The bulls made
a comeback on the D-Street after two straight days of decline, with Sensex and
Nifty settling above their crucial psychological levels of 52,300 and 15,700,
respectively. The benchmarks opened in green and traded firmly higher for most
part of the day, as traders took encouragement with Finance Ministry report
stated that faster vaccine coverage and frontloading of fiscal measures
announced in this year's budget would be the major factors in boosting the
investment and consumption cycles and, in turn, reviving the economy, as
economic activities have slowed down amid the second wave of Covid-19 and
lockdowns across states. Besides, the Finance Ministry said it has released third
monthly instalment of revenue deficit grant of Rs 9,871 crore to 17 states.
With the release of this instalment, total Rs 29,613 crore has been released in
the first three months of the current financial year as Post Devolution Revenue
Deficit (PDRD) Grant to states. Benchmarks gained further momentum in second
half of the session, taking support from the Department of Economic Affairs
(DEA) in its monthly report stating that the economic impact of the second wave
COVID-19 is likely to be restricted to the first quarter of 2022. As per the
DEA, rapid vaccination of India's population and the frontloading of the fiscal
measures are the key to invigorating investment and consumption. Traders
overlooked International Zinc Association (IZA) stating that India loses around
5-7 per cent of its Gross Domestic Product (GDP) every year due to corrosion.
The association also stressed upon the need for immediate and appropriate
measures by authorities to control further damage. Meanwhile, all-powerful GST
Council, chaired by Finance Minister Nirmala Sitharaman, will meet on June 12
to decide on GST rate cut for COVID essentials and black fungus medicine.
Finally, the BSE Sensex rose 358.83 points or 0.69% to 52,300.47, while the CNX
Nifty was up by 102.40 points or 0.65% to 15,737.75.
The US markets ended higher on
Thursday as investors shrugged off a key inflation report that showed a
bigger-than-expected increase in price pressures. The Labor Department said its
consumer price index rose by 0.6 percent in May after climbing by 0.8 percent
in April. Street had expected consumer prices to increase by 0.4 percent.
Excluding food and energy prices, core consumer prices climbed by 0.7 percent
in May following a 0.9 percent advance in April. Core prices were also expected
to rise by 0.4 percent. The report also showed consumer prices in May were up
by 5.0 percent compared to the same month a year ago, reflecting the biggest
spike since August of 2008. The annual rate of core consumer price growth also
accelerated to 3.8 percent in May, which represents the biggest jump since June
of 1992. Further, support also came in as the Labor Department released a
separate report showing another modest decrease in first-time claims for
unemployment benefits. The report showed initial jobless claims edged down to
376,000, a decrease of 9,000 from the previous week's unrevised level of
385,000. Street had expected jobless claims to dip to 370,000. With the slight
drop, jobless claims once again fell to their lowest level since hitting
256,000 in the week ended March 14, 2020. On the sectoral front, Substantial
strength was also visible among biotechnology stocks, as reflected by the 2.4
percent jump by the NYSE Arca Biotechnology Index. The index ended the session
at its best closing level in almost four months.
Crude oil futures ended higher on
Thursday on optimism for strong economic demand after new US unemployment
claims fell to their lowest since the country's first wave of COVID-19 last
year. The number of Americans filing new claims for unemployment benefits fell
last week to the lowest level in nearly 15 months, while consumer prices
increased solidly in May as the pandemic's grip on the economy continues to
ease. Meanwhile, the Organization of the Petroleum Exporting Countries said oil
demand would rise by 6.6%, or 5.95 million barrels per day (bpd), this year.
The monthly forecast was unchanged for a second consecutive month. Crude oil
futures for July rose $0.33 or 0.5 percent to settle at $70.29 barrel on the
New York Mercantile Exchange. August Brent crude gained $0.25 or 0.35 percent
to settle at $72.47 a barrel on London's Intercontinental Exchange.
Indian rupee ended lower against
dollar on Thursday as investors are waiting for crucial inflation data due
today which may hint when the US Fed will tighten their monetary policy.
