Indian equity
benchmarks closed at record closing highs for yet another session driven by
gains in index major Reliance Industries amid by largely positive trend in
global markets and sustained foreign fund inflows. Benchmarks made positive
start, as sentiments got boost with the commerce ministry's provisional data
showed that India's exports jumped 45.17 per cent to $33.14 billion in August
as against $22.83 billion in the same month last year. Traders also found some
support with Union Minister Nitin Gadkari's statement that the Rs 100 lakh
crore-Gatishakti scheme will provide a framework for the National
Infrastructure Pipeline programme and make Indian products more competitive by
cutting down logistic costs and improving supply chains. He also sought
investments in the road sector from insurance and pension funds of the US.
However, benchmarks witnessed volatility in late morning deals due to a
consistent rise in the coronavirus cases and fear of a third Covid wave is
driving investors towards defensive bets. India reported over 45,000 new cases
of Covid-19 in the last 24 hours. This was also the biggest single-day rise in
two months. Some concern also came with Ratings agency ICRA's statement that
fiscal balances of 19 states in the quarter ended June of current financial
year (Q1FY22) are weaker than pre-Covid levels with milder recovery in revenue
and spending. But, markets soon regained positive momentum to end higher as
India's service sector growth resumed in the month of August as the pandemic
continued to recede and vaccine access improved. As per the survey report, the
seasonally adjusted Nikkei Services Business Activity Index stood at 56.7 in
August from 45.4 in July. Further, the Nikkei India Composite PMI Output Index
-- which measures both manufacturing and services -- stood at 55.4 in August,
from 49.2 in July. Adding to the optimism, a report said hiring activity in
India has been on a steady recovery and the hiring rate in July this year was
around 65 per cent above the pre-COVID level. Finally, the BSE Sensex rose
277.41 points or 0.48% to 58,129.95, while the CNX Nifty was up by 89.45 points
or 0.52% to 17,323.60.
The US markets ended lackluster
trade mostly in red on Friday with traders showing some uncertainty about the
repercussions of the Labor Department's monthly jobs. Despite the choppy
trading, the tech-heavy Nasdaq reached a new record closing high. The choppy
trading on Wall Street came as traders digested the Labor Department's closely
watched monthly employment report, which showed much weaker than expected job
growth in the month of August. The report suggests the delta variant of the
coronavirus is weighing on the labor market, although the data could also lead
the Federal Reserve to push back its plans to begin scaling back stimulus. Fed
officials have indicated inflation has reached their target but they need to
see further improvement in the labor market before they begin tapering asset
purchases and raising interest rates. The Labor Department said non-farm
payroll employment rose by 235,000 jobs in August after soaring by an upwardly
revised 1.053 million jobs in July. Street had expected employment to jump by
about 750,000 jobs compared to the spike of 943,000 jobs originally reported
for the previous month. Despite the much weaker than expected job growth, the
unemployment rate fell to 5.2 percent in August from 5.4 percent in July,
matching street estimates. Meanwhile, separate report released by the Institute
for Supply Management showed U.S. service sector growth slowed from a record
pace in the month of August. The ISM said its services PMI fell to 61.7 in
August after reaching an all-time high of 64.1 in July, although a reading
above 50 still indicates growth in the sector. Street had expected the index to
drop to 61.5.
Crude oil futures settled lower
on Friday, amid worries about demand after smaller-than-expected gains in U.S.
nonfarm payrolls in August. Data released Friday showed U.S. nonfarm payrolls
rose by 235,000 jobs in August, well below the 720,000 increase expected by
market participants surveyed by The Wall Street Journal. Oil prices moved
higher earlier in the session on reports saying a slow recovery for the U.S.
Gulf Coast export and refining hub from the impact of Hurricane Ida could
result in a drop in oil stockpiles. Crude oil futures for October fell 70 cents
or 1 percent to settle $69.29 barrel on the New York Mercantile Exchange.
November Brent crude lost 42 cents or 0.6% percent to settle at $72.61 a barrel
on London's Intercontinental Exchange.
