Indian equity benchmarks staged a
sharp recovery from the day's low to end near the highest point of the day, and
registered yet another record closing high level on Monday, tracking gains in
index majors ONGC, TCS, HCL Technologies and Tech Mahindra. Sentiments got a
boost after the Drugs Controller General of India (DCGI) granted restricted
emergency use authorization for the Serum Institute of India (SII)'s Covishield
and Bharat Biotech's Covaxin vaccines against COVID-19. Also, Union Minister of
State for Health and Family Welfare Ashwini Kumar Choubey stated that India
will become corona-free. Some support also came in with government data showing
that signalling an economic revival, goods and services tax (GST) collection
touched a record high in December, posting growth of 11.6 per cent year-on-year
(Y-o-Y) and surpassing the Rs 1-trillion mark for the third straight month.
However, during the late morning session markets slipped as there was some
cautiousness with the commerce ministry's data showing that the country's
exports declined marginally by 0.8 percent to $26.89 billion in December 2020,
compeered to $27.11 billion December
2019 due to contraction in sectors like petroleum, leather and marine products.
The trade deficit in December widened to $15.71 billion, as imports grew by 7.6
percent to $42.6 billion. However, markets soon regained and further
strengthened, after India's manufacturing sector continued to strengthen in
December with companies stepping up production and input buying amid efforts to
rebuild their inventories following pandemic-driven business closures earlier
in 2020. Data released by analytics firm IHS Markit showed Purchasing Managers'
Index (PMI) for manufacturing sector picked up marginally in December to 56.4
from 56.3 a month ago. A figure above 50 indicates expansion, while sub-50
signals contraction. Finally, the BSE Sensex rose 307.82 points or 0.64% to
48,176.80, while the CNX Nifty was up by 114.40 points or 0.82% to 14,132.90.
The US markets ended lower on
Monday on profit taking after the Dow and the S&P 500 reached new record
intraday highs. The sharp pullback on the markets reflected concerns about the
recent spike in coronavirus cases in several parts of the world, with a new
strain of the virus being detected in the US for the first time. U.K. Prime
Minister Boris Johnson has announced the country will go back into full
lockdown until at least mid-February as a result of the new, more contagious variant
of Covid-19. Meanwhile, Japanese Prime Minister Yoshihide Suga is considering
declaring a state of emergency in the greater Tokyo area to curb the spread of
the coronavirus. Meanwhile, Airline stocks moved sharply lower amid concerns
about new coronavirus restrictions, resulting in a 5.2 percent nosedive by the
NYSE Arca Airline Index. On the economic data front, the Commerce Department
released a report showing a continued increase in construction spending in the
month of November. The report said construction spending climbed by 0.9 percent
to an annual rate of $1.459 trillion in November after surging up by 1.6
percent to a revised rate of $1.447 trillion in October. Street had expected
construction spending to increase by 1.0 percent compared to the 1.3 percent
jump originally reported for the previous month.
Crude oil futures ended lower on
Monday on concerns over outlook for energy demand and on reports about the
Oragnization of the Petroleum Exporting Countries (OPEC) and allies' failure to
reach an agreement on crude output. The OPEC and allies, including Russia, will
now meet again on Tuesday to decide whether they can continue to restore crude
supplies without capsizing the price recovery. OPEC+ raised output by 500,000
barrels per day this month. However, some members are against further
increasing output from next month due to the surge in coronavirus cases. Crude
oil futures for February fell $0.90 or 1.9 percent to settle at $47.62 a barrel
on the New York Mercantile Exchange. March Brent crude dropped $0.71 or 1.4
percent to settle at $51.09 a barrel on London's Intercontinental Exchange.
