Indian equity benchmarks
continued the winning streak on the fourth straight session and settled at
record closing high on Thursday, led by advances in Power, FMCG, Metal and
Banking stocks. Initially, weak global cues led to a muted start in the
benchmarks. Some concern also came with rating agency Moody's statement that
India's fiscal deficit projections are higher than expected and slower
consolidation will constrain its fiscal strength over the medium term. It also
expects India's nominal GDP growth to rise to closer to 17 percent in fiscal
2021, higher than 14.4 percent projected in the Budget. However, the markets
turned positive from weak start and traded near lifetime highs following a recovery
in banking stocks. Sentiments remained up-beat as the Corporate Affairs
Ministry has revised the definition of small companies under the Companies Act
by increasing their thresholds for paid-up capital from 'not exceeding Rs 50
lakh' to 'not exceeding Rs two crore' and turnover from 'not exceeding Rs two
crore' to 'not exceeding Rs 20 crore'. A Ministry release said the step, in
line with the government's vision, is expected to benefit more than two lakh
companies in terms of lesser compliances, lesser filing fees and lesser
penalties in the event of any defaults. Additional support also came as the
Finance Ministry has released the 14th installment of Rs 6,000 crore to states
to meet the GST compensation shortfall, taking the total amount of fund released
so far to Rs 84,000 crore. Till now, 76 per cent of the total estimated GST
compensation shortfall has been released to states and 3 UTs. Out of this, an
amount of Rs 76,616.16 crore has been released to 23 states and Rs 7,383.84
crore to the 3 UTs with Legislative Assembly (Delhi, J&K, Puducherry).
Finally, the BSE Sensex rose 358.54 points or 0.71% to 50,614.29, while the CNX
Nifty was up by 105.70 points or 0.71% to 14,895.65.
The US markets settled higher
with gains of over one percent on Thursday. The Nasdaq and the S&P 500
ended the session at new record closing highs. The markets continued to benefit
from the upward momentum seen on Monday and Tuesday, which helped stocks
largely offset the steep losses posted last week. Easing concerns about
speculative trading have helped drive the markets higher along with mostly
upbeat earnings news from big-name companies. Positive sentiment was also
generated in reaction to a report from the Labor Department showing a continued
decline in first-time claims for US unemployment benefits in the week ended
January 30th. The report said initial jobless claims fell to 779,000, a
decrease of 33,000 from the previous week's revised level of 812,000. Street
had expected jobless claims to edge down to 830,000 from the 847,000 originally
reported for the previous week. Jobless claims dropped for the third straight
week, falling to their lowest level since hitting 716,000 in the week ended
November 28th. Meanwhile, new orders for US manufactured goods showed another
significant increase in the month of December, according to a report released
by the Commerce Department. The report said factory orders jumped by 1.1
percent in December after surging up by 1.3 percent for three consecutive
months. Street had expected factory orders to climb by 0.7 percent. The bigger
than expected increase in factory orders came as orders for non-durable goods
spiked by 1.7 percent, while orders for durable goods rose by an upwardly
revised 0.5 percent.
Crude oil futures settled higher
for fourth straight session on Thursday, on continued optimism that crude oil
supplies will drop thanks to OPEC and its allies' commitment to reduce output
to stabilize the oil market. OPEC and its allies, known as OPEC+, extended
their current oil output policy at a meeting on Wednesday. Amid uncertain
prospects for the global economy, there wasn't any recommendation about
changing the production levels of the alliance. Ministers led by Saudi Arabia
and Russia struck a note of cautious optimism about global oil markets and
stressed the importance of accelerating market re-balancing without delay. Crude
oil futures for March rose $0.54 or 1 percent to settle at $ 56.23 barrel on
the New York Mercantile Exchange. April Brent crude gained $ 0.12 or 0.2
percent to settle at $ 58.81 a barrel on London's Intercontinental Exchange.
