Indian equity
benchmarks witnessed volatile trading activity throughout the day and ended in
green on Wednesday, bucking the weak trend in global markets, helped by gains
in metal and realty stocks. Benchmarks made a cautious start and traded in a
narrow range for most part of the day, as traders remained cautious on report
that India recorded a spike of 43,957 new infections, taking the total caseload
to 30,662,896. Some concern also came as the Goods and Services Tax (GST)
collection slipped below Rs 1 lakh crore in June for the first time in eight
months as the second wave of the Covid pandemic and the resultant lockdowns hit
businesses and the economy. At Rs 92,849 crore, GST collection is the lowest in
10 months since August 2020, when it was Rs 86,449 crore. Traders also remained
worried with private report stated that monsoon rainfall across India has
turned a deficit for the first time this year, ending a strong start to the
season in June, with 30% of the country seeing deficient rainfall since the
start of the season. However, markets closed the session in green, as traders
found some solace with External Affairs Minister S Jaishankar's statement that
India is coming out of the second wave of the coronavirus pandemic and it will
witness a strong economic recovery and contribute to being an engine of growth
for the global economy. He said India will be a more dynamic and friendlier
business destination and it will be part of more reliable and resilient supply
chains that the post-Covid world requires. Some support also came as government
brought Department of Public Enterprises (DPE) under the Finance Ministry in
order to better control public sector enterprises as it looks to privatize them.
Earlier, the DPE came under the Ministry of Heavy Industries and Public
Enterprises. It monitors the performance of PSUs, dividend, capex performance,
possibility of buyback of shares, and pay packages of the staff, among others.
Traders also took a note of another private report stated that India's hiring
rate has recovered moderately from 10 per cent in April to 35 per cent in May
2021, but the aftermath of the second COVID-19 wave has left professionals in
India increasingly vulnerable to the economic uncertainty. Finally, the BSE
Sensex rose 193.58 points or 0.37% to 53,054.76, while the CNX Nifty was up by
61.40 points or 0.39% to 15,879.65.
The US markets ended higher on
Wednesday as the minutes of the Federal Reserve's latest monetary policy
meeting signaled the central bank will not be in a hurry to begin scaling back
its asset purchase program. The minutes of the June meeting reiterated Fed
Chair Jerome Powell's view that substantial further progress towards the goals
of maximum employment and price stability has not yet been met. The Fed has
repeatedly said it plans to continue to its asset purchases at a rate of at
least $120 billion per month until substantial further progress has been made
toward its goals. While various participants expect conditions for beginning to
reduce the pace of asset purchases to be met somewhat earlier than they had
previously anticipated, others saw incoming data as providing a less clear
signal about the underlying economic momentum. The minutes said some
participants determined the Fed would be able to make a better assessment in
the coming months and emphasized the central bank should be patient in
assessing progress toward its goals and in announcing changes to its plans for
asset purchases. The Fed said participants agreed to continue assessing the
economy's progress toward the central banks goals at coming meetings and to
begin to discuss their plans for adjusting the path and composition of asset
purchases. In addition, the Fed said participants reiterated their intention to
provide notice well in advance of an announcement to reduce the pace of
purchases.
Crude oil futures ended lower for
second straight day on Wednesday amid concerns that several leading oil
producers will likely increase output following a disagreement over output
policy. The Organization of the Petroleum Exporting Countries and their major
allies failed to reach an agreement on output levels. The meeting, which was
originally scheduled to happen last Thursday, first got postponed and then was
abandoned altogether this Monday with no decision on production levels, after
the United Arab Emirates and Saudi Arabia fell out, with the former refusing to
agree to a proposal backed by the latter. Crude oil futures for August fell
$1.17 or about 1.6 percent to settle at $72.20 barrel on the New York
Mercantile Exchange. September Brent crude dropped $1.25 or 1.7 percent to
settle at $73.28 a barrel on London's Intercontinental Exchange.
