Indian equity
benchmarks ended with marginal gains on Tuesday, on the back of buying in index
heavyweights such as Bharti Airtel, Tech Mahindra and HDFC amid a largely
positive trend in global markets. Markets made positive start and traded higher
for most part of the day, as sentiments got a boost with the Centre for
Monitoring Indian Economy (CMIE) data showing that India witnessed an addition
of 16 million jobs in July mainly in the agriculture and construction sectors.
Some optimism also came with the Finance Ministry's statement that a Bill to
end retrospective taxes imposed on indirect transfer of Indian assets will
encourage companies to invest in India and help the country become a $5-trillion
economy. Traders also remained positive with private report stating that
business resumption activity reached a record high since the start of the
pandemic over 15 months ago for the week ended August 8. The Nomura India
Business Resumption Index (NIBRI) rose to a record high of 99.4 for the week
ending 8 August, from 94.0 last week, near the pre-pandemic level of 100, and
surpassing the pre-second wave peak (of 99.3 in mid-February). However, markets
trimmed all the gains in late hour of trading session, as country's
unemployment rate rose to a six-week high of 8.1% in the week ended August 8,
2021. But, markets recovered from blip to end in the green, as country's
exports rose by 50.45 percent to $7.41 billion during August 1-7, on account of
healthy growth in the shipments of engineering goods, gems and jewellery as
well as petroleum products. Some support also came as the Reserve Bank issued
draft guidelines to further liberalise regulatory framework governing overseas
investments with a view to promote ease of doing business. The RBI has placed
on its website two documents -- draft Foreign Exchange Management (Non-debt
Instruments - Overseas Investment) Rules, 2021 and draft Foreign Exchange
Management (Overseas Investment) Regulations, 2021. Meanwhile, Minister of
State for Finance Pankaj Chaudhary's statement that net Goods and Services Tax
(GST) collection in the April-June quarter was over Rs 1.67 lakh crore, which
is 26.6 percent of the budget estimate of Rs 6.30 lakh crore for full 2021-22 fiscal.
Finally, the BSE Sensex rose 151.81 points or 0.28% to 54,554.66, while the CNX
Nifty was up by 21.85 points or 0.13% to 16,280.10.
The US markets ended mostly
higher on Tuesday with the Dow and S&P 500 closing at record highs
following the Senate passing the $1 trillion infrastructure bill. The Senate
passed the infrastructure bill, which earmarks $550 billion in new spending for
areas including transportation and the electric grid. The bill now heads to the
House, although Speaker Nancy Pelosi, D-Calif., has said she will not bring it
to the floor until the Senate also passes a budgetary proposal. On the sectoral
front, steel stocks moved sharply higher over the course of the session,
driving the NYSE Arca Steel Index up by 3.2 percent to its best closing level
in three months. Considerable strength was also visible among oil service
stocks, as reflected by the 2.5 percent jump by the Philadelphia Oil Service
Index. However, buying interest was somewhat subdued as traders looked ahead to
the release of a Labor Department report on consumer price inflation in the
month of July on Wednesday. Street currently expects consumer prices to climb
by 0.5 percent in July after advancing by 0.9 percent in June. The annual rate
of consumer price growth is expected to slow to 5.3 percent from 5.4 percent.
Core consumer prices, which exclude food and energy prices, are expected to
rise by 0.4 percent in July following a 0.9 percent increase in June.
Year-over-year core price growth is expected to drop to 4.3 percent from 4.5
percent.
Crude oil futures end higher on
Tuesday as data showing a surge in fuel demand in India in the month of July
pushed up prices. In India, fuel consumption, a proxy for oil demand, totaled
16.83 million tons in July, up 2.9% from June and 7.9% from the same period a
year ago as most restrictions were eased. Besides, traders were also hopeful
that energy demand in the US and Europe will rise significantly in the coming
weeks. The US Energy Information Administration (EIA) said in a monthly
forecast that gasoline consumption in the country is expected to average 8.8
million barrels per day (bpd) in 2021, up from 8 million bpd in 2020. The trend
of rising employment and mobility is expected to continue into next year,
leading to gasoline consumption averaging almost 9 million bpd in 2022. Crude
oil futures for September rose $1.81 or 2.7 percent to settle $68.29 barrel on
the New York Mercantile Exchange. October Brent crude surged $1.82 or 2.6
percent to settle at $70.86 a barrel on London's Intercontinental Exchange.
