Indian equity benchmarks managed
to eke out modest gains, ending higher for the fifth straight session. Markets
made an optimistic start, as traders took some support with Finance Minister
Nirmala Sitharaman exuding 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. Sentiments remained positive with Economic
Affairs Secretary Tarun Bajaj's statement that the government is sticking to
the target of becoming a $5 trillion economy by 2024-25 and emphasis on
infrastructure sector and other initiatives taken in Budget 2021-22 are aimed
at achieving the goal. The spending on infrastructure has gone up from Rs 4.12
lakh crore to Rs 5.54 lakh crore while on the health sector it has risen to Rs 2.23
lakh crore from Rs 94,000 crore in the Budget Estimate for 2020-21. However,
indices erased most of their initial gains and traded with volatility, after
Reserve Bank of India (RBI) decided to leave benchmark interest rate unchanged
at 4 per cent but maintained an accommodative stance, implying rate cuts in the
future if need arises to support the economy hit by the COVID-19 pandemic. The
benchmark repurchase (repo) rate has been left unchanged at 4 per cent,
Governor Shaktikanta Das said while announcing the decisions taken by the
central bank's Monetary Policy Committee (MPC). But, key gauges managed to end
the session in green, as International Monetary Fund (IMF) welcomed India's
Union Budget for focussing on growth and said fiscal policy can and should play
an important role in facilitating a strong and inclusive economic recovery.
IMF's Director of Communications, Gerry Rice has said that the Union Budget
rightly focuses on health, education, public infrastructure and, if fully
implemented, can help increase India's growth potential. Finally, the BSE
Sensex rose 117.34 points or 0.23% to 50,731.63, while the CNX Nifty was up by
28.60 points or 0.19% to 14,924.25.
The US markets ended higher on
Friday, extending the upward trend seen over the past several sessions, after
the Labor Department report released a closely watched report showing a modest
rebound in employment in the month of January. The report said non-farm payroll
employment edged up by 49,000 jobs in January after plunging by a revised 227,000
jobs in December. Street had expected employment to rise by about 50,000 jobs
following the loss of 140,000 jobs originally reported for the previous month.
A report released by the Commerce Department showed the US trade deficit
narrowed in the month of December, as the value of exports jumped by more than
the value of imports. The Commerce Department said the trade deficit narrowed
to $66.6 billion in December from a revised $69.0 billion in November. Street
had expected the trade deficit to shrink to $65.7 billion from the $68.1
billion originally reported for the previous month. The narrower deficit came
as the value of exports surged up by 3.4 percent to $190.0 billion, while the
value of imports increased by 1.5 percent to $256.6 billion. The spike in the
value of exports reflected significant increases in exports of crude oil,
soybeans, capital goods and automotive vehicles and parts.
Crude oil futures ended higher on
Friday on hopes energy demand will increase thanks the vaccination drive picking
up momentum, and on output cuts by the oil cartel. With the Organization of the
Petroleum Exporting Countries and allies agreeing to cut crude output this
month and the next, and Saudi Arabia deciding to unilaterally cut production by
1 million barrels per day, oversupply concerns have faded a bit. Oil prices
continued to be supported by recent data from the Energy Information
Administration (EIA) that showed US crude inventories dropped by 994,000
barrels last week to 475.7 million barrels, their lowest since March. Crude oil
futures for March rose $0.62 or 1.1 percent to settle at $56.85 barrel on the
New York Mercantile Exchange. April Brent crude gained 0.85 to settle at $59.34
a barrel on London's Intercontinental Exchange.
Indian rupee ended higher against
dollar on Friday, on selling of the American currency by exporters. Local
currency took support as Reserve Bank of India (RBI) has kept the policy repo
rate under the liquidity adjustment facility (LAF) unchanged at 4.0 per cent.
Consequently, the reverse repo rate under the LAF remains unchanged at 3.35 per
cent and the marginal standing facility (MSF) rate and the Bank Rate at 4.25
per cent. Also, RBI's projection of a GDP growth rate of 10.5 per cent for the
financial year beginning April 1, on the back of recovery in economic
activities. On the global front, pound edged higher against the dollar and the
euro on Friday after the Bank of England avoided sub-zero rates for now,
putting the pound on track for its fourth week of gains versus the dollar.