Indian rupee ended flat on
Thursday due to mild dollar demand from banks and importers. Traders took note
of report that Minister of State for Commerce and Industry Som Parkash informed
the Lok Sabha that in the last six financial years (2014-20), India has
received FDI inflow worth $358.30 billion which is 53 per cent of the FDI
reported in the last 20 years ($681.87 billion). Meanwhile, rating agency
Moody's stated that India's fiscal deficit projections are higher than expected
and slower consolidation will constrain its fiscal strength over the medium
term. It also expects India's nominal GDP growth to rise to closer to 17
percent in fiscal 2021, higher than 14.4 percent projected in the Budget. On
the global front, pound fell to its weakest in two and a half weeks against the
dollar on Thursday before a Bank of England meeting on caution about the
possibility of negative rates. Finally, the rupee ended unchanged from its
previous close of 72.96 on Wednesday.
The FIIs as per Thursday's data
were net buyer in both equity and debt segment. In equity segment, the gross
buying was of Rs 11553.18 crore against gross selling of Rs 8871.89 crore,
while in the debt segment, the gross purchase was of Rs 1141.83 crore with
gross sales of Rs 1077.32 crore. Besides, in the hybrid segment, the gross
buying was of Rs 17.61 crore against gross selling of Rs 33.54 crore.
The US markets ended
significantly higher on Thursday as investors looked to corporate earnings and
signs of progress on a pandemic-relief package after data suggested the labor
market was stabilizing. Asian markets are trading in green on Friday after
overnight gains stateside that saw the S&P 500 hitting a record closing
high. Indian markets ended at record high levels on Thursday, extending their
gaining streak for the fourth consecutive session, led by a surge banking,
metals, and FMCG stocks. Today, the markets are likely to open higher ahead of
the Reserve Bank of India's (RBI) monetary policy outcome amid positive global
cues. There are expectations that the RBI's rate-setting Monetary Policy
Committee (MPC) is likely to hold interest rates and continue with
accommodative policy stance so that necessary monetary action could be taken to
push growth. This is the first MPC meeting after the presentation of the Union
Budget 2021-22. The MPC kept the key benchmark rate unchanged in its last three
reviews. Some support will come as Finance Minister Nirmala Sitharaman exuded
confidence that the disinvestment calendar announced in the Union Budget will
work well. She added the government is confident that revenue generation will
improve through this year and it will be bringing in non-tax revenue other than
just disinvestments through various routes, including monetisation of assets.
Traders may take note of report that the IMF has welcomed India's Union Budget
for focusing on growth and said fiscal policy can and should play an important
role in facilitating a strong and inclusive economic recovery. However,
investors may be concerned with report that India recorded 12,410 fresh
Covid-19 cases of the coronavirus disease (Covid-19). There may be some cautiousness
with a private report that exporters are concerned about the proposed
amendments in the integrated goods and services tax (IGST) in the Finance Bill
that have taken away the flexibility of exporting on the payment of the
integrated tax. Oil & gas and oil marketing companies stocks will be in
limelight as petrol and diesel prices climbed to fresh highs in the country as
rates were hiked by the most in recent times, even as fuel retailers said the
government can cut taxes to ease consumer burden. Broadcasting & Cable TV
industry stocks will be in focus after Telecom regulator TRAI issued its
recommendations on the back reference from the Ministry of Information and
Broadcasting on the authority's earlier guidelines on the regulatory framework for
platform services offered by DTH. TRAI recommended that programmes transmitted
by the DTH operators or MSOs or IPTV operators as a platform service shall be
exclusive and the same shall not be permitted to be shared directly or
indirectly with any other DPO. Meanwhile, Stove Kraft shares will make their
share market debut on Friday.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
14,895.65
|
14,769.04
|
14,967.99
|
BSE
Sensex
|
50,614.29
|
49,926.45
|
50,687.51
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
State
Bank of India
|
1,452.03
|
355.10
|
338.14
|
365.04
|
Tata
Motors
|
1,210.33
|
326.15
|
320.90
|
332.95
|
ITC
|
1,058.19
|
229.95
|
220.16
|
235.56
|
Indian
Oil Corporation
|
511.71
|
103.60
|
102.61
|
104.46
|
Bharti
Airtel
|
510.19
|
600.60
|
589.84
|
617.19
|
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