Indian equity benchmarks made
smart recovery on Tuesday, after witnessing massacre in the previous session,
led by gains in information technology heavyweights like HCL Technologies, Tech
Mahindra and Infosys. Soon after making a positive start, key gauges entered
into red terrain as traders turned pessimistic amid reports of new strains of
coronavirus in the UK. Rising corona virus cases too dampened sentiments with
increase in Covid-19 cases, India's caseload now stands at 10,075,422 and the
country's death toll has mounted to 146,145. Cautiousness also crept in on
report that Maharashtra government imposed a curfew from 11 pm to 6 am in all
municipal corporations from December 22 till January 5, 2021. Markets took
U-turn in second half of the trade to end near intraday highs, as traders opted
to buy beaten down but fundamentally strong stocks. Traders took encouragement
with CRISIL's report that corporate profits rose 15 per cent to touch an
all-time high in the September quarter as margins widened on softer input costs
and better utilistaion levels. Some support also came as economic think-tank
NCAER, in its mid-year review of the Indian economy, has said that India's
Gross Domestic Product (GDP) growth is likely to turn positive at 0.1 per cent
in the October-December (Q3) quarter, after witnessing a contraction in the
first half of the current financial year. It also forecast 2 per cent growth in
the fourth quarter (January-March 2021). It noted that the overall contraction
in the current fiscal is likely to be contained at 7.3 per cent. Adding to the
optimism, Ministry of Finance has released the 8th weekly installment of Rs
6,000 crore to the states. Out of this, an amount of Rs 5,516.60 crore has been
released to 23 states and an amount of Rs 483.40 crore has been released to the
3 Union Territories (UT) with Legislative Assembly (Delhi, Jammu & Kashmir
& Puducherry) who are members of the GST Council. Finally, the BSE Sensex
rose 452.73 points or 0.99% to 46,006.69, while the CNX Nifty was up by 137.90
points or 1.03% to 13,466.30.
The US markets ended mostly lower
on Tuesday amid uncertainty about the near-term outlook for the markets
following the recent run to record highs. Reports about a new coronavirus
strain generated some negative sentiment, although news of the approval of a
new stimulus bill helped prop up the markets. The $900 billion relief package
includes federal assistance for the unemployed, small businesses and healthcare
providers as well as $600 in direct payments to individuals. The relief package
was attached to a $1.4 trillion government spending bill that funds the
government through September 30th. The bill is expected to be signed by
President Donald Trump in the coming days. On the economic data front, the
Commerce Department released revised data showing the US economy grew by
slightly more than previously estimated in the third quarter of 2020. The
report showed the spike in gross domestic product in the third quarter was
upwardly revised to 33.4 percent from the previously reported 33.1 percent.
Street had expected the jump in GDP to be unrevised. The Commerce Department
said the unexpected upward revision primarily reflected larger increases in
consumer spending and non-residential fixed investment. Meanwhile, the National
Association of Realtors released a separate report showing existing home sales
pulled back in the month of November. NAR said existing home sales tumbled by
2.5 percent to an annual rate of 6.69 million in November after jumping by 4.4
percent to a revised rate of 6.86 million in October. Street had expected
existing home sales to slump by 2.2 percent to a rate of 6.70 million from the
6.85 million originally reported for the previous month.
Crude oil settled lower on
Tuesday, extending their previous session's losses, amid rising worries about
the outlook for energy demand due to new restrictions on travel following a
surge in coronavirus cases. Despite the rollout of a vaccine, worries about
virus infections continue following the detection of a new variant of the
coronavirus in the UK. More than 40 countries have banned UK arrivals amid
fears over the coronavirus mutation that was first identified in Britain. Crude
oil futures for February fell $0.95 or 2 percent to settle at $47.02 a barrel
on the New York Mercantile Exchange. February Brent crude dropped $0.83 or 1.6
percent to settle at $50.08 a barrel on London's Intercontinental Exchange.
Tumbling for second straight
session, Rupee ended weaker against dollar on Tuesday amid cautiousness on
renewed fears of a highly infectious new strain of COVID-19. Traders took note
of private report that rupee is probably end calendar year 2020 as the worst
performing currency in Asia, even underperforming minor South Asian currencies
such as the Pakistani rupee and Sri Lankan rupee. However, downfall remained
capped as economic think-tank NCAER, in its mid-year review of the Indian
economy, has said that India's Gross Domestic Product (GDP) growth is likely to
turn positive at 0.1 per cent in the October-December (Q3) quarter, after
witnessing a contraction in the first half of the current financial year. On
the global front, euro and the pound were on the defensive against the dollar
on Tuesday as a new coronavirus strain spread across Britain, closing key trade
routes and creating a supply-chain nightmare while time was running out to
strike a post Brexit trade deal. Finally, the rupee ended at 73.84, 5 paise
weaker from its previous close of 73.79 on Monday.