Continuing previous session
drubbing, Indian rupee concluded substantially weaker against dollar on Tuesday
on account of continued dollar demand from importers and banks. Traders were
worried despite private report stating that the India's retail inflation likely
slowed to three-month low in July, bringing it back within the central bank's
target range, on falling food prices and an easing of supply chain disruptions.
There's a material drop in edible oil and palm oil prices after tariff
reductions and global oil price volatility has eased as well. On the global
front, dollar hit a four-month high versus the euro on Tuesday after upbeat
U.S. jobs data bolstered expectations that the Federal Reserve could soon start
tapering its massive bond-buying program. Finally, the rupee ended 74.43,
weaker by 17 paise from its previous close of 74.26 on Monday.
The FIIs as per Tuesday's data
were net buyer in equity segment, while net seller in debt segment. In equity
segment, the gross buying was of Rs 6223.03 crore against gross selling of Rs
5778.10 crore, while in the debt segment, the gross purchase was of Rs 161.83
crore against gross selling of Rs 237.90 crore. Besides, in the hybrid segment,
the gross buying was of Rs 1.76 crore against gross selling of Rs 8.59 crore.
The US markets ended mostly
higher on Tuesday as market sentiment was boosted by the U.S. Senate passing a
$1 trillion bipartisan infrastructure bill. Asian markets are trading mixed on
Wednesday as investors awaited a key report on U.S. inflation. Indian markets
moved between gains and losses on Tuesday but managed to end the day with gains
amid mixed global cues. Today, markets are likely to open flat with a positive
bias tracking overnight gains on Wall Street. Some support will come as The
Reserve Bank issued draft guidelines to further liberalise the regulatory
framework governing overseas investments with a view to promote ease of doing
business. Traders likely to continue take support with provisional commerce
ministry data showing that the country's exports rose by 50.45 per cent to $7.41
billion during August 1-7, on account of healthy growth in the shipments of
engineering goods, gems and jewellery as well as petroleum products. Traders
may take note of the finance ministry's statement the economic impact of the
second wave of the COVID-19 pandemic is likely to be muted and there are
visible signs of economic rejuvenation. The latest Monthly Economic Review,
released by the finance ministry, said the robust recovery in tax collections
cushions the fisc towards meeting the budgeted support to the economy. It also
said the recent sero-prevalence results signify that India can reduce the
likelihood of severe illness due to COVID-19 if the country sustains the
momentum of the vaccination programme. Besides, India recorded 36,316 new
Covid-19 cases and 468 deaths in the past 24 hours, taking its tally to
32,033,333 and the death toll to 429,183. Meanwhile, Realtors' body Credai has
demanded that input tax credit (ITC) under the GST regime should be allowed to
developers, saying this could lead to a reduction in housing prices by 10 per
cent. Credai, which has over 13,000 member developers, has urged the central
government to facilitate the ITC for real estate developers under the composite
scheme of GST. Banking stocks will be in focus with Moody's report that the
asset quality risks for banks will rise in most parts of ASEAN and India, as
the region battles new waves of coronavirus infections amid low vaccination
rates. Also, a private report stated that Public sector banks have advanced
133,000 unsecured loans to individuals to meet Covid-19 treatment costs. There
will be lots of important earnings announcements too, to keep the markets in
action.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
16,280.10
|
16,201.81
|
16,358.81
|
BSE
Sensex
|
54,554.66
|
54,315.74
|
54,786.63
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Bharti Airtel
|
338.78
|
622.20
|
604.40
|
634.00
|
State Bank of India
|
277.94
|
426.45
|
419.96
|
434.66
|
ITC
|
181.55
|
209.85
|
207.45
|
213.35
|
Tata Motors
|
151.73
|
294.20
|
290.06
|
299.26
|
Oil & Natural Gas Corporation
|
143.00
|
114.85
|
113.94
|
115.74
|
JSW Steel has reported 13.82 lakh tonnes crude steel production in July 2021, registering a growth of 11% as compared to 12.46 lakh tonnes in July 2020.
ITC is rapidly scaling up its community development programs and has forged 83 PPP with several state governments and government bodies as part of the initiative.
Tech Mahindra has collaborated with actor, producer, entrepreneur Jackky Bhagnani's music label Jjust Music under the Vande Mataram song launch initiative.
Tata Motors has launched new variants of its flagship SUVs Harrier and Safari in the country.