Indian equity
benchmarks ended the Wednesday's trades in green terrain on Wednesday with
Sensex and Nifty ending above their crucial 48,600 and 14,600 levels,
respectively. Markets started the day on optimistic note as upbeat earning from
several companies aided sentiments. Some support came in with report that
Brihanmumbai Municipal Corporation (BMC) received a fresh stock of one lakh
COVID vaccine doses and it will resume vaccination of people above 45 years at
government vaccination centres. Market participants largely overlooked S&P
Global Ratings' statement that an ongoing second wave of COVID-19 infections in
India could hurt its near-term economic recovery and possibly diminish growth for
the full year. It added that India's COVID wave will inevitably hit the
recovery and could push growth below 10%. Markets extended gains in late trade
to end near intraday highs as traders got support after Reserve Bank of India
(RBI) Governor Shaktikanta Das unveiled liquidity support measures amid rising
Covid-19 cases in India. Shaktikanta Das said that the 2nd wave of COVID-19 in
India has drastically altered the economic situation. He added that RBI will
continue to monitor emerging situation, using all resources. Further, RBI
announced fresh restructuring resolutions for individuals, small businesses and
Micro, Small and Medium Enterprises (MSME) borrowers who have an aggregate
exposure of upto Rs 25 crore. Traders
shrugged off reports that India's services sector activities eased to a
three-month low in April, as the rise in business activity was constrained by
the pandemic and sentiment towards growth prospects faded. The seasonally
adjusted India Services Business Activity Index fell to 54 in April from 54.6
in March, the slowest increase in output in three months. Finally, the BSE
Sensex rose 424.04 points or 0.88% to 48,677.55, while the CNX Nifty was up by
121.35 points or 0.84% to 14,617.85.
The US markets
ended mostly higher on Wednesday amid the Biden administration announced that
it supports waiving intellectual patent protections for Covid-19 vaccines, as
countries struggle to manufacture the life-saving doses. The continued upward
move by the Dow came after the blue chip index bucked the downtrend seen during
trading on Tuesday to close modestly higher. Strong gains by Dow Inc., Chevron
and Merck helped lift the Dow to a new record closing high. On the economic
data front, after reporting an unexpected slowdown in US manufacturing growth
earlier this week, the Institute for Supply Management (ISM) released a report
showing the pace of US service sector growth also unexpectedly slowed in the
month of April. The ISM said its services PMI edged down to 62.7 in April after
jumping to an all-time high of 63.7 in March. A reading above 50 still
indicates growth in the service sector, but street had expected the index to
inch up to 64.3. Private sector job growth in the US accelerated in the month
of April but still came in below street estimate, according to a report
released by payroll processor ADP. ADP said private sector employment spiked by
742,000 jobs in April after surging by an upwardly revised 565,000 jobs in
March. However, Street had expected private sector employment to soar by
800,000 jobs compared to the jump of 517,000 jobs originally reported for the
previous month. Chief economist at ADP, Nela Richardson said the labor market
continues an upward trend of acceleration and growth, posting the strongest
reading since September 2020. The report showed notable job growth in the
goods-producing sector, which added 106,000 jobs amid increases in both
manufacturing and construction jobs.
Crude oil futures ended
marginally lower on Wednesday despite US crude stocks falling more sharply than
expected. Data released by Energy Information Administration (EIA) showed crude
oil inventories dropped by 7.99 million barrels last week (April 30), more than
three times the expected decline. The EIA data also said US crude exports hit a
record high of 4.1 million barrels per day last week.The American Petroleum
Institute (API) reported on Tuesday that US crude stockpiles fell by 7.7
million barrels in the week ended April 30. Crude oil futures for June lost 6
cents or 0.09 percent to settle at $65.63 barrel on the New York Mercantile
Exchange. However, July Brent crude added 8 cents or 0.1 percent to settle at
$68.96 a barrel on London's Intercontinental Exchange.
Indian rupee ended lower against
the US dollar on Wednesday, on increased demand for the greenback from
importers and banks. Traders were worried as India's services sector activities
eased to a three-month low in April, as the rise in business activity was
constrained by the pandemic and sentiment towards growth prospects faded. The
seasonally adjusted India Services Business Activity Index fell to 54 in April
from 54.6 in March, the slowest increase in output in three months. However,
downfall remained limited as Reserve Bank of India (RBI) Governor Shaktikanta
Das said that the central bank will continue to monitor the emerging COVID-19
situation and will deploy all resources and instruments at its command for
citizens, business entities, and institutions beleaguered by the second wave. On
the global front, dollar hit its highest in over two weeks on Wednesday,
extending a rally as chatter about the possibility of higher U.S. interest
rates and a sell-off in tech stocks soured risk sentiment to the benefit of the
safe-haven currency. Finally, the rupee ended 73.91, weaker by 6 paise from its
previous close of 73.85 on Tuesday.
The FIIs as per Wednesday's data
were net seller in equity segment, while net buyer in debt segment. In equity
segment, the gross buying was of Rs 5884.79 crore against gross selling of Rs
7629.16 crore, while in the debt segment, the gross purchase was of Rs 913.25
crore with gross sales of Rs 283.83 crore. Besides, in the hybrid segment, the
gross buying was of Rs 0.56 crore against gross selling of Rs 13.69 crore.
The US markets ended mostly in
green on Wednesday driven higher by energy and other economically sensitive
sectors. Asian markets are trading higher on Thursday as investors look ahead
to the US jobs report due later this week for clues about how long the Fed will
stay on hold. Indian markets rallied about 1 percent on Wednesday after the
Reserve Bank of India (RBI) announced a raft of measures to help the financial
services industry tide over the second coronavirus wave that threatens economic
recovery. Today, the markets are likely to extend previous session's gains with
optimistic start following firm trade in Asian peers coupled with a strong set
of corporate numbers. Sentiments will be getting boost with a report that Roche
India announced that the Central Drugs Standards Control Organisation (CDSCO)
has provided an Emergency Use Authorisation (EUA) for its antibody cocktail
Casirivimab and Imdevimab in India to treat COVID-19 patients. Some support
will come as RBI Governor Shaktikanta Das on Wednesday hoped that a normal
Southwest monsoon will have a soothing impact on inflation pressures and ruled
out any wide variations in medium-term inflation forecast from what was given
in April, despite admitting to price pressures both from food items and input
prices. Traders may take note of Asian Development Bank's (ADB) statement that
investment in health, education and social protection alongside deeper regional
cooperation can help countries in Asia Pacific region in achieving equitable
recovery from the pandemic. However, the addition of another 412,618 fresh
Covid cases in the last 24 hours may cap the upside. With this, the cumulative
caseload has surged past 21 million, Worldometer showed. Traders may be
concerned as principal scientific advisor K Vijayaraghavan said the third phase
of the pandemic is inevitable given the high level of circulating virus,
without giving a timeframe. There may be some cautiousness as industry chamber
PHDCCI said imposition of partial lockdowns and curfews in many parts of the
country, due to re-emergence of COVID-19 pandemic, has created incipient signs
of economic slowdown in the coming months. Also, S&P Global Ratings has
slashed India's GDP growth forecast for the current financial year to 9.8 per
cent saying the second COVID wave may derail the budding recovery in the
economy and credit conditions. The US-based rating agency in March had a 11 per
cent GDP growth forecast for India for the April 2021-March 2022 fiscal on
account of a fast economic reopening and fiscal stimulus. Aviation stocks will
be in focus as rating agency Icra estimates 29 per cent sequential decline in
domestic air traffic in April as the second wave of Covid-19 disrupted air
travel. It said in April domestic airlines flew 5.5-5.6 million passengers
compared to 7.8 million passengers in March. There will be some important
earnings announcements too to keep the markets buzzing.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
14,617.85
|
14,537.00
|
14,668.30
|
BSE
Sensex
|
48,677.55
|
48,373.68
|
48,862.08
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Oil & Natural Gas Corporation
|
475.88
|
111.10
|
109.74
|
113.24
|
State Bank of India
|
408.72
|
355.40
|
349.79
|
359.24
|
Adani Ports and SEZ
|
294.26
|
738.10
|
722.26
|
764.36
|
Tata Motors
|
293.50
|
291.50
|
288.70
|
294.10
|
Sun Pharmaceutical Industries
|
252.96
|
683.40
|
654.46
|
700.11
|
L&T has immediately started working towards a long-term solution to meet the medical-grade oxygen demand in the country.
Maruti Suzuki India is expecting some impact on its production if lockdowns and curfews imposed across various states continue amid the second wave of COVID-19 sweeping across the country.
Coal India's operations slowed down on account of more than 5,400 of the company's employees and their wards across subsidiaries testing positive for coronavirus.
Infosys has joined forces with Deakin to develop a strategic action plan for research, innovation and skill development.