Indian equity benchmarks ended
volatile day on a mixed note on Wednesday as the euphoria about the Budget
fizzled out, with investors going for profit-taking ahead of the Fed interest
rate decision. Key gauges made a jubilant start and traded with positive bias
in the first half of the session, as traders took some encouragement with Chief
Economic Advisor (CEA) V Anantha Nageswaran's statement that India has the
potential to grow at 6.5-7 per cent and will become a $5 trillion economy by
2025-26 and $7 trillion by 2030 depending on exchange rate fluctuation.
Sentiments remained up-beat as Federation of Indian Export Organisations (FIEO)
said increasing exports to markets such as Brazil, South Africa and Saudi
Arabia are boosting the growth of the country's outbound shipments. Benchmarks
extended their gains in afternoon session after Union Finance Minister Nirmala
Sitharaman in her Budget speech in Parliament announced that the government
proposes to increase capital expenditure outlay by 33 per cent to Rs 10 lakh
crore in 2023-24, which would be 3.3 per cent of the GDP. Besides, Finance
Minister tweaked the slabs to provide some relief to the middle class by
announcing that no tax would be levied on annual income of up to Rs 7 lakh
under the new tax regime. Some support came with the government data showing
that production of eight infrastructure sectors rose at a three-month high of
7.4 per cent in December 2022 against 4.1 per cent in the same month of
previous year on a better show by coal, fertiliser, steel, and electricity
segments. Adding more optimism, the finance ministry said the GST collection in
January surged to over Rs 1.55 lakh crore, the second highest-ever mop-up.
However, markets failed to hold gains in late afternoon deals. Some concerns
came with a private survey showing that India's manufacturing industry started
the year on a weaker note, expanding at the slowest pace in three months in
January as output and sales growth slackened. The Manufacturing Purchasing
Managers' Index, compiled by S&P Global, fell to 55.4 last month from 57.8
in December. Still, it remained well above the 50-mark separating growth from
contraction for a 19th straight month. Finally, the BSE Sensex rose 158.18
points or 0.27% to 59,708.08 and the CNX Nifty was down by 45.85 points or
0.26% to 17,616.30.
The US markets settled higher on
Wednesday with Nasdaq ending gain of two percent. The late-day rally on markets
came even as the Federal Reserve announced its widely expected decision to
raise interest rates by another quarter point and signaled further rate hikes.
After a two-day meeting, the Fed said it has decided to raise the target range
for the federal funds rate by 25 basis points to 4.50 to 4.75 percent. The
latest interest rate hike comes after the central bank raised rates by 75 basis
points in November and by 50 basis points in December. The Fed also said it
anticipates ongoing increases in interest rates will be appropriate in order to
attain a stance of monetary policy that is sufficiently restrictive to return
inflation to 2 percent over time. Fed Chair Jerome Powell said the central bank
does not believe rates are yet at a sufficiently restrictive policy stance and
suggested a couple of more rate hikes will be needed to get to that level. The
next monetary policy meeting is scheduled for March 21-22, with CME Group's
FedWatch Tool currently indicating an 81.8 percent chance the Fed will raise
rates by another 25 basis points. On the sectoral front, Semiconductor stocks
turned in some of the market's best performances on the day, with the
Philadelphia Semiconductor Index spiking by 5.2 percent to a five-month closing
high. Chipmaker Advanced Micro Devices (AMD) helped lead the sector higher,
skyrocketing by 12.6 percent after reporting better than expected fourth
quarter results.
Crude oil futures ended deeply in
red on Wednesday on rising crude inventories in the US. Data from Energy
Information Administration (EIA) showed crude inventories in the US rose by 4.1
million barrels last week, rising for a sixth straight week. Crude inventories
were expected to rise just 0.4 million barrels last week. Gasoline inventories
increased by 2.6 million barrels last week, while distillate stockpiles rose by
2.3 million barrels in the week. Meanwhile, the Organization of the Petroleum
Exporting Countries (OPEC) and allies, collectively known as OPEC+, decided to
keep their output policy unchanged. Benchmark crude oil futures for March
delivery fell $2.46 or 3.1 percent at $76.41 a barrel on the New York
Mercantile Exchange. Brent crude for April delivery dropped $2.62 or 3.1
percent at $82.84 (Provisional) a barrel on London's Intercontinental Exchange.
Indian rupee tumbled against
dollar on Wednesday after Finance Minister Nirmala Sitharaman presented the
Union Budget for 2023-24. Sentiments were downbeat after report stated that
India's manufacturing industry started the year on a weaker note, expanding at
the slowest pace in three months in January as output and sales growth
slackened. The Manufacturing Purchasing Managers' Index, compiled by S&P
Global, fell to 55.4 last month from 57.8 in December. On the global front,
dollar edged lower against the euro on Wednesday ahead of an eagerly-awaited
Federal Reserve policy decision with investors hoping the U.S. central bank
will signal the end of its interest rate hiking cycle. Finally, the rupee ended
at 81.90 (Provisional), weaker by 2 paise from its previous close of 81.88 on
Tuesday.
The FIIs as per Wednesday's data
were net sellers in equity segment, while net buyers in debt segment. In equity
segment, the gross buying was of Rs 15171.56 crore against gross selling of Rs
19829.43 crore, while in the debt segment, the gross purchase was of Rs 2253.61
crore against gross selling of Rs 585.77 crore, while in the hybrid segment,
the gross buying was of Rs 3.60 crore against gross selling of Rs 30.35 crore.
The US markets ended higher on
Wednesday after the Federal Reserve raised interest rates by a quarter of a
percentage point. The move was widely expected, and the Fed signaled that
ongoing increases to short-term rates will be appropriate. Asian markets were
trading mostly in green in early deals on Thursday amid the United States
Federal Reserve raised interest rates by 25 basis points and predicted the US
economy will avoid a contraction this year. Indian equity markets ended flat on
Wednesday after Finance Minister Nirmala Sitharaman presented the Budget in the
Lok Sabha. Today, markets are likely to make negative start, despite firm cues
from global markets, amid Federal Reserve Chair Jerome Powell said policymakers
expect to deliver a couple more interest-rate increases before putting their
aggressive tightening campaign on hold. There may be some cautiousness as an
analyst at Moody's Investors Service said that the Indian federal government's
aim to achieve a fiscal deficit target of 4.5% of gross domestic product (GDP)
by 2025/26 could see some risks. The current pattern suggests that perhaps
there could be some upward pressure on expenditure especially if they
(government) continue with this focus on capex. Meanwhile, a private surveys
report said that Manufacturing activity across the United States, Europe and
Asia contracted again last month, underscoring the fragility of the global
economic recovery, although factories in the euro zone at least may have passed
the trough. However, some respite may come later in the day as Commerce and
Industry Minister Piyush Goyal said a number of measures such as tweaks in
customs duties on certain products announced in the Union Budget for 2023-24
will help boost the country's exports. He said that despite global economic
uncertainties, India's goods and services exports together are registering
nearly 14-15 per cent growth. Some support may also come in as the Centre for
Monitoring Indian Economy's (CMIE's) data has showed that India's unemployment
rate fell to 7.14% in January, the lowest in four months, from 8.30% in the
previous month. It showed the urban unemployment rate declined to 8.55% in
January from 10.09% in the previous month, while the rural unemployment rate
slipped to 6.48% from 7.44%. There may be some buzz in banking sector related
stocks as Finance Minister Nirmala Sitharaman proposed certain amendments to
the Banking Regulation Act, the Banking Companies Act and the Reserve Bank of
India Act to improve bank governance and enhance investors' protection. In her
Budget speech, the finance minister said reforms in the financial sector and
innovative use of technology have led to financial inclusion at scale, better
and faster service delivery, ease of access to credit and participation in
financial markets.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,616.30
|
17,322.40
|
17,941.20
|
BSE
Sensex
|
59,708.08
|
58,758.80
|
60,715.40
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Steel
|
729.19
|
122.05
|
119.51
|
124.36
|
ITC
|
645.18
|
359.60
|
337.24
|
373.84
|
Adani Ports & Special Economic Zone
|
465.57
|
504.00
|
432.66
|
602.16
|
ICICI Bank
|
392.37
|
850.05
|
823.74
|
875.79
|
State Bank of India
|
382.18
|
527.00
|
495.90
|
561.55
|
Reliance Industries' step down arm -- Reliance Consumer Products has entered into a strategic partnership with Sri Lanka headquartered Maliban Biscuit Manufactories.
Tata Motors has raised the second and final tranche of Rs 3,750 crore from TPG Rise Climate as per an agreement inked in 2021.
Tata Consultancy Services has launched Clever Energy Solution on Google Cloud to Help Organizations Achieve their Net Zero Goals.
Coal India has reported rise of 69.41% in its consolidated net profit at Rs 7719.11 crore for Q3FY23 as compared to Rs 4556.54 crore for the same quarter in the previous year.