Indian rupee ended higher against
the American currency on Friday, due to selling of the US currency by exporters
and banks. Traders took support with commerce ministry's provisional data
showing that India's exports jumped 45.17 per cent to $33.14 billion in August
as against $22.83 billion in the same month last year. Investors also got
relief after India's services sector expanded in August at the fastest pace in
one-and-a-half years amid strong inflows of new work and improved demand
conditions. The seasonally adjusted India Services Business Activity Index rose
from 45.4 in July to 56.7 in August, as the reopening of several establishments
and increased consumer footfall boosted sales. On the global front; dollar sank
to its lowest in almost a month against major rivals on Friday, ahead of a
crucial U.S. jobs report that could spur the Federal Reserve to an earlier
tapering of stimulus. Finally, the rupee ended 73.02, stronger by 4 paise from
its previous close of 73.06 on Thursday.
The FIIs as per Friday's data
were net buyer in equity segment and net seller in debt segment. In equity
segment, the gross buying was of Rs 10077.04 crore against gross selling of Rs
8742.45 crore, while in the debt segment, the gross purchase was of Rs 720.28
crore with gross sales of Rs 790.73 crore. Besides, in the hybrid segment, the
gross buying was of Rs 12.97 crore against gross selling of Rs 26.20 crore.
The US markets ended mostly lower
on Friday as slower US jobs growth raised questions about the pace of the
recovery. Asian markets are trading mostly in green on Monday amid an ongoing
rally in Japan sparked by the planned exit of the prime minister and as traders
mulled slower U.S. hiring that may delay a reduction in stimulus. Indian
markets ended at record high levels on Friday led by strong gains in metals,
energy and auto stocks. Today, the start of holiday truncated week is likely to
be higher amid mixed global cues. Markets will remain shut on Friday, September
10, on account of Ganesh Chaturthi. Traders will be taking encouragement with a
private report that recovering from the economic slump caused by the pandemic,
hiring trends saw an improvement in August. The previous month saw a 26%
on-year increase in hiring activity to 2.78 lakh. Although the numbers are a
tad bit shy of where they were in July, experts say the trend remains positive
brushing away any concerns. Some support will come with a private report that
the government's collections from levy of excise duty on petroleum products
have jumped 48 per cent in the first four months of the current fiscal year,
with the incremental mop-up being 3-times of the repayment liability of legacy
oil bonds in the full fiscal. Also, the RBI data showed that the country's
foreign exchange reserves soared by $16.663 billion to touch a lifetime high of
$633.558 billion in the week ended August 27, mainly due to an increase in
Special Drawing Rights (SDR) holdings. Traders may take note of report that the
government is likely to extend an incentive scheme for leather and footwear
industries, IFLADP, till 2025-26 with an outlay of Rs 1,700 crore, to further
boost manufacturing, exports and job creation. Besides, foreign portfolio
investors (FPIs) were net buyers to the tune of Rs 16,459 crore in Indian
markets in August, with majority of investment coming in the debt segment. In
equities, they invested just Rs 2,082.94 crore while debt segment saw inflow of
Rs 14,376.2 crore between August 2-31. There will be some buzz in metal stocks
as Minister of State (MoS) for Steel Faggan Singh Kulaste said India's crude
steel output is expected to soar about 18 per cent to 120 million tonnes (MT)
by the end of the ongoing financial year. Textile industry stocks will be in
focus as Textiles Minister Piyush Goyal said the value of textile exports
should be increased to $100 billion from $33 billion currently. There will be
some reaction in coal industry stocks as in order to make more coal available
to power plants that do not have any power purchase agreement (PPA), the union
power ministry agreed to changes in the guidelines for SHAKTI scheme.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,323.60
|
17,243.84
|
17,371.74
|
BSE
Sensex
|
58,129.95
|
57,864.41
|
58,295.13
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Oil & Natural Gas Corporation
|
213.26
|
123.10
|
120.10
|
124.80
|
Tata Motors
|
165.94
|
295.55
|
292.89
|
297.34
|
HDFC Life Insurance Company
|
156.00
|
734.40
|
725.15
|
745.70
|
Indian Oil Corporation
|
152.71
|
113.10
|
110.96
|
114.36
|
State Bank of India
|
142.33
|
431.40
|
428.30
|
434.40
|
HDFC Life Insurance has received an approval to acquire 100 percent stake in Exide Life Insurance from Exide Industries for aggregating to Rs 6,687 crore.
M&M is planning to cut output at its automotive division by up to 25% owing to no production days of around 7 days across its plants due to semiconductor shortage.
Nestle India has partnered with Reliance Jio for its campaign to encourage people to mask up and follow COVID-19-appropriate behavior.
Reliance Industries is aiming to generate at least 100 gigawatts of electricity from renewable sources by 2030, which can be converted into carbon-free green hydrogen.