Indian equity benchmarks traded
lower for the third consecutive session and ended with losses of around two
percent on Friday, led by a fall in global equities amid expectations of strong
a rate hike by the US Federal Reserve.
After a gap-down opening, markets continued to reel under pressure, as
foreign fund outflows have dented investor sentiments. According to data
available with the BSE, foreign institutional investors offloaded shares worth
a net Rs 1,270.68 crore in the domestic market on Thursday. Traders remained
cautious as India Ratings has cuts India's FY23 GDP growth forecast to 6.9 per
cent from 7 per cent, joining other institutions who have cut their projections
to below 7 per cent since the release of the April-June quarter GDP data.
Despite private final consumption expenditure (PFCE) and gross fixed capital
formation (GFCF) growth coming in better than its expectations in Q1, the
agency expects the slowdown in the growth of government final consumption
expenditure (GFCE) and worsening of net exports to weigh on the FY23 GDP
growth. Some concern also came as Global Rating agency Moody's said India's
rated infrastructure firms can largely withstand further depreciation in the
value of rupee against US dollar due to financial hedges and other mitigants.
Key indices extended their fall to close near intraday lows as International
Monetary Fund (IMF) stated that the global economic outlook remains downbeat
and some countries are expected to slip into recession in 2023, but it is too
early to say if there will be a widespread global recession. The IMF in July
revised down global growth to 3.2% in 2022 and 2.9% in 2023. It will release a
new outlook next month. Some pessimism also came after the World Bank said the
world could be heading towards a global recession in 2023 as central banks
across the world simultaneously hike interest rates to combat persistent
inflation. Traders overlooked Union Minister for Petroleum and Natural Gas
Hardeep Singh Puri's statement that the country is on the path to becoming a 10
trillion-dollar economy in 2030 and the third largest economy in the world by
2047. Finally, the BSE Sensex fell 1093.22 points or 1.82% to 58,840.79 and the
CNX Nifty was down by 346.55 points or 1.94% to 17,530.85.
The US markets extended their
previous session's losses and ended at their lowest closing levels in two
months on Friday amid a steep drop by shares of FedEx (FDX). The delivery giant
plunged by 21.4 percent to a two-year closing low. The sell-off by FedEx came
after the company reported weaker than expected preliminary fiscal first
quarter results and withdrew its full-year guidance. FedEx cited global volume
softness and expectations for a continued volatile operating environment and
warned it expects business conditions to further weaken in the second quarter.
The warning from FedEx added to concerns about the outlook for the global
economy amid monetary policy tightening by central banks around the world. Concerns
about the outlook for interest rates also continued to weigh on the markets
ahead of the Federal Reserve's monetary policy decision next week. The Fed is
widely expected to raise interest rates by another 75 basis points, although
some see an outside chance for a 100 basis point rate hike. Meanwhile, traders
largely shrugged off a report from the University of Michigan showing a modest
improvement in consumer sentiment and a decrease in inflation expectations. The
University of Michigan said its consumer sentiment index inched up to 59.5 in
September from 58.2 in August. With the uptick, the consumer sentiment index
reached its highest level since hitting 65.2 in April.
Crude oil futures pared most of
their early gains and settled almost flat on Friday amid supply concerns and
hopes of a robust demand during the later part of the year and in 2023.
Initially, some support also came amid uncertainty about the revival of the
Iranian nuclear deal and the likely impact on supply contributed as well to
oil's uptick. Though, gains got trimmed on reports of the resumption of oil
exports from Iraq's Basra oil terminal, where a spillage had forced disruptions
last night. Meanwhile, a report from Baker Hughes said the number of active
U.S. rigs drilling for oil rose by eight to 599 this week, rising for the first
time in three weeks. It said the total active U.S. rig count, including those
drilling for natural gas, climbed by 4 to 763. Benchmark crude oil futures for
October delivery settled almost flat $0.01 at $85.11 a barrel on the New York
Mercantile Exchange. Brent crude for November delivery rose $0.51 or about 0.6
percent to settle at $91.35 (provisional) a barrel on London's Intercontinental
Exchange.