However, downfall remain capped as Department of Economic Affairs (DEA) in its
monthly report stated that the economic impact of the second wave COVID-19 is
likely to be restricted to the first quarter of 2022. As per the DEA, rapid
vaccination of India's population and the frontloading of the fiscal measures
are the key to invigorating investment and consumption. On the global front;
sterling fell to a one-month low versus the dollar on Thursday after Britain
and the European Union failed to agree on solutions to post-Brexit trade
problems in Northern Ireland. Finally, the rupee ended 73.06, weaker by 9 paise
from its previous close of 72.97 on Wednesday.
The FIIs as per Thursday's data
were net buyer in equity segment, while net seller in debt segment. In equity
segment, the gross buying was of Rs 7058.23 crore against gross selling of Rs
6460.30 crore, while in the debt segment, the gross purchase was of Rs 224.05
crore with gross sales of Rs 2318.97 crore. Besides, in the hybrid segment, the
gross buying was of Rs 26.34 crore against gross selling of Rs 116.43 crore.
The US markets ended higher on
Thursday as economic data appeared to support the Federal Reserve's assertion
that the current wave of heightened inflation will be temporary. Asian markets
are trading mostly in green on Friday tracking a firm finish on Wall Street
overnight. Indian markets ended near-record closing high on Thursday boosted
mainly by banking and financial stocks. Today, the start of session is likely
to be positive following gains in global peers. Investors will be eyeing the
manufacturing and Industrial production data for the month of April set to be
released today post market hours. A fall in the number of Covid cases in the
country likely to keep the sentiment on D-Street upbeat. Fresh daily cases
remained below the 1 lakh mark for the fourth day straight as India reported
91,000 cases in the last 24 hours. The steady decline in cases is igniting
hopes of the further reopening of the economy, providing support to market
mood. Traders will be taking encouragement with Commerce Secretary Anup
Wadhawan's statement that India's export of agricultural and allied products in
2020-21 grew by 17.34 per cent to $41.25 billion, and this growth momentum is
expected to be sustained in the current fiscal as well. He said huge growth has
been seen in the export of cereals, non-basmati rice, wheat, millets, maize and
other coarse grains. Some support will come as the Reserve Bank of India (RBI)
will be buying bonds maturing between 2026 and 2035 in its third tranche of the
G-sec Acquisition Programme (G-SAP). The total size of the G-SAP programme would
be Rs 40,000 crore, including Rs 10,000 crore of state development loans.
Traders may take note of credit rating agency Icra Ratings' report that with
decline in number of fresh COVID-19 cases and easing of restrictions, the
country's gross domestic product (GDP) will grow at 8.5 per cent in FY2021-22.
It expects the gross value added (GVA) at basic prices (at constant 2011-12
prices) to grow at 7.3 per cent in FY2022. Meanwhile, the Goods and Services
Tax (GST) Council will meet on June 12 to decide on extension of compensation
cess beyond 2022 and tax exemption or reduction in rate on various
Covid-related items including vaccines. There will be some reaction in power
stocks with report that India's struggling wind power industry is looking to
its clean energy rival for help emerging from a pandemic-induced slump.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
15,737.75
|
15,673.75
|
15,776.50
|
BSE
Sensex
|
52,300.47
|
52,056.81
|
52,445.24
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
ITC
|
307.19
|
209.30
|
207.40
|
211.30
|
State
Bank of India
|
273.97
|
432.25
|
425.34
|
436.24
|
Tata
Motors
|
243.51
|
344.75
|
342.15
|
347.60
|
NTPC
|
221.44
|
118.50
|
117.24
|
119.84
|
Power
Grid Corporation
|
183.88
|
241.65
|
238.60
|
246.35
|
Tech Mahindra is looking for acquisitions in Europe to upgrade its capabilities in various segments, including cloud computing, 5G, SAP and Salesforce softwares.
Rockwell Industries has entered into strategic partnership with Dr. Reddy's Laboratories, to provide its World Health Organisation - Performance, Quality and Safety certified Covid-19 vaccine freezersto enable storage of Sputnik V vaccine in India.
Tata Motors' wholly owned subsidiary -- Jaguar Land Rover has launched the updated version of its F-PACE SUV in the country priced at Rs 69.99 lakh (ex-showroom).
HDFC is planning to raise up to Rs 2,000 crore by issuing debt securities on a private placement basis to augment its long-term resources.