The FIIs as per Tuesday's data
were net buyer in equity segment, while net seller in debt segment. In equity
segment, the gross buying was of Rs 6870.70 crore against gross selling of Rs
6847.83 crore, while in the debt segment, the gross purchase was of Rs 483.67
crore with gross sales of Rs 1305.01 crore. Besides, in the hybrid segment, the
gross buying was of Rs 6.42 crore against gross selling of Rs 17.69 crore.
The US markets ended mostly lower
on Tuesday over concerns the new COVID variation, which has halted movement in
and out of the UK and sent vaccine makers scrambling to ensure their drugs are
effective against it, could further hamper a softening economic recovery. Asian
markets are trading mixed on Wednesday as the investor focus swung between
concerns about a new faster-spreading variant of the coronavirus and hopes that
more US fiscal aid would propel an economic recovery. Indian markets witnessed
a sharp recovery to end 1 percent higher on Tuesday led by robust buying in IT
and pharma stocks. Today, the start of session is likely to be pessimistic
tracking weakness in global peers. Rising coronavirus cases to dent the
sentiments in markets. With 19,174 fresh Covid-19 cases, India's caseload now
stands at 10,099,303. The country's death toll has mounted to 146,476. At least
20 passengers from the UK tested positive for Covid-19 on Tuesday as the
government issued a stringent set of SOPs mandating RT-PCR tests at airports for
each traveller from the country and isolation in a separate unit of an
institutional facility for positive cases in view of the new coronavirus
strain. However, investors may get some solace from a private report that India
is likely to approve Oxford/AstraZeneca's coronavirus vaccine for emergency use
by next week after its local manufacturer submitted additional data sought by
authorities. Traders may be taking encouragement with PHD Chamber of Commerce
and Industry's EBM Index showing that the continuous improvement in the key
economic and business indicators signals that the worst is behind us and
expectations of positive GDP growth at 0.1 per cent to 2 per cent in Q3 and 2
per cent to 4 per cent in Q4 FY 2020-21 are becoming strong with a higher growth
trajectory in FY 2021-22 at 7.7 per cent. Some support may come with Commerce
and Industry Minister Piyush Goyal's statement that India and Bangladesh should
work with greater collaboration in the agriculture sector as it can be a
game-changer for both the countries. Meanwhile, the government has again
extended the suspension of fresh proceedings under the insolvency law by three
more months amid the disruptions caused by the coronavirus pandemic. There will
some buzz in agriculture sector stocks with report that paddy procurement has
increased 22 per cent so far in the ongoing kharif marketing season to 422.01
lakh tonnes, valued at Rs 79,675 crore. NBFCs and HFCs stocks will be in focus
with ICRA's report that after witnessing a sharp contraction in the current
fiscal so far, the domestic securitisation volumes of retail pools originated
by non-banking financial companies (NBFC) and housing finance companies (HFC)
are likely to witness a healthy bounce back in FY2022.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
13,466.30
|
13,275.45
|
13,574.60
|
BSE
Sensex
|
46,006.69
|
45,385.86
|
46,353.85
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata
Motors
|
1,100.09
|
164.95
|
158.04
|
170.54
|
Oil
& Natural Gas Corporation
|
586.03
|
90.55
|
87.34
|
93.04
|
State
Bank of India
|
511.89
|
257.45
|
250.90
|
261.35
|
Gail
India
|
435.17
|
118.50
|
113.90
|
121.85
|
ITC
|
409.86
|
203.40
|
198.11
|
207.46
|
Coal India has allocated 25.78 MT of coal in the first eight months of this fiscal under spot e-auction scheme, registering a year-on-year increase of 59.4 per cent.
Tata Motors is going to increase prices across its commercial vehicle range, effective January 01, 2021.
Bajaj Finserv Group is offering customers a hassle-free shopping experience via its EMI Store.
ICICI Bank has launched an online platform for foreign companies looking to establish or expand business in the country.