Indian equity
benchmarks fell for the second straight session on Tuesday, led by selling
pressure in realty, metal and power stocks amid weak global cues. Key indices
made negative start and traded lower for whole day, as traders remained
cautious with a private report that investments by private equity and venture
capital funds declined by 22 per cent to $5.4 billion in June, as compared to
the $6.9 billion in the year-ago period. Some cautiousness also came in as
ratings agency Crisil said the lull in monsoon over the past 15 days up to July
12 has impacted pace of sowing of kharif crops in 2021-22 crop year
(July-June). Traders were also concerned with Minister of State for Finance
Bhagwat K Karad stating that the recovery as a percentage of gross
non-performing assets moderated to 12.8 percent in 2020-21 from 15.8 percent in
the previous fiscal year against the backdrop of the pandemic. Traders also
took a note of report where Parliament informed that over Rs 81,000 crore GST
compensation is due to states for 2020-21, while for April-May this year, Rs
55,345 crore is outstanding. The economic impact of the pandemic has led to
higher compensation requirement due to lower GST collection and at the same
time lower collection of GST compensation cess. However, markets recouped some
intra-day losses as traders found some solace with Union minister Pankaj
Chaudhary's statement that Indian economy is showing signs of revival since the
peaking of the second COVID wave in the first half of May on the back of
targeted fiscal relief, strong push for capital expenditure, RBI's monetary
policy measures, and a rapid vaccination drive. Some support also came as Chief
Economic Adviser (CEA) K V Subramanian has expressed hope that economic growth
during the current financial year (FY22) would be around 11 per cent as
projected in the latest Economic Survey. He also said the overall impact of the
second wave on the economy will not be very large. But, markets failed to
erased all the losses and ended lower as Asian Development Bank (ADB) in its
latest report has downgraded India's economic growth forecast for the current
financial year to 10 percent, from 11 percent projected in April. Finally, the
BSE Sensex fell 354.89 points or 0.68% to 52,198.51, while the CNX Nifty was
down by 120.30 points or 0.76% to 15,632.10.
The US markets ended higher on
Wednesday, extending the substantial rebound seen in the previous session. The
continued strength on markets partly reflected a positive reaction to the
latest batch of earnings reports from several big-name companies. Dow components Coca-Cola and Verizon moved to
the upside after reporting better than expected quarterly results and raising
their full-year guidance. Healthcare giant Johnson & Johnson also closed
higher after reporting second quarter results that exceeded street estimates.
On the other hand, shares of Netflix fell sharply after the streaming giant
reported weaker than expected second quarter earnings and forecast subscriber
growth in the current quarter below street estimates. On the sectorl front,
Energy stocks moved sharply higher on the day as the price of crude oil
continued to recover from the steep drop seen on Monday. Reflecting the
strength in the energy sector, the Philadelphia Oil Service Index skyrocketed
by 4.8 percent and the NYSE Arca Oil Index surged up by 3.8 percent.
Significant strength was also visible among airline stocks, as reflected by the
3.2 percent jump by the NYSE Arca Airline Index. The index continued to rebound
after ending Monday's trading at a five-month closing low. Semiconductor stocks
also turned in a particularly strong performance on the day, driving the
Philadelphia Semiconductor Index up by 3.1 percent.
Crude oil futures ended higher on
Wednesday as a decline in crude stocks
at the Cushing, Okla. storage hub to the lowest level since early 2020 provided
support, outweighing any pressure from the first weekly US crude inventory rise
since mid-May. The Energy Information Administration (EIA) reported that US
crude inventories rose by 2.1 million barrels for the week ended July 16,
marking the first weekly rise in nine weeks. The EIA data also showed crude
stocks at the Cushing, Okla., storage hub declined by 1.4 million barrels for
the week to 36.7 million barrels. Stocks at the storage hub haven't been this
low since January 2020. The EIA also reported that gasoline supplies edged down
by 100,000 barrels, while distillate stockpiles fell by 1.3 million barrels for
the week. Crude oil futures for September rose $3.10 or about 4.6 percent to
settle at $70.30 barrel on the New York Mercantile Exchange. September Brent
crude gained $2.88 or 4.2 percent to settle at $72.23 a barrel on London's
Intercontinental Exchange.
