Indian equity benchmarks
witnessed steep selling pressure on Friday dragged down by Utilities, Power and
Oil & Gas shares. Headline indices made a gap down opening and remained
under pressure throughout the session amid continuous foreign fund outflows.
Foreign Institutional Investors (FIIs) offloaded shares worth Rs 2,393.94 crore
on Wednesday, according to exchange data. Sentiments were down-beat with a
United Nations' report stating that global economic growth is projected to slow
to 1.9% this year from an estimated 3% in 2022. The report blamed the COVID-19
pandemic, Russia's war in Ukraine, high inflation and the climate crisis. It
said this would mark one of the lowest growth rates in recent decades.
Investors also turned cautious ahead of the Union Budget 2023, which will be
presented by Finance Minister Nirmala Sitharaman on February 1. Markets
extended fall in afternoon deals, as traders were anxious with a private report
stating that private equity (PE) and venture capital (VC) investments in
Asia-Pacific excluding Japan continued their downward trajectory when 2022
closed. According to data from S&P Global Market Intelligence, deals totaled
$5.39 billion across 42 announced and completed transactions in the fourth
quarter of 2022, compared to $20.07 billion across 79 transactions in the same
period in 2021. Traders also took a note of a study by market regulator SEBI
showing that nine out of 10 individual traders in the equity F&O segment
incurred net losses during both the years FY 2018-19 and FY 2021-22. There has
been a significant increase of over 500 per cent in the number of individual
traders in the equity F&O segment in FY 2021-22, as compared to FY 2018-19.
Finally, the BSE Sensex fell 874.16 points or 1.45% to 59,330.90 and the CNX
Nifty was down by 287.60 points or 1.61% to 17,604.35.
The US markets ended higher on
Friday, boosted by hopes that inflation is moderating. Meanwhile, traders
looked ahead to the Federal Reserve's highly anticipated monetary policy
meeting next week. With the Fed widely expected to slow the pace of interest
rate hikes to 25 basis points, traders will pay close attention to the
accompanying statement for clues about the outlook for further rate hikes.
Recent upbeat economic data has generated some optimism the Fed could engineer
a soft landing but has also led to concerns the central bank will need to keep
rates at elevated levels for longer than anticipated. Besides, all the major
averages posted a positive week and are on pace for a month of gains. On the
sectoral front, Transportation stocks showed a strong move to the upside on the
day, driving the Dow Jones Transportation Average up by 1.3 percent. Notable
strength was also visible among retail stocks, as reflected by the 1.2 percent
gain posted by the Dow Jones U.S. Retail Index. The index reached its best
closing level in three months. On the U.S. economic front, the Commerce
Department released a report showing personal income increased in line with
street estimates in the month of December. The report said personal income
inched up by 0.2 percent in December after rising by a downwardly revised 0.3
percent in November. Street had expected personal spending to edge up by 0.2
percent compared to the 0.4 percent increase originally reported for the
previous month. Meanwhile, the Commerce Department said personal spending
dipped by 0.2 percent in December after slipping by 0.1 percent in November.
The modest decrease matched street estimates. The report also said core
consumer prices, which exclude food and energy prices, rose by 0.3 percent in
December after inching up by 0.2 percent in November. The inflation reading,
which is said to be preferred by the Fed, was expected to show another 0.2
percent uptick.
Crude oil futures ended lower on
Friday on uncertainty about the outlook for oil demand. Profit taking after
recent gains and indications that oil supply from Russia will see a surge
weighed on oil prices. Meanwhile, OPEC and allies are scheduled to meet next
week to review crude production levels. The Federal Reserve's monetary policy
meeting, scheduled to take place on January 31 and February 1 is eyed as well.
However, oil prices rose earlier in the session, riding on hopes about Chinese
economic growth, and data showing a stronger than expected increase in U.S.
GDP. Benchmark crude oil futures for March delivery fell $1.33 or 1.6 percent
at $79.68 a barrel on the New York Mercantile Exchange. Brent crude for March
delivery dropped $1.09 or 1.25 percent at $86.38 (Provisional) a barrel on
London's Intercontinental Exchange.
Indian rupee settled higher
against dollar on last trading day of week despite weak domestic equities.
Sentiments were positive even as United Nations' report said that global
economic growth is projected to slow to 1.9% this year from an estimated 3% in
2022. The report blamed the COVID-19 pandemic, Russia's war in Ukraine, high
inflation and the climate crisis. It said this would mark one of the lowest
growth rates in recent decades. On the global front, dollar edged up on Friday
to pull away from multi-month lows against the euro and sterling, as investors
began to train their sights on a slew of major central bank meetings next week.
Finally, the rupee ended at 81.53 (Provisional), stronger by 8 paise from its
previous close of 81.61 on Wednesday.
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 8101.95 crore against gross selling of Rs
8358.45 crore, while in the debt segment, the gross purchase was of Rs 1631.68
crore against gross selling of Rs 702.58 crore. Besides, in the hybrid segment,
the gross buying was of Rs 4.12 crore against gross selling of Rs 5.75 crore.
The US markets ended higher on
Friday as a slew of economic data boosted optimism about the overall health of
the world's largest economy. Asian markets are trading mostly in green on
Monday as investors looked ahead to the interest rate decisions from the
Federal Reserve, the European Central Bank and the Bank of England this week.
Indian markets tumbled on Friday as Adani group shares and several bank stocks
fell sharply on sustained selling right through the day's session. Today,
markets are likely to get positive start on firm global cues. Investor will be
eyeing the Union Budget to be presented later in the week. Some support will
come as latest data showed that the Reserve Bank of India's (RBI's) foreign
exchange reserves climbed $1.7 billion to $573.73 billion in the week ended
January 20. The rise was on account of
an increase in the RBI's foreign currency assets as well as its gold holdings.
Traders may take note of report that Union Minister for Commerce and Industry,
Piyush Goyal called for creation of an international network of mentors,
investors and entrepreneurs to strengthen the global startup ecosystem.
However, there may be some cautiousness with report that foreign investors have
pulled out a net of over Rs 17,000 crore this month so far due to the
attractiveness of the Chinese markets and the cautious stance adopted by them
ahead of the Union Budget and US Federal Reserve meeting. Meanwhile, the
Commerce Ministry has the recommended imposition of anti-dumping duty on vinyl
tiles coming from China and Taiwan for five years to guard domestic players
from cheap imports from these countries. There will be some buzz in the pharma
sector stocks with a private report that strong domestic demand and exports to
semi-regulated markets are expected to drive revenue growth for the
pharmaceuticals sector in the current fiscal year (FY23), though export demand
from regulated markets is expected to remain moderate owing to high pricing
pressure amid intense competition. Oil industry stocks will be in focus with
provisional government data showing that Indian refiners' crude oil processing
in December rose about 4% from a year earlier, in line with elevated demand in
the world's third-biggest oil importer and consumer. There will be some
reaction in banking stocks as latest data released by Reserve Bank of India
(RBI) showed after a slight moderation in growth in the previous fortnight,
bank credit growth picked up in the fortnight ended January 13, 2023, with 16.5
per cent YoY growth to Rs 132.81 trillion. Also, investors will be eyeing
results from many companies including Larsen & Toubro, Tech Mahindra,
Bharat Petroleum Corporation, Bajaj Finserv, Exide Industries, GAIL (India),
Punjab National Bank, REC, SRF, Trident, and Welspun India later in the day for
more cues. Besides, newsflow around the Adani-Hindenburg case will further
drive the sentiment.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,604.35
|
17,437.01
|
17,828.21
|
BSE
Sensex
|
59,330.90
|
58,814.76
|
60,006.96
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Adani Ports & Special Economic Zone
|
641.94
|
604.50
|
527.71
|
690.56
|
Tata Motors
|
633.60
|
445.25
|
435.80
|
454.05
|
Tata Steel
|
587.71
|
120.65
|
118.75
|
122.90
|
State Bank of India
|
401.63
|
542.00
|
526.65
|
562.95
|
ICICI Bank
|
397.18
|
818.25
|
806.56
|
836.46
|
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