Erasing prevision session losses,
Indian Rupee ended fairly higher against US dollar on Monday, on the back of
selling of the American currency by exporters. Sentiments were upbeat as
foreign portfolio investors (FPIs) remained net buyers for the third month in a
row by investing Rs 68,558 crore in December in Indian markets as global
investors continued betting on emerging markets. For the equity segment, this
is the highest quantum of money invested ever since the FPI data has been made
available by the National Securities Depository. Some respite also came as
Indian manufacturing sector strengthened in the month of December, with
manufacturers stepping up production and input buying amid efforts to rebuild
their inventories following business closures earlier in the year. Besides,
healthy gains in Indian equity markets also supported the rupee. On the global
front; pound weakened versus the euro on Britain's first day of trading outside
the European Union, but strengthened against a softer dollar, climbing above
$1.37 for the first time since May 2018, as traders weighed up Brexit relief
with COVID-19 risks. Finally, the rupee ended at 73.02, 9 paise stronger from
its previous close of 73.11 on Friday.
The FIIs as per Monday's data
were net buyer in equity segment and net seller in debt segment. In equity
segment, the gross buying was of Rs 1954.18 crore against gross selling of Rs
773.94 crore, while in the debt segment, the gross purchase was of Rs 132.98
crore with gross sales of Rs 183.97 crore. Besides, in the hybrid segment, the
gross buying was of Rs 22.04 crore against gross selling of Rs 0.85 crore.
The US markets ended lower on
Monday as risk appetite ebbed amid upcoming runoff elections in Georgia and the
persistent surge in coronavirus cases.
Asian markets are trading mixed on Tuesday amid uncertainty about Senate
runoffs in Georgia, which could have a big impact on incoming US President Joe
Biden's economic policies. Indian markets ended at record levels on Monday led
by robust buying in metal and IT stocks. Today, the start of session is likely
to be negative tracking weakness in global peers coupled with concerns over
rising coronavirus cases in the country. With 16,278 fresh Covid-19 cases,
India's caseload now stands at 10,357,569. The country's death toll is nearing
150,000. With 1,947,011 cases, Maharashtra has the highest number of coronavirus
cases, followed by Karnataka 921,938, Andhra Pradesh 883,210, Tamil Nadu
820,712, and Kerala 778,873. Also, trader will be cautious as Fitch Solutions
expect the rupee to trade only slightly weaker over the near term from current
levels. However, some support may come later in the day with Minister of State
for Finance Anurag Thakur's statement that the central government is making
efforts to turn India into a manufacturing and export powerhouse. Thakur said
manufacturing will now be broad-based in the country. Meanwhile, the Finance
Ministry on Monday released the tenth instalment of Rs 6,000 crore to the
states to meet the GST compensation shortfall, taking the total amount provided
so far under this window to Rs 60,000 crore. The Centre had set up a special
borrowing window in October 2020 to meet the estimated shortfall of Rs 1.10
lakh crore in revenue arising on account of implementation of GST. Aviation
stocks will be in focus with ICRA's
report that the domestic aviation industry's net losses may reduce to Rs 14,600
crore from an estimated a net loss of Rs 21,000 crore this fiscal, With around
57 percent growth expected in revenue in FY22 on the back of a likely higher
passenger traffic.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
14,132.90
|
14,008.45
|
14,202.65
|
BSE
Sensex
|
48,176.80
|
47,774.03
|
48,400.03
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata
Motors
|
639.81
|
191.30
|
189.04
|
193.29
|
Oil
& Natural Gas Corporation
|
395.45
|
96.95
|
94.66
|
98.26
|
Tata
Steel
|
381.85
|
693.00
|
659.66
|
713.11
|
State
Bank of India
|
314.51
|
281.05
|
277.90
|
284.05
|
ITC
|
268.92
|
213.40
|
211.66
|
215.56
|
L&T's wholly owned subsidiary -- L&T Hydrocarbon Engineering has won an order from HPCL Rajasthan Refinery.
Bajaj Auto has reported 11 per cent rise in total sales to 372,532 units in December as against 336,055 in the same month last year.
Coal India's supply of coal to the consuming sectors rose 9.2 per cent to 154.6 million tonnes in the Q3 of the current financial year.
Tata Motors has signed a memorandum of understanding with Karnataka Bank to introduce financing offers for customers.