Indian equity benchmarks ended on
a weak note on Friday as Banks, information technology (IT) and TECK stocks
fell sharply during the session. Markets made a gap down opening and traded
lower for the most part of the session, as negative global cues and concerns
over the quarterly financial performance of IT companies hit investor
sentiments. Some concern also came as data available with NSE showed foreign
Institutional Investors (FIIs) were net sellers on Thursday as they sold shares
worth Rs 1,862.57 crore. Sentiments remained weak after the Labor Department
released a separate report showing consumer price growth in the U.S. slightly
exceeded estimates in the month of September. The Labor Department said its
consumer price index climbed by 0.4 percent in September. Street had expected
consumer prices to rise by 0.3 percent. However, key gauges staged some recovery
in the second half of the session, on the back of positive macro-economic data.
India's Consumer Price Index (CPI)-based inflation (retail inflation) eased to
a three-month low of 5.02 per cent year-on-year in September from 6.83 per cent
in August, with moderation in vegetables and fuel prices. Besides, with good
performance by the manufacturing, mining and power sectors, India's industrial
production growth rose to a 14-month high of 10.3 per cent in August. Some
support also came as the Reserve Bank of India (RBI) in its latest survey
report has showed that exports of software services by Indian companies
(excluding their sales through overseas commercial presence) increased by 18.4
per cent during 2022-23 to $185.5 billion. It also noted that computer services
accounted for over two-thirds of total software services exports during the
year; BPO services remained the main component of ITES exports. However,
markets failed to erase all the losses and ended marginally in red. Finally,
the BSE Sensex fell 125.65 points or 0.19% to 66,282.74 and the CNX Nifty was
down by 42.95 points or 0.22% to 19,751.05.
The US markets ended mostly lower
on Friday following a report from the University of Michigan showing a slump in
consumer sentiment and a surge in inflation expectations. The University of
Michigan said its consumer sentiment index tumbled to 63.0 in October from 68.1
in September, while street had expected the index to edge down to 67.4. The
report also showed a sharp increase in year-ahead inflation expectations, which
jumped to 3.8 percent in October from 3.2 percent in September, reaching the
highest level since May. Long-run inflation expectations also rose to 3.0
percent in October from 2.8 percent in September but remained within the narrow
2.9-3.1 percent range seen for 25 of the last 27 months. However, downside
remained capped as traders reacted positively to earnings news from financial
giant JPMorgan Chase (JPM), which moved to the upside after reporting better
than expected third quarter revenue. On the sectoral front, semiconductor
stocks led the technology sector lower on the day, with the Philadelphia
Semiconductor Index plunging by 2.7 percent. Significant weakness was also
visible among networking stocks, as reflected by the 1.8 percent loss posted by
the NYSE Arca Networking Index. Transportation, computer hardware and software
stocks also saw notable weakness, while gold stocks moved sharply higher along
with the price of the precious metal.
Crude oil futures ended sharply
higher on Friday on rising concerns about the potential impact of the ongoing
Israel - Hamas war on global crude supplies. Israel's military called for all
civilians of Gaza City, more than 1 million people, to relocate south within 24
hours. The Israeli military said it would operate significantly in Gaza City in
the coming days and civilians would only be able to return when another
announcement was made. Further, the United States' decision to tighten
sanctions against Russian crude exports has also raised supply concerns. The
U.S. Treasury Department said that it has imposed its first set of sanctions on
two companies that shipped Russian oil in violation of a multinational price
cap of $60 a barrel. Benchmark crude oil futures for November delivery rose
$4.78 or about 5.8 percent to settle at $87.69 a barrel on the New York
Mercantile Exchange. Brent crude for December delivery surged $4.89 or about
5.7 percent to settle at $90.89 a barrel on London's Intercontinental Exchange.
