Indian equity
benchmarks rebounded from early lows to close over a per cent higher on
Tuesday, helped by heavy buying in index heavyweights Tech Mahindra, Reliance
Industries and Bajaj Finserv amid gains in global equities. After making
cautious start, domestic markets traded in the red for most part of the
session, as traders were worried as rating agency Fitch in its Global economic
Outlook-March 2022 has slashed India's growth forecast for the next fiscal to
8.5 per cent from 10.3 per cent. The agency slashed India's growth forecast on
account of sharply higher energy prices. Some concern also came after Reserve
Bank of India (RBI) Governor Shaktikanta Das said that all COVID-related
liquidity relief measures extended by the central bank have come with a sunset
date and would be withdrawn in due course. Some pessimism also came as foreign
institutional investors (FIIs) were net sellers in the capital market, as they
sold shares worth Rs 2,962.12 crore on Monday. However, the domestic bourses
recovered from intraday losses during late deals to end higher, taking support
from Reserve Bank Governor Shaktikanta Das' statement that the RBI will
continue to ensure adequate liquidity to support the economy, which is facing many
headwinds in the form of soaring crude oil and key commodity prices following
the Russian invasion of Ukraine. Some support also came as Commerce and
Industry Minister Piyush Goyal stating that several ministries, which are
related to e-commerce, are deliberating on the e-commerce policy draft and it
will be put out in the public domain after discussions. Meanwhile,
Parliamentary panel has suggested that the government should extend the period
of repayment of loans under the Emergency Credit Line Guarantee Scheme (ECLGS)
for the MSME sector. The Parliamentary standing committee on industry has also
asked the government to digitize the GST system to ensure paperless refund of
claims. Finally, the BSE Sensex rose 696.81 points or 1.22% to 57,989.30 and the
CNX Nifty was up by 197.90 points or 1.16% to 17,315.50.
The US markets ended higher on
Tuesday as stocks resumed the strong upward move seen last week following a
brief pause in the recovery rally on Monday. Wall Street benefited from
strength in the overseas markets, which largely shrugged off Federal Reserve
Chair Jerome Powell's comments suggesting the central bank may raise interest
rates more aggressively. Powell said the Fed could raise rates by more than 25
basis points at upcoming meetings if necessary to ensure a return to price
stability. The Dow had closed higher for five consecutive sessions before
Monday's drop, while the Nasdaq had soared more than 9 percent after hitting
its lowest closing level in over a year last Monday. On the sectoral front,
airline stocks showed a substantial rebound following the pullback seen in the
previous session, with the NYSE Arca Airline Index soaring by 2.5 percent. A
continued spike by treasury yields also contributed to significant strength
among financial stocks, driving the KBW Bank Index and the NYSE Arca
Broker/Dealer Index up by 2.3 percent and 2.2 percent, respectively. Tobacco
stocks also turned in a strong performance after ending yesterday's trading
sharply lower, resulting in a 1.4 percent advance by the NYSE Arca Tobacco
Index. Biotechnology, retail and computer hardware stocks have also moved to
the upside on the day, while gold and oil stocks moved lower along with the
prices of the associated commodities.
Crude oil futures ended lower on
Tuesday on reports that European Union foreign ministers are split on the issue
of banning Russian oil. Traders chose to book profits amid concerns over demand
due to a surge in Covid-19 cases in China. Further, oil was also weighed down
by a steady dollar after Federal Reserve Chair Jerome Powell hinted at tighter
monetary policy to rein in inflation. Benchmark crude oil futures for April
delivery fell $0.36 or 0.3 percent to settle at $111.76 a barrel on the New
York Mercantile Exchange. Brent crude for May delivery dropped $0.16 or 0.15
percent to settle at $115.46 a barrel on London's Intercontinental Exchange.
Indian rupee pared its initial
losses to settle flat against the American currency on Tuesday, tracking a
positive trend in domestic equities. During the day, the local unit witnessed
heavy volatility amid concerns over global oil supplies. Traders took note of
reports that US Federal Reserve Chairman Jerome Powell said that the central
bank will, if required, move more aggressively to raise federal funds rate by
more than 25 basis points at its policy meetings in an effort to curb
inflation. On the global front, pound strengthened to a nine-day high against
the euro on Tuesday as it continues to retrace losses seen after the European
Central Bank and Bank of England policy decisions in the last two weeks. Finally,
the rupee ended flat (Provisional) from its previous close of 76.18 on Monday.
The FIIs as per Tuesday's data
were net sellers in equity segment, while net buyers in debt segment. In equity
segment, the gross buying was of Rs 6829.78 crore against gross selling of Rs 9692.49
crore, while in the debt segment, the gross purchase was of Rs 650.62 crore
against gross sales of Rs 343.57 crore. Besides, in the hybrid segment, the
gross buying was of Rs 5.22 crore against gross selling of Rs 17.01 crore.
The US markets ended higher on
Tuesday as investors digested Fed Chair's hawkish remarks. Asian markets are
trading in green on Wednesday tracking a surge in Wall Street indices
overnight. Indian markets made a smart recovery in the second half of a choppy
session on Tuesday, led by gains in IT, financial, oil & gas and auto
shares. Today, the start of session is likely to be optimistic following firm
global cues. Investors are likely to continue monitoring developments on the
Russia-Ukraine conflict, which has now continued for an entire month. Traders
will be taking encouragement as a periodic labour force survey by the National
Statistical Office (NSO) showed that unemployment rate for persons of age 15
years and above in urban areas dipped to 9.8 per cent in July-September 2021
from 13.2 per cent in the same quarter of the previous year. Some support will
come as the Organization for Economic Cooperation and Development (OECD)
retained the outlook for India's real gross domestic product (GDP) at 5.5% in
FY24. Traders may take note of report that NITI Aayog sought to dispel the fear
that India is favouring a closed economy by promoting Atmanirbhar mission, and
said the country can achieve better results for its people by having a deeper
engagement with the global supply and value chain. Meanwhile, a parliamentary
panel has appreciated the government's efforts to cut the food subsidy bill but
said it is still very high and there is scope for further reduction. The
Standing Committee on Food, Consumer Affairs and Public Distribution tabled a
report in the Lok Sabha on March 22, 2022. OMCs will be in focus as petrol and
diesel prices were raised by around 80 paise a litre for the second straight
day on March 23. The oil marketing companies (OMCs) increased the petrol retail
price by 75 paise a litre and diesel by 76 paise. In two days, the prices of
retail fuel have gone up by close to Rs 1.80 a litre each. There will be some
reaction in oil & gas sector stocks as the Ministry of Petroleum and
Natural Gas released its monthly production report for February 2022 showed
that crude oil production failed to meet target while also lower in terms of
year-on-year (YoY) data for the period; while natural gas production was higher
in YoY terms, but still lower than the monthly target.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,315.50
|
17,103.06
|
17,431.16
|
BSE
Sensex
|
57,989.30
|
57,262.11
|
58,384.68
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Oil & Natural Gas Corporation
|
397.42
|
175.50
|
172.45
|
179.90
|
ITC
|
369.45
|
249.95
|
245.41
|
252.61
|
Tata Motors
|
304.41
|
440.85
|
427.55
|
447.80
|
State Bank of India
|
261.57
|
495.10
|
482.96
|
501.51
|
Indian Oil Corporation
|
206.19
|
120.55
|
118.75
|
122.10
|
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