Indian rupee ended lower against
dollar on Friday, on account of sustained dollar demand from importers and
banks. Traders were worried as IMF spokesman Gerry Rice flagged concerns over
further slowdown in the global economy and said that some countries are
expected to slip into recession in 2023. Concerns over aggressive rate hikes by
the Federal Reserve also put downside pressure on the local unit. However,
downfall remain capped with Union Minister for Petroleum and Natural Gas
Hardeep Singh Puri's statement that the country is on the path to becoming a 10
trillion-dollar economy in 2030 and the third largest economy in the world by
2047. On the global front, dollar rallied again on Friday, as U.S. Treasury
yields rose ahead of a potentially huge Federal Reserve interest rate hike next
week. Finally, the rupee ended at 79.78 (Provisional), weaker by 7 paisa from
its previous close of 79.71 on Thursday.
The FIIs as per Friday's data
were net sellers in equity segment, while net buyers in debt segment. In equity
segment, the gross buying was of Rs 7787.42 crore against gross selling of Rs
8466.91 crore, while in the debt segment, the gross purchase was of Rs 1196.79
crore against gross selling of Rs 322.73 crore. Besides, in the hybrid segment,
the gross buying was of Rs 8.78 crore against gross selling of Rs 12.21 crore.
The US markets ended lower on
Friday, falling to two-month lows as a warning of impending global slowdown
from FedEx hastened investors' flight to safety at the conclusion of a
tumultuous week. Asian markets are trading mostly in red on Monday ahead of
major central bank meetings this week. Benchmark indices ended lower for the
third straight session on Friday led by weak global cues. Today, markets are
likely to get cautious start tracking weak global cues. Traders will be
concerned as data from Reserve Bank showed India Inc's investment in their
overseas ventures dropped by 59 per cent on an annual basis to $1.03 billion in
August this year. Some pessimism may come as the country's foreign exchange
reserves declined by $2.234 billion to stand at $550.871 billion for the week
ended September 9. There will be some cautiousness with a report that India's
current account deficit (CAD), a key indicator of balance of payment of a
country, is likely to remain within 3 percent of the GDP in 2022-23 as against
1.2 percent during the last fiscal. Foreign fund outflows likely to dent
sentiments in domestic markets. Foreign institutional investors (FIIs) have net
sold shares worth Rs 3,260.05 crore on September 16, as per provisional data
available on the NSE. However, some respite may come later in the day as the
finance ministry said gross direct tax collections grew 30 per cent to Rs 8.36
lakh crore till September 17 of current fiscal year on higher advance tax
mop-up buoyed by the economic revival post pandemic. Some support may come as
foreign investors pumped Rs 12,000 crore into the Indian equity market so far
this month on hopes that global central banks, particularly the US Fed, may go
slow on rate hikes as inflation starts to cool off. Traders may take note of
report that Prime Minister Narendra Modi has unveiled the National Logistics
Policy that seeks to address challenges facing the transport sector and bring
down the logistics cost of businesses from 13-14 per cent to a single digit. He
said the policy aims to expedite the last-mile delivery, helping businesses
save time and money. Besides, Union minister Nitin Gadkari has said that the
National Logistics Policy which focuses on re-engineering, digitisation and
multimodal transport, would further boost ease of doing business for all
industries and stakeholders. Some optimism may also come as the government in
its monthly economic review for August said that a sharp rebound in consumer
spending and rising employment will sustain economic growth in India in the
months ahead. Oil & gas and aviation industry stocks will be in focus as
the government cut the windfall profit tax on locally produced crude oil in
line with a fall in international rates, and reduced the levy on export of
diesel and jet fuel (ATF).
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,530.85
|
17,412.05
|
17,734.85
|
BSE
Sensex
|
58,840.79
|
58,445.12
|
59,478.51
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Steel
|
1,079.67
|
105.60
|
104.56
|
107.06
|
NTPC
|
261.26
|
173.65
|
171.74
|
175.14
|
Power Grid Corporation of India
|
220.49
|
236.00
|
233.45
|
238.50
|
Tata Motors
|
209.92
|
433.00
|
425.94
|
443.24
|
Oil & Natural Gas Corporation
|
209.09
|
130.95
|
129.96
|
131.96
|
UPL has entered into a joint venture with CleanMax Enviro Energy Solutions to establish a hybrid solar-wind energy power plant in Gujarat, India.
ICICI Bank has raised Rs 2100 crore through allotment of 21,000 senior unsecured redeemable long term bonds in the nature of debentures.
Reliance Industries' telecom arm -- Reliance Jio Infocomm has added 29,49,389 customers in July 2022.
Adani Ports and Special Economic Zone's wholly owned subsidiary -- HDC Bulk Terminal has signed the Concession Agreement with Syama Prasad Mookerjee Port, Kolkata for mechanization of Berth no. 2 at Haldia Dock Complex in Bengal.