Finally, the rupee ended at 72.93, 3 paise stronger from its previous close of
72.96 on Thursday.
The FIIs as per Friday's data
were net buyer in both equity and debt segment. In equity segment, the gross
buying was of Rs 13634.23 crore against gross selling of Rs 9836.47 crore,
while in the debt segment, the gross purchase was of Rs 1174.71 crore with
gross sales of Rs 775.23 crore. Besides, in the hybrid segment, the gross
buying was of Rs 5.42 crore against gross selling of Rs 26.40 crore.
The US markets ended higher on
Friday, wrapping up a strong week on Wall Street as investors hoped a
disappointing January jobs report would increase the likelihood of further
stimulus. Asian markets are trading mostly in green on Monday on hopes a $1.9
trillion COVID-19 aid package will be passed by US lawmakers as soon as this
month just as coronavirus vaccines are being rolled out globally. Indian
markets extended their winning run to the fifth session and ended higher on
Friday after the Reserve Bank kept interest rates unchanged but continued its
accommodative stance to revive growth. Today, the start of new week is likely
to be optimistic tracking strong global cues. Traders will be taking
encouragement with Expenditure Secretary T V Somanathan's statement that the
government is confident of lowering the fiscal deficit to 4.5 per cent of GDP
by 2025-26 fiscal, considering a nominal GDP growth of 10 per cent every year.
Some support will come as principal economic advisor Sanjeev Sanyal said to
boost the pandemic-hit economy, the government of India is committed to higher
capital expenditure not just in the coming fiscal year but over the next three
years. He added that a sharp hike in capex in the recently announced Union
Budget reflects the government's economic strategy of rebuilding battered
demand while ensuring that the supply side is expanded enough to move in
tandem. Traders may take note of report that foreign portfolio investors (FPIs)
remained net buyers to the tune of Rs 12,266 crore in the Indian market in the
first five trading sessions of February, as positive sentiment post-Union
Budget 2021 sparked a rally in investment. However, there may be some
cautiousness with report that India reported 11,673 fresh Covid-19 cases on
Friday pushing the overall tally to 10,838,843, according to Worldometer. The
death toll from the deadly infection jumped to 155,114. Meanwhile, Economic
Affairs Secretary Tarun Bajaj said the government will borrow about Rs 12 lakh
crore for the next fiscal year at a reasonable rate and expressed hope that the
yield would be around the current year's level. Market participants will be
eyeing the industrial production data for December and CPI inflation for
January that are slated to be out on Friday, February 12. There will be some
buzz in pharma stocks with report that India's exports of pharmaceutical products
during April-December 2020-21 grew by 12.43 per cent to $17.57 billion.
Minister of State for Commerce and Industry Hardeep Singh Puri said India's
exports of pharmaceutical products have not declined and they are growing
consistently. Banking stocks will be in focus with Moody's Investors Service's
report that the government's support measures for bank borrowers have softened
growth in non-performing loans, averting the risk of a sharp asset quality
deterioration. There will be some reaction in steel industry stocks with ICRA's
report that the reduction of duty on steel products, as proposed in the Budget
2021-22, may bring down prices of the metal by up to 10 per cent in the near
term.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
14,924.25
|
14,854.45
|
15,004.35
|
BSE
Sensex
|
50,731.63
|
50,506.85
|
51,014.83
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
State
Bank of India
|
2,149.55
|
395.00
|
383.99
|
407.19
|
ITC
|
1,254.90
|
233.75
|
227.71
|
239.31
|
Tata
Motors
|
1,035.12
|
318.45
|
310.70
|
328.10
|
NTPC
|
549.11
|
99.65
|
97.86
|
101.71
|
Bharti
Airtel
|
348.11
|
584.20
|
571.66
|
601.31
|
HCL Technologies is planning to add 1,000 employees in the next few months to work out of its campus near Nagpur.
Coal India has signed a MoU with EESL for reducing its carbon footprint and improving the overall operational efficiency and profitability.
Bharti Airtel is keen on a full footprint of sub-GHz radiowaves across the country to boost coverage indoors and in rural areas.
ICICI Bank has signed a MoU with MUFG Bank, Japan's premier bank, for collaboration towards catering to the banking requirements of Japanese corporates present in India.