Indian equity
benchmarks wiped out entire intraday gains and ended marginally lower on
Wednesday, as investors booked profits at higher levels. The benchmarks traded
on a positive note for most part of the day, as traders took encouragement with
Chief Economic Adviser (CEA) K V Subramanian's statement that a number of
reforms undertaken by the government in the last one year especially focused on
removing supply side frictions are expected to spur investment, including
foreign investment. Sentiments remained positive as Finance Minister Nirmala
Sitharaman exhorted ministries to aim to achieve more than their capital
expenditure (capex) targets for this fiscal, highlighting that enhanced spending
will play a critical role in revitalising the economy post-pandemic. Some
support also came as the Union Cabinet may soon clear a proposal to provide
government guarantee to security receipts issued by the National Asset
Reconstruction Company (NARCL) as part of resolution of bad loans. Indian
Banks' Association (IBA), entrusted with the task of setting up a bad bank, has
pegged the government guarantee to be around Rs 31,000 crore. However, key
gauges gave up gains during closing hours, as traders got anxious with the
Reserve Bank of India's (RBI) data showing that credit growth to the industrial
sector remained in the negative territory during 2020-21, mainly due to the
COVID-19 pandemic and resultant lockdowns. It said personal loans continued to
grow at robust pace and recorded 13.5 per cent growth (Y-o-Y) in March 2021;
industrial loan growth, on the other hand, remained negative during all
quarters of 2020-21. Some cautiousness also came as a day after witnessing a
sharp decline in the number of daily Covid-19 cases, India recorded 45,699
infections and 816 fatalities in the last 24 hours. The country's total
coronavirus caseload stands at 30,316,000, while the death toll has jumped to
397,668. Traders took a note of minister for MSME and Road Transport and
Highways Nitin Gadkari's statement that the Manufacturing sector needs to be
strengthened for employment generation and eradicate poverty. Finally, the BSE
Sensex fell 66.95 points or 0.13% to 52,482.71, while the CNX Nifty was down by
26.95 points or 0.17% to 15,721.50.
The US markets ended mostly
higher on Wednesday as optimism about strong economic recovery outweighed concerns
about inflation and possibility of interest rate hikes happening next year.
Investors reacted to data on private sector employment, pending home sales and
the reading on Chicago Business Barometer, and looked ahead to crucial non-farm
payrolls data, due on Friday. Data from Automatic Data Processing, Inc. (ADP)
showed private business in the US hired 692,000 workers in the month of June,
higher than an expected addition of 600,000. However, the hiring in June was
much below a downwardly revised 886,000 job additions in May. Data released by
the National Association of Realtors (NAR) showed pending home sales in the US
increased by 13.1% year-on-year in May, after soaring by a record 51.7% in
April. Meanwhile, according to a report released by the Institute for Supply
Management (ISM), the MNI Chicago Business Barometer came in with a reading of
66.1 for June, down from a score of 75.2 in the previous month. Though, the
surge in infections due to the delta variant of the coronavirus, and curbs on travel
in several countries raised some uncertainty about the pace of global economic
rebound and rendered the mood cautious.
Crude oil futures ended higher on
Wednesday lifted by data showing weekly drop in US crude inventories. Data
released by Energy Information Administration (EIA) showed crude inventories in
the US dropped by 6.7 million barrels in the week ended June 25, much higher
than an expected drop of 4.7 million barrels. A report released by the American
Petroleum Institute (API) on Tuesday that crude stockpiles in the US dropped by
about 8.2 million barrels last week. Meanwhile, traders also looked ahead to
the decision of the Organization of the Petroleum Exporting Countries (OPEC)
and its allies, collectively known as OPEC+, with regard to increasing crude
production from August. The OPEC+ will announce its decision on Thursday. Crude
oil futures for August rose $0.49 or about 0.7 percent to settle at $73.47
barrel on the New York Mercantile Exchange. September Brent crude gained $0.34
or 0.5 percent to settle at $74.62 a barrel on London's Intercontinental
Exchange.
Indian rupee ended weaker against
dollar on Wednesday, on emergence of demand for the greenback from importers.
Sentiments were downbeat as Reserve Bank of India in its latest data has showed
that credit growth to the industrial sector remained in the negative territory
during 2020-21, mainly due to the COVID-19 pandemic and resultant lockdowns. It
said personal loans continued to grow at robust pace and recorded 13.5 per cent
growth (Y-o-Y) in March 2021; industrial loan growth, on the other hand,
remained negative during all quarters of 2020-21. On the global front, dollar
was heading for its biggest monthly rise since March on Wednesday, supported by
traders' trepidation ahead of unpredictable U.S. labour data and concern over
the spread of the Delta coronavirus variant. Finally, the rupee ended 74.32,
weaker by 9 paise from its previous close of 74.23 on Tuesday.
The FIIs as per Wednesday's data
were net buyer in equity segment, while net seller in debt segment. In equity
segment, the gross buying was of Rs 10595.11 crore against gross selling of Rs
7304.94 crore, while in the debt segment, the gross purchase was of Rs 404.99
crore with gross sales of Rs 894.57 crore. Besides, in the hybrid segment, the
gross buying was of Rs 92.02 crore against gross selling of Rs 94.20 crore.
The US markets ended mostly
higher on Wednesday continuing its comeback from a steep drop in early 2020 at
the onset of the coronavirus pandemic. Asian markets are trading mixed on
Thursday as investors await the release of Chinese economic data. Indian
markets pared morning gains and ended in the red on Wednesday weighed by
banking and financial stocks as they fell sharply from the day's high. Today,
the markets are likely to make flat-to-positive start of new month amid mixed
macroeconomic data and lackluster global cues. Investors are looking ahead to
the manufacturing PMI data to be out later in the day. Sentiments will get a
boost as Principal Economic Adviser (PEA) Sanjeev Sanyal said the Indian
economy is likely to witness close to double-digit growth in the current fiscal
year despite the second Covid-19 wave ravaging the country. Some support will
come as data released by the RBI showed India reported a current account
surplus of 0.9 percent of GDP in the pandemic-hit FY21, as against a deficit of
0.9 percent in FY20. Additionally, the
finance ministry retained the interest rate on small savings schemes for the
September quarter. The scheme will continue to fetch small investors better
rates than other fixed income avenues such as bank fixed deposits (FDs).
Traders may take note of report that India's fiscal deficit in April-May stood
at 8.2 per cent of the budget estimates (BE), as compared to 59 per cent in the
same period last year. The deficit was less 30 per cent less of last-year's
level of Rs. 4.7 trillion amid the nationwide lockdown to contain the
coronavirus. However, there may some cautiousness as with second wave nowhere
close to waning, India recorded 48,878 infections and 991 fatalities in the
last 24 hours. The country's total coronavirus caseload stands at 30,410,577, while
the death toll has jumped to 399,475. Besides, India's eight core sectors grew
16.8% year-on-year in May compared to April's 60.9% jump on account of a weak
base the same period last year when factories shut due a nationwide lockdown
for coronavirus. Auto stocks will be buzzing the today's session reacting to
their monthly sales data, amid expectations of sequential improvement. Power
stocks will be in focus as the Union Cabinet Committee of Economic Affairs gave
its nod to a new scheme for revival of the power distribution sector in India.
This is the second reform scheme for power distribution companies (discoms)
announced by the BJP government, a year after the ambitious UDAY scheme
concluded. There will be some reaction in hospitality industry stocks with
ICRA's report that the second wave of the coronavirus pandemic has derailed the
recovery of the hospitality industry, which is now expected to return to
pre-Covid levels only in 2023-24. Banking stocks will be in limelight as
Standard and Poor's (S&P) said Indian banks face systemic risks as the
country wades through the aftermath of the Covid-19 second wave. A separate
report stated that banks will now have to surrender current accounts of all
companies or corporate borrowers, where their loan exposure is less than 10
percent of the total approved facilities.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
15,721.50
|
15,673.80
|
15,804.15
|
BSE
Sensex
|
52,482.71
|
52,328.92
|
52,756.20
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Oil & Natural Gas Corporation
|
190.94
|
117.70
|
116.19
|
120.09
|
State Bank of India
|
183.37
|
419.20
|
416.70
|
423.30
|
Tata Motors
|
182.77
|
339.60
|
337.19
|
343.69
|
NTPC
|
167.39
|
116.40
|
115.55
|
117.85
|
ITC
|
159.42
|
202.70
|
202.04
|
203.89
|
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HDFC Life Insurance Company's promoter Standard Life (Mauritius Holdings) has offloaded shares worth over Rs 6,783 crore in the company.
Tata Motors has bagged an order for 15 hydrogen-based fuel cell buses from the Indian Oil Corporation.