Indian equity
benchmarks traded volatile and ended marginally in the green on Monday, helped
by gains in heavyweight financial stocks such as SBI, Larsen & Toubro and
Axis Bank. Traders took some support as India reported Covid-19 cases below the
250,000-mark for the second consecutive. The fresh caseload stood at 2.4 lakh.
Amid a drop in cases, a few states have hinted at the possibility of easing
lockdown from next month onwards. Some support also came in with a private
report stating that the RBI surprised the Centre with a record Rs 99,122 crore
in surplus transfer for FY21 and this will help the government tide over the
revenue losses from lockdowns and extend more support to the pandemic hit
industries and to the poor people. Traders also got relief after industry body
Assocham has demanded from the government a 'concentrated and right kind' of
relief package for MSME sector, which was most affected by covid-19 pandemic.
Besides, RBI data showed the country's foreign exchange reserves rose by $563
million to reach $590.028 billion in the week ended May 14. However, gains
remain capped as some concern came with rating agency ICRA stating that
slackening economic momentum driven by the second wave of Covid-19 infections
in India has emerged as a concern with bruised sentiment, high healthcare costs
and fuel expenses likely to limit discretionary purchases in the immediate
term. Some anxiety also came as overseas investors withdrew Rs 4,444 crore from
Indian markets in May so far amid concerns over the second wave of the
coronavirus pandemic and its possible impact on the Indian economy. Traders
also took a note of report that the GST Council is its upcoming meeting,
scheduled to be held on May 28, is likely to take a call on levy of 12 per cent
tax on import of oxygen concentrators for personal use. Finally, the BSE Sensex
rose 111.42 points or 0.22% to 50,651.90, while the CNX Nifty was up by 22.40
points or 0.15% to 15,197.70.
The US markets
ended higher on Monday with the tech-heavy Nasdaq showing a particularly strong
advance. Economic optimism contributed to the buying interest on markets, as
the country continues to reopen following the coronavirus pandemic. Covid cases
in the US have dropped to their lowest level since June as the nation prepares
for Memorial Day weekend. The seven-day average of new infections is about
26,000 as of Sunday. Reopening plays saw notable strength on the day along with
technology stocks, which benefited from a rebound in the value of bitcoin. Besides,
semiconductor stocks moved sharply higher over the course of the session,
driving the Philadelphia Semiconductor Index up by 2.3 percent. Considerable
strength was also visible among software stocks, as reflected by the 2 percent
jump by the Dow Jones US Software Index. Computer hardware stocks also turned
in a strong performance on the day, with the NYSE Arca Computer Hardware Index
climbing by 1.6 percent.
Crude oil futures ended sharply
higher on Monday as inconclusive negotiations with Iran on the nuclear deal
issue and reports forecasting a possible hurricane in the Gulf of Mexico eased
concerns about any excess supply in the market. Further, a weak dollar, and
expectations of a surge in energy demand amid easing travel restrictions in the
US and Europe supported oil's uptick. Besides, recent upbeat data like strong
manufacturing and services sector reports from the US and some major European
economies helped as well. Crude oil futures for July surged $2.47 or about 3.9
percent to settle at $66.05 barrel on the New York Mercantile Exchange. July
Brent crude jumped $1.97 or nearly 3 percent to settle at $68.32 a barrel on
London's Intercontinental Exchange.
Erasing previous sessions' gains,
Indian rupee ended considerably lower against dollar on Monday, on account of
sustained dollar demand from importers and banks. Investors' sentiments were
dented as ICRA stated that slackening economic momentum driven by the second
wave of Covid-19 infections in India has emerged as a concern with bruised
sentiment, high healthcare costs and fuel expenses likely to limit
discretionary purchases in the immediate term. Adding more pessimism, overseas
investors withdrew Rs 4,444 crore from Indian markets in May so far amid
concerns over the second wave of the coronavirus pandemic and its possible
impact on the Indian economy. On the global front; dollar was pinned near
three-month lows against a basket of major currencies on Monday, as bets on a
robust global economic recovery continued to support currencies seen as
riskier. Finally, the rupee ended 72.96, weaker by 13 paise from its previous
close of 72.83 on Friday.