Rupee settled lower against
dollar on Friday on surging crude oil prices overseas and a downward trend in
the domestic equities. Investors ignored data showing that India's Consumer
Price Index (CPI)-based inflation (retail inflation) eased to a three-month low
of 5.02 per cent year-on-year in September from 6.83 per cent in August, with
moderation in vegetables and fuel prices. Besides, India's industrial
production growth rose to a 14-month high of 10.3 per cent in August with good
performance by the manufacturing, mining and power sectors. Moreover, India's
merchandise trade deficit fell to a five-month low of $19.37 billion in
September. While goods exports last month stood at $34.47 billion, imports were
at $53.84 billion. On the global front, U.S. dollar held firm on Friday after
its biggest daily increase since March the day before, as hot U.S. consumer
prices data revived prospects that the Federal Reserve may have to raise rates
further to get inflation back towards its 2% target. Finally, the rupee ended
at 83.28 (Provisional), weaker by 4 paise from its previous close of 83.24 on
Thursday.
The FIIs as per Friday's data
were net sellers in equity segment, while they were net buyers in debt segment.
In equity segment, the gross buying was of Rs 8622.89 crore against gross
selling of Rs 10369.90 crore, while in the debt segment, the gross purchase was
of Rs 2863.98 crore with gross sales of Rs 1995.28 crore. Besides, in the
hybrid segment, the gross buying was of Rs 5.26 crore against gross selling of
Rs 3.55 crore.
The US markets ended mostly in
red on Friday as Investors monitored news from the Middle East. Asian markets
are trading mostly lower on Monday as investors look ahead China's
third-quarter gross domestic product numbers later in the week. Indian markets
ended lower on Friday as weak China data revived fears of a global slowdown.
Today, start of new week is likely to be cautious amid spike in Crude Oil
prices and Israel-Palestine war. Israeli troops prepare for a ground assault on
the Hamas-controlled Gaza Strip. Investors will be eyeing wholesale price
inflation data for September, and Q2-FY24 earnings of India Inc for more
directional cues. Traders will be concerned as India's merchandise exports saw
a fall of 2.6 percent year on year, contracting to $34.47 billion in September.
The fall was also significantly reflected in imports, which contracted by 15
percent to $53.84 billion in September 2023 against September 2022. Traders may
take note of chief economic advisor (CEA) V Anantha Nageswaran's statement that
private investment is happening in India, and inflation is not a concern, but
crude oil prices and tightening global monetary conditions pose a risk.
However, foreign fund inflows likely to aid domestic sentiments. According to
the provisional data available on the NSE, foreign institutional investors
(FII) purchased shares worth net Rs 317.01 crore on October 13, 2023. Some
support may come as the International Monetary Fund (IMF) said the overall
macroeconomic environment in India is pretty sound, it is fiscally disciplined
and the central bank moved fast to bring inflation under control. Krishna
Srinivasan, Director of the Asia and Pacific Department, IMF said They have
been fiscally disciplined. They expect the fiscal at 5.9 per cent this year.
The central bank has moved fast to bring inflation under control. The most
recent number was 5 per cent (for September). So, inflation is coming down. So,
overall, the macroeconomic environment is pretty sound in India. Meanwhile, the
Securities and Exchange Board of India (Sebi) is likely to undertake a new
round of market consultations before allowing the National Stock Exchange (NSE)
to extend its trading hours. Sugar industry stocks will be in focus with report
that the government has given a final call to all legal entities engaged in
sugar trade to declare their stocks on a food ministry website by October 17,
and warned that strict action will be taken against those for violation.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
19,751.05
|
19,655.76
|
19,825.86
|
BSE
Sensex
|
66,282.74
|
65,959.14
|
66,542.63
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata
Motors
|
280.12
|
667.10
|
643.74
|
679.74
|
Tata
Steel
|
269.13
|
125.20
|
124.21
|
125.96
|
HDFC
Bank
|
198.73
|
1533.50
|
1526.04
|
1544.89
|
State
Bank of India
|
190.65
|
576.20
|
573.56
|
580.06
|
Infosys
|
179.73
|
1432.85
|
1409.24
|
1447.24
|
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