Reversing previous session
losses, Indian rupee ended significantly higher against dollar on Tuesday,
owing to dollar sale by exporters and banks. Sentiments were upbeat as Union
minister Pankaj Chaudhary states that Indian economy is showing signs of
revival since the peaking of the second COVID wave in the first half of May on
the back of targeted fiscal relief, strong push for capital expenditure, RBI's
monetary policy measures, and a rapid vaccination drive. Adding more optimism,
unemployment rate fell to a six-month low of 5.98% for the week ended July 18 after
inching up to 7.64% in the previous week. On the global front, pound hit a
five-month low against the dollar and traded close to a five-week low against
the euro on Tuesday, as broad demand for the safe-haven dollar amid a global
surge in coronavirus infections kept investors jittery. Finally, the rupee
ended 74.61, stronger by 27 paise from its previous close of 74.88 on Monday.
The FIIs as per Tuesday's data
were net seller in both equity and debt segment. In equity segment, the gross
buying was of Rs 6322.33 crore against gross selling of Rs 8600.89 crore, while
in the debt segment, the gross purchase was of Rs 336.47 crore against gross
selling of Rs 435.46 crore. Besides, in the hybrid segment, the gross buying
was of Rs 3.13 crore against gross selling of Rs 17.19 crore.
The US markets ended higher on
Wednesday as investors turned their attention to company earnings, which have
started to roll in steadily. Asian markets are trading in green on Thursday
tracking the optimism in US stocks, amid markets in Japan closed for a holiday.
Indian markets closed lower Tuesday as media, financials, and metal stocks
dragged the indices. Markets were shut Wednesday on account of Bakri Id. Today,
domestic indices looks to resume trade in green after a one-day gap, thanks to
a rally in US equities over the last two days. Traders may take note of report
that in order to bring more discipline, transparency, and accountability into
the corporate insolvency process, resolution professionals (RPs) will be
required to inform the adjudicating authority about avoidance transactions of a
corporate debtor, according to the amended Insolvency and Bankruptcy Board of
India (IBBI) Regulations, 2016. However, there may be some concern as
increasing commodity prices forced the government's crude oil import bill to
swell by a massive 190.6% on-year basis in the first quarter to reach $24.7
billion. India's crude oil import value during the quarter stood at 51 million
tonne, up 14.7% from the previous year. There may be some cautiousness as the
health ministry said India reported its highest death toll in a month on
Wednesday--3,998--after Maharashtra reconciled its death count with 3,509
previously unreported fatalities. Meanwhile, the government has decided not to
impose anti-dumping duty on imports of a certain type of fibre board, used to
make furniture and cabinets, from Vietnam, Malaysia, Thailand, and Indonesia,
as per an office memorandum of the Department of Revenue. Real estate industry
stocks will be in focus as Durga Shanker Mishra, Secretary, Ministry of Housing
and Urban Affairs said the size of real estate sector is expected reach $1 trillion
by 2030 from $200 billion at present. There will be some reaction in auto industry stocks with a private report
that India's automotive electronics market is expected to cross $18 billion by
2027 with a compound annual growth rate (CAGR) of 17 per cent, driven by rising
income levels and increasing customer preference for in-vehicle digital
experience. Besides, Policybazzar is planning to raise Rs 6,500 crore. PB
Fintech, the parent company of Policybazaar in a regulatory filing approved a
resolution to raise the said amount via a fresh issue of equity. There will be
lots of important earnings announcements too, to keep the markets in action.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
15,632.10
|
15,564.29
|
15,714.19
|
BSE
Sensex
|
52,198.51
|
51,986.33
|
52,437.85
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Motors
|
276.72
|
302.15
|
299.46
|
306.41
|
ITC
|
236.56
|
206.80
|
205.70
|
208.60
|
Oil & Natural Gas Corporation
|
186.34
|
112.60
|
111.71
|
113.36
|
State Bank of India
|
146.23
|
420.90
|
417.54
|
425.64
|
ICICI Bank
|
131.69
|
641.90
|
636.91
|
649.06
|
Wipro has sold its entire stake in IntSights Cyber Intelligence, a cyberthreat intelligence service provider, for a consideration of $19.17 million.
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