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NSE Intra-day chart (18 October 2021)
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Market Commentary 19 October 2021
Markets likely to get optimistic start on positive Asian cues


Continuing with the momentum seen in the past week, Indian equity benchmarks settled at fresh record closing highs on Monday, on the back of strength in select metal, utilities and power stocks. Markets made positive start and stayed in green for whole day, as sentiments got boost with Minister of State for External Affairs V Muraleedharan's statement that the Indian economy is bouncing back strongly, domestic consumption is increasing and industrial production is at pre-COVID level, he also emphasized that the reforms implemented by the government has provided fillip to the business ecosystem in the country. Additional optimism also came as Union Finance Minister Nirmala Sitharaman stating that the Indian government remains committed to bring the economy on the path of fiscal consolidation in the near-to-medