Indian equity benchmarks ended
sharply lower on Thursday as weekly F&O expiry and profit booking post the
Reserve Bank of India's monetary policy decision put pressure on the indices.
Markets made a cautious start but soon gained some traction as foreign fund inflows
supported the market sentiments. Provisional data from the National Stock
Exchange showed that foreign institutional investors (FIIs) bought shares worth
Rs 1,382.57 crore on June 7. Buying further crept in after the Reserve Bank of
India's (RBI) monetary policy committee unanimously decided to keep the repo
rate unchanged at 6.5 per cent. Besides, RBI retains growth projection at 6.5
per cent for FY24, expects 8 per cent growth in Q1, 6.5 per cent in Q2, 6 per
cent in Q3 and 5.7 per cent in Q4. It also lowers retail inflation projection
to 5.1 per cent during FY'24 from earlier estimate of 5.2 per cent. Traders
also found some support with a private report stating that Consumer price
inflation in India likely cooled to a 20-month low in May as food price rises
slowed further, drawing closer to the Reserve Bank of India's medium-term
target of 4%. Food inflation, which accounts for nearly half of the consumer
price index (CPI) basket, eased to 3.84% in April and was expected to have
declined further last month. However, markets reversed their initial gains and
slipped into red terrain in afternoon deals, as traders turned cautious after
the Organization for Economic Co-operation and Development (OECD) marginally
raised its 2023-24 (FY24) growth forecast for India to 6 per cent, from 5.9 per
cent estimated earlier, while mentioning that weak global demand and the effect
of monetary policy tightening will constrain growth in the world's
fifth-largest economy in the current fiscal year. The street took a note of a
private report stating that India's currency in circulation dropped for a
second consecutive week after the central bank withdrew the country's highest
value currency note in May, advising people to deposit those with various banks
and hoping to help lender deposits in the process. Finally, the BSE Sensex fell
294.32 points or 0.47% to 62,848.64 and the CNX Nifty was down by 91.85 points
or 0.49% to 18,634.55.
The US markets ended higher on
Thursday on easing concerns about the outlook for interest rates following the
release of a Labor Department report showing initial jobless claims increased
by much more than expected last week. The Labor Department said initial jobless
claims climbed to 261,000 in the week ended June 3rd, an increase of 28,000
from the previous week's revised level of 233,000. Street had expected jobless
claims to inch up to 235,000 from the 232,000 originally reported for the
previous week. With the much bigger than expected advance, jobless claims
reached their highest level since hitting 264,000 in the week ended October 30,
2021. Traders took note of report that the Commerce Department showed a slight
decrease in U.S. wholesale inventories in the month of April. The Commerce
Department said wholesale inventories edged down by 0.1 percent in April after
dipping by a revised 0.2 percent in March. Street had expected wholesale
inventories to slip by 0.2 percent compared to the unchanged reading originally
reported for the previous month. The modest decrease in wholesale inventories
came as inventories of non-durable goods tumbled by 1.2 percent, more than
offsetting a 0.6 percent increase in inventories of durable goods. On the
sectoral front, Retail stocks showed a strong move back to the upside after
falling sharply on Wednesday, driving the Dow Jones U.S. Retail Index up by 1.4
percent. Significant strength was also visible among pharmaceutical stocks, as
reflected by the 1.2 percent gain posted by the NYSE Arca Pharmaceutical Index.
Crude oil futures pared some
losses and ended lower on Thursday, after falling by more than $3 a barrel in
early trade, after the White House called a news report that the U.S. and Iran
may be approaching a deal on oil exports false. Oil prices fell sharply in
early trade after private report stated Iran and the U.S. are nearing a
temporary deal that would swap some sanctions relief for reducing Iranian
uranium enrichment activities. Besides, concerns about the outlook for energy
demand continued to weigh on the markets, keeping the price of crude oil stuck
firmly in the red. Benchmark crude oil futures for July delivery fell $1.24 or
about 1.7 percent to settle at $71.29 a barrel on the New York Mercantile
Exchange. Brent crude for August delivery dropped $0.99 or 1.27 percent to
settle at $75.96 a barrel on London's Intercontinental Exchange.
