployment benefits in the week ended December 25th. The report
said initial jobless claims dipped to 198,000, a decrease of 8,000 from the
previous week's revised level of 206,000. The slight pullback surprised
participants, who had expected jobless claims to inch up to 208,000 from the 205,000
originally reported for the previous week. A separate report from MNI
Indicators growth in Chicago-area business activity picked back up in the month
of December. MNI Indicators said its Chicago business barometer rose to 63.1 in
December from 61.8 in November, with a reading above 50 indicating growth.
Street had expected the business barometer to inch up to 62.0.
Crude oil futures ended higher on
Thursday, extending the upward trend seen over the past several sessions, on
expectations that fuel demand held up despite soaring Omicron coronavirus
infections and that OPEC and its allies would continue to increase imports only
incrementally. Further supporting sentiment, governments around the world were
trying to limit the impact of record numbers of new Covid-19 infections on
economic growth by easing testing rules and narrowing who needs to isolate as
close contacts of positive cases. Meanwhile, China, the world's biggest oil
importer, reported 207 new confirmed coronavirus cases and 27 new asymptomatic
cases on Thursday, but no new deaths. Australian cases hit a new record of more
than 19,000 daily infections. Benchmark crude oil futures for February delivery
rose $0.43 or 0.6 percent to settle at $76.99 a barrel on the New York
Mercantile Exchange. Brent crude for February delivery surged $0.09 or 0.11
percent to settle at $79.32 a barrel on London's Intercontinental Exchange.
Indian rupee strengthened substantially
against dollar on Thursday as banks and exporters continued to sell the US
currency amid persistent capital inflows. Sentiments were upbeat as Federation
of Indian Export Organisations (FIEO) stated that the country's exports are
expected to register healthy growth rate in the next financial year (FY23)
might touch $530 billion as exporters are flushed with orders. FIEO further
stated that additional exports will come from some of the PLI
(production-linked incentive) sectors in the next fiscal. On the global front,
dollar rose against major rival currencies in holiday-thinned trading on
Thursday, as investors remained cautiously optimistic about the economic
consequences of a surge in cases of the Omicron coronavirus variant. Finally,
the rupee ended 74.42 (Provisional), stronger by 29 paise from its previous
close of 74.71 on Wednesday.
The FIIs as per Thursday's data
were net sellers in both equity and debt segments. In equity segment, the gross
buying was of Rs 3629.23 crore against gross selling of Rs 4375.99 crore, while
in the debt segment, the gross purchase was of Rs 687.39 crore with gross sales
of Rs 948.73 crore. Besides, in the hybrid segment, the gross buying was of Rs 2.03
crore against gross selling of Rs 17.66 crore.
The US markets ended lower on
Thursday retreating late in thin holiday volume from record highs set early in
the session on strong US data, including a drop in weekly claims for US
unemployment benefits. Asian markets are trading in green on Friday amid thin
trade as several regions were closed for the New Year. Indian markets ended
flat on the day of monthly F&O expiry on Thursday amid persisting
volatility. Gains in IT and financial stocks were offset by losses in oil &
gas, auto and metal shares. Today, the markets are likely to make cautious
start on last trading session of calendar year 2021 amid thin trade across
Asia. Traders will be concerned as India's tally of the highly contagious
Omicron variant of coronvirus (COVID-19) on Thursday crossed 1,000 on the back
of Maharashtra reporting its highest single-day infection with the new strain,
as states further tightened measures to deal with the surge in coronavirus
cases. There will be some cautiousness as India Ratings and Research (Ind-Ra)
said higher tax and non-tax revenue collections this fiscal are expected to
more than offset the shortfall in disinvestment revenue, leading to the fiscal
deficit coming in at 6.6 per cent of GDP in FY22, or 20 basis points lower than
the budgeted target. Traders may take note of Food Secretary Sudhansu Pandey's
statement that the government's food subsidy is expected to be a little less
than Rs 4 lakh crore in the financial year 2021-22 as against Rs 5.29 lakh
crore in the previous fiscal. Investor will be eyeing the 46th meeting of the
GST Council chaired by Union Finance Minister Nirmala Sitharaman, to be held
later in the day. This meeting holds importance ahead of the Union Budget which
is presented on the first day of February by the Finance Minister in
Parliament. Meanwhile, Tax authorities have detected goods and services tax
evasion of Rs 40,000 crore in over a year, largely on account of fake invoices
and fraud input tax credit claims. Textile industry stocks will be in focus as
several states flagged higher tax rate on textile products from January 1 and
demanded that the rate hike be put on hold, ahead of the GST Council meeting.
Besides, CMS Info Systems shares were scheduled to list on BSE and NSE on
December 31, 2021. The Rs 1,100 crore CMS Info Systems IPO is purely an offer
for sale (OFS) by promoter Sion Investment Holdings, an affiliate of Baring
Private Equity Asia; and was subscribed 1.95 times from December 21-23, 2021.
Support and Resistance: NSE (Nifty) and BSE
(Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
17,203.95
|
17,145.51
|
17,263.21
|
BSE Sensex
|
57,794.32
|
57,578.87
|
58,009.91
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Power
Grid Corporation of India
|
656.10
|
204.05
|
200.00
|
209.75
|
NTPC
|
323.94
|
126.45
|
123.19
|
128.79
|
State
Bank of India
|
288.79
|
453.05
|
449.40
|
455.80
|
Coal
India
|
247.82
|
146.05
|
143.64
|
148.74
|
ICICI
Bank
|
143.26
|
736.00
|
729.84
|
741.34
|
HCL Technologies' wholly owned step-down subsidiary -- HCL America Inc., has acquired the balance 19.6% stake in HCL Technologies SEP Holdings Inc.
Reliance Industries is planning to raise funds through issuance of senior unsecured US$ denominated fixed rate notes.
ITC has teamed up with Invest India to crowdsource innovative ideas for single-use plastic substitution and automate waste segregation.
NTPC's clean energy arm -- NREL is all set to float a global engineering procurement and construction tender to set up a 3GW renewable energy project with a battery storage system worth around Rs 15,000 crore by February 2022.