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NSE Intra-day chart (18 January 2021)
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Market Commentary 19 January 2021
Markets likely to get positive start tracking gains in Asian peers


Indian equity benchmarks ended the Monday's trade in red terrain as traders remained worried on account of weak global cues. Markets made a cautious start as India registered 13,962 fresh Covid-19 cases in the last 24 hours, taking the tally to 10,572,672. Sentiments also remain dampened on report stating that the Indian economy is not recovering as fast as the government claims and the country's economy may contract 25 per cent in the current financial year. It further states that due to a big decline in the GDP during the current financial year, the budget estimates have gone completely out of gear and, therefore, there is a need to correct the Budget. Traders also took note of former chief economic adviser Arvind Virmani's statement that the Indian economy is likely to contract in the range of 5-7.5 per cent this fiscal (FY21) but will see a growth of 9 to 11 per cent in FY 2021-22. Further, Virmani said in the upcoming Budget, the government should come up with policies to accelerate India's economic growth. Markets trimmed most of their initial losses in second half of the trade as the Reserve Bank of India (RBI) has decided to conduct purchase of Government securities under Open Market Operations (OMO) for an aggregate amount of Rs 10,000 crore on January 21, 2021. Some support also came after the government data showing that India's exports rose marginally to $27.15 billion in December 2020, while imports surged 7.56 per cent to $42.59 billion. The merchandise exports were valued at $27.11 billion in December 2019, while imports had totalled $39.59 billion. Traders also took some solace with Reserve Bank of India (RBI) in its latest report has showed that bank credit grew 3.2 per cent to Rs 107.05 lakh crore in the first nine months (April-December) of the current financial year (FY21), against a growth of 2.7 per cent registered in the corresponding period of 2019-20. In the fortnight ended March 27, 2020, bank advances stood at Rs 103.72 lakh crore. However, intense selling in last of trade dragged markets below their psychological levels of 14,300 (Nifty) and 48,600 (Sensex). Finally, the BSE Sensex fell 470.40 points or 0.96% to 48,564.27, while the CNX Nifty was down by 152.40 points or 1.06% to 14,281.30.


The US markets were closed on Monday on account of Martin Luther King, Jr. Day.


Rupee ended substantially weaker against dollar on Monday on account of continued dollar demand from importers and banks. Besides, heavy selloff in domestic equity markets also weighed on the rupee sentiment. Investors' mood remained fragile with former chief economic adviser Arvind Virmani's statement that the Indian economy is likely to contract in the range of 5-7.5 per cent this fiscal (FY21) but will see a growth of 9 to 11 per cent in FY 2021-22. Further, Virmani said in the upcoming Budget, the government should come up with policies to accelerate India's economic growth. Meanwhile, foreign portfolio investors (FPI) put in Rs 14,866 crore in Indian markets in the first half of January with participants expecting strong third-quarter results by companies. On the global front, dollar held firm at a four-week high against its rivals on Monday as an undercurrent of risk aversion swept through currency markets in the backdrop of weak U.S. economic data, knocking the Australian dollar and the euro lower. Finally, the rupee ended at 73.28, 21 paise weaker from its previous close of 73.07 on Friday.


The FIIs as per Monday's data were net seller in both equity segment and debt segment. In equity segment, the gross buying was of Rs 5247.32 crore against gross selling of Rs 6300.18 crore, while in the debt segment, the gross purchase was of Rs 864.05 crore with gross sales of Rs 1265.77 crore. Besides, in the hybrid segment, the gross buying was of Rs 10.27 crore against gross selling of Rs 20.67 crore.


The US markets was shut on Monday on account of Martin Luther King Jr. Day. Asian markets are trading mostly higher on Tuesday as investors awaited comments from Joe Biden's Treasury Secretary nominee Janet Yellen on US stimulus and the dollar. India markets ended lower on Monday dragged by heavy selling across the board. Today, the markets are likely to make positive start tracking gains in Asian peers. Traders will be taking encouragement with Icra's report stating that economic activity recorded a broad-based improvement in December as against November, showing a return of demand. Icra said most of the indicators have displayed a year-on-year (y-o-y) expansion in December 2020, which signals a tentative return to pre-COVID normalcy. Some support will come as the Finance Ministry on Monday released the 12th instalment of Rs 6,000 crore to states to meet the GST compensation shortfall, taking the total amount released so far under this window to Rs 72,000 crore. Traders may take note of report that India recorded 9,975 fresh cases of the coronavirus disease (Covid-19), the lowest daily rise since June 8, 2020, resulting in the total active cases in the country falling below 205,500. The death toll has increased to 152,593. India's caseload tally stands at 10,582,647. Meanwhile, as part of pre-Budget deliberations, Finance Minister Nirmala Sitharaman has held a meeting with state finance ministers who suggested steps to revive growth and boost revenue collection against the backdrop of COVID-19 crisis. Banking stocks will be in focus as S&P Global Ratings said India's banking system's low profitability and weak asset quality present some difficulties in significantly boosting digitalisation for several state-owned and smaller private-sector banks. There will be some reaction oil & gas sector stocks with Union Minister for Petroleum and Natural Gas Dharmendra Pradhan's statement that fuel prices had gone up because of lower production in oil-producing nations due to the coronavirus pandemic. This lower production had caused an imbalance in demand and supply. There will be lots of earnings reaction to keep the markets buzzing.


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  • HDFC Bank has reported 18.09% rise in its net profit of Rs 8,758.29 crore for Q3FY21 as against net profit of Rs 7,416.48 crore for Q3FY20. 
  • L&T's construction arm -- L&T construction has secured a large order for its Heavy Civil Infrastructure business from Rail Vikas Nigam in the State of Uttarakhand, India. 
  • TCS has been selected by Three UK, one of the UK's leading mobile network carriers, to help the latter configure its mobile network for its ongoing rollout of 5G services. 
  • NTPC's JV has inked a pact with Petroleum Conservation Research Association for implementation of Energy Efficient PNG Cook Stove programme, across India.
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