Rupee settled lower against
dollar on Thursday even after the Reserve Bank kept the key interest rate
unchanged. The Reserve Bank of India, in its second bi-monthly policy for FY24,
has decided to keep the policy repo rate under the liquidity adjustment
facility (LAF) unchanged at 6.50 per cent for second time in a row. The
standing deposit facility (SDF) rate remains unchanged at 6.25 per cent and the
marginal standing facility (MSF) rate and the Bank Rate at 6.75 per cent. On
the global front, dollar fell slightly on Thursday from near three-month highs,
a day after a surprise rate hike from the Bank of Canada suggested the Federal
Reserve may also have more work to do to combat inflation. Finally, the rupee
ended at 82.57 (Provisional), weaker by 5 paise from its previous close of
82.52 on Wednesday.
The FIIs as per Thursday's data
were net buyers in both equity and debt segment. In equity segment, the gross
buying was of Rs 9609.15 crore against gross selling of Rs 8165.16 crore, while
in the debt segment, the gross purchase was of Rs 377.10 crore against gross
selling of Rs 227.92 crore. Besides, in the hybrid segment, the gross buying
was of Rs 5.19 crore against gross selling of Rs 8.91 crore.
The US markets ended higher on
Thursday regaining some of their momentum thanks to a rebound by technology
stocks. Asian markets are trading mixed on Friday amid data showing that
China's consumer prices increased slightly in May while factory-gate prices
continued to contract. Indian markets surrendered early gains to close with
losses on Thursday, as investors pared exposure to auto, bank and IT stocks
after the RBI left its key interest rate unchanged. Today, in line with firm
trade on Wall Street overnight, the local benchmark indices likely to open in
green. Investors now will shift the focus to upcoming domestic and US inflation
data and Fed policy. Foreign fund inflows likely to support domestic
sentiments. Foreign portfolio investors (FPIs) net purchased Indian shares
worth Rs 212.40 crore on June 08, according to provisional exchange data. Some
support will come with report that monsoon rain reached the coast of India's
southernmost Kerala state on Thursday, offering relief to farmers after a delay
of more than a week, marking its latest arrival in four years. Besides,
Associated Chambers of Commerce and Industry of India (ASSOCHAM) stated that
the Reserve Bank of India's decision to keep the benchmark interest rates
unchanged is on the expected lines, and added that the focus of the monetary
policy is clearly on further taming inflation for a stable growth. Traders may
take note of Additional Director General of Foreign Trade (DGFT) S C Aggarwal's
statement that a robust and easy trade finance ecosystem is important for India
to achieve the $2 trillion exports target by 2030. It said easy availability of
affordable trade finance helps promote export competitiveness. Meanwhile, the
Reserve Bank came out with guidelines on default loss guarantee (DLG) in
digital lending, a move aimed at ensuring the orderly development of the credit
delivery system. Moreover, the Customs Department will introduce additional
disclosures for the export and import of medicinal products from July 1 to
fast-track clearances of shipments. Stocks related to railways stocks with
report that the Ministry of Railways has reported an earning of Rs 14642 crore
from freight loading in May 2023, a four per cent increase compared to last
year at Rs 14,084 crore. The freight loading amount reported in May 2023 is
also two per cent more than last year at 134 million tonnes (mt). It was 131 mt
last year.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
18,634.55
|
18,574.14
|
18,736.44
|
BSE
Sensex
|
62,848.64
|
62,651.78
|
63,183.45
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata
Steel
|
463.80
|
111.25
|
110.46
|
112.51
|
NTPC
|
273.83
|
182.85
|
179.19
|
185.44
|
Tata
Motors
|
215.27
|
560.50
|
552.81
|
572.36
|
HDFC
Bank
|
186.98
|
1608.35
|
1599.06
|
1621.81
|
ICICI
Bank
|
176.08
|
938.95
|
932.60
|
947.90
|
ONGC has signed a MoU with Iceland GeoSurvey, taking a significant step towards the exploration and development of geothermal energy in India.
Axis Bank has dealt its first onshore INR Non Deliverable Derivative trade with a large South based domestic corporate client.
M&M has entered the dual-fuel segment in the small commercial vehicle space with the launch of Supro CNG Duo priced at Rs 6.32 lakh (ex-showroom Delhi).
Bharti Airtel has surpassed the 2 million unique 5G user mark on its network in Bihar and Jharkhand.