The FIIs as per Monday's data
were net buyer in equity segment, while net seller in debt segment. In equity
segment, the gross buying was of Rs 7720.45 crore against gross selling of Rs
7388.04 crore, while in the debt segment, the gross purchase was of Rs 221.44
crore with gross sales of Rs 513.20 crore. Besides, in the hybrid segment, the gross
buying was of Rs 86.37 crore against gross selling of Rs 75.35 crore.
The US markets ended higher on
Monday as investors regained an appetite for risk following two straight weeks
of losses. Asian markets are trading in green on Tuesday following overnight
gains on Wall Street. Indian markets ended Monday's volatile session on a
positive note led by gains in banking and financial stocks. Today, the start of
session is likely to be optimistic tracking firm global cues coupled with fall
in fresh coronavirus cases in the country. India continued to record steady
decline in the number of fresh coronavirus cases with the daily toll slipping
below the 200,000-mark. India's fresh Covid cases stood at 1.95 lakh. It is the
lowest level of cases in the last 41 days. Traders will be taking encouragement
with the commerce and industry ministry's statement that foreign direct
investments (FDI) into the country grew 19 per cent to $59.64 billion during
2020-21 on account of measures taken by the government on the fronts of policy
reforms, investment facilitation and ease of doing business. Some support will
come as RBI data showed bank credit grew by 6.02 per cent to Rs 108.69 lakh
crore and deposits increased by 9.87 per cent to Rs 152.17 lakh crore in the
fortnight ended May 7, 2021. Traders may take note of report that a Reserve
Bank of India (RBI) study has advocated a mix of fiscal and monetary policies
to mitigate economic downturn, saying demand side channel needs to be
complemented with a conducive monetary transmission mechanism from the supply
side. However, there may be some cautiousness as domestic ratings agency Icra
forecast a 2 per cent GDP growth in the fourth quarter of 2020-21, and a 7.3
per cent contraction for the full fiscal year. From a GVA or gross value added
perspective, the agency pegs Q4 growth at 3 per cent and the full year contraction
at 6.3 per cent. There will be some buzz in banking stocks as the Reserve Bank
said it will consider amalgamation of District Central Co-operative Banks
(DCCBs) with State Cooperative Banks (StCBs) subject to various conditions,
including that a proposal should be made by the state government concerned.
Aviation stocks will be in focus with ICRA's report that the second wave of the
coronavirus pandemic is likely to delay recovery in air passenger traffic with
an 80-85 per cent growth year-on-year this fiscal against the earlier estimate
of 130-135 per cent. There will be some reaction in jewellery industry stocks
as the Centre further extended the deadline for mandatory hallmarking of gold
jewellery and artefacts by a fortnight till June 15 in view of the COVID-19
pandemic. There will be some earnings announcements too to keep the markets
buzzing.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
15,197.70
|
15,143.35
|
15,254.15
|
BSE
Sensex
|
50,651.90
|
50,459.33
|
50,851.02
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
State
Bank of India
|
1,429.64
|
412.05
|
405.16
|
419.06
|
Indian
Oil Corporation
|
831.99
|
109.45
|
106.34
|
111.24
|
Tata
Motors
|
319.63
|
311.85
|
309.44
|
315.04
|
ITC
|
288.65
|
211.50
|
208.81
|
213.11
|
Oil
& Natural Gas Corporation
|
247.85
|
113.05
|
111.29
|
114.39
|
Dr Reddy's Laboratories is working on the development of new treatment options for COVID-19 patients which it aims to launch over the next few months.
M&M has extended the warranty and service period on its entire range of vehicles till July 31 due to lockdown in several states in the wake of the pandemic.
L&T has intensified its efforts to retain its workforce post the outbreak of the second COVID-19 wave.
Bharti Airtel's network is fully ready for 5G and it also deployed additional spectrum in Karnataka and Tamil Nadu to boost network quality.