Continuing prevision session
thrashing, Indian rupee ended weaker against dollar on Wednesday, on emergence
of demand for the greenback from importers. Traders were worried on report that
Goods and Services Tax (GST) collection slipped below Rs 1 lakh crore in June
for the first time in eight months as the second wave of the Covid pandemic and
the resultant lockdowns hit businesses and the economy. However, downfall
remained capped as government brought Department of Public Enterprises (DPE)
under the Finance Ministry in order to better control public sector enterprises
as it looks to privatize them. On the global front, sterling steadied versus
the dollar and the euro on Wednesday after hitting a week's high against the
dollar and a 12-day high against the euro this week as Britain set out
reopening plans following the COVID-19 pandemic. Finally, the rupee ended
74.62, weaker by 7 paise from its previous close of 74.55 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 5786.31 crore against gross selling of Rs
4750.50 crore, while in the debt segment, the gross purchase was of Rs 129.06 crore
with gross sales of Rs 1016.94 crore. Besides, in the hybrid segment, the gross
buying was of Rs 6.91 crore against gross selling of Rs 7.87 crore.
The US markets ended higher on
Wednesday after minutes from the Federal Reserve's latest meeting largely
confirmed market expectations. Asian markets are trading mostly in red on
Thursday as the coronavirus situation in parts of the region weighed on
investors' sentiment. Indian markets ended at record closing highs Wednesday
led by gains in metals and realty stocks. Today, the start of session is likely
to be pessimistic amid weakness in Asian peers. Investors are eyeing the Q1FY22
earnings season which will kick start from today with TCS results, likely to
guide the market trajectory. Rising coronavirus cases likely to weight on
market sentiments. India recorded a spike of 45,196 new infections, taking the
total caseload to 30,708,092, according to Worldometer. The death count increased
to 405,054 with 814 new fatalities. Traders will be concerned with ICRA's
report that the high level of overdues in loan books could spike fresh
non-performing assets (NPAs) in the first half of the current fiscal ending
September 2021 (H1FY22) amid the surge in Covid cases and its economic impact.
There will be some cautiousness as Fitch Ratings cut India's growth forecast to
10 per cent for the current fiscal, from 12.8 per cent estimated earlier, due
to slowing recovery post second wave of COVID-19, and said rapid vaccination
could support a sustainable revival in business and consumer confidence.
However, some support may come later in the day as Commerce and Industry
Minister Piyush Goyal called for a services trade agreement among friendly nations
of the Indo-Pacific region as it can help liberalise domestic regulations and
build capacity in sectors like e-commerce and IT. Select banking stocks will be
in limelight as the Reserve Bank of India (RBI) imposed a monetary penalty on
14 banks, including State Bank of India (SBI), Bandhan Bank, IndusInd Bank,
Bank of Baroda (BoB), Central Bank for non-compliance with certain provisions
of directions issued by them. The penalty ranges from Rs 50 lakh to Rs 2 crore,
with SBI being charged Rs 50 lakh and BoB Rs 2 crore. IT industry stocks will
be in focus as ratings agency Crisil said the Indian IT industry will stage a
strong recovery in 2021-22 with a revenue growth of up to 11 per cent. It said
the recovery will be led by increasing outsourcing and accelerating digital
transformation services mainly in sectors such as banking, financial services
and insurance (BFSI), healthcare, retail and manufacturing. There will be some
reaction in aviation industry stocks as global airlines body IATA said India's domestic
traffic was 71 percent lower in May this year compared to the corresponding
period in 2019 amid the emergence of more contagious Delta variant of
coronavirus.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
15,879.65
|
15,808.39
|
15,922.24
|
BSE
Sensex
|
53,054.76
|
52,835.87
|
53,189.52
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Motors
|
1,121.83
|
317.10
|
309.20
|
322.05
|
Oil & Natural Gas Corporation
|
184.79
|
119.90
|
118.34
|
120.94
|
ITC
|
178.79
|
203.75
|
202.30
|
205.20
|
Tata Steel
|
167.45
|
1218.65
|
1,176.44
|
1,242.94
|
NTPC
|
145.45
|
117.45
|
116.80
|
118.15
|
Kotak Mahindra Bank's subsidiary -- Kotak Securities has entered into an agreement with Kredent InfoEdge for investment of Rs 10 crore for a 9.96%.
M&M has signed a Power Delivery Agreement with ReNew Sunlight Energy.
SBI is planning to auction two NPA accounts next month to recover dues of over Rs 313 crore.
HDFC Bank has entered into partnership with fintech company Creditas Solutions to offer a guided and customized debt management solution for its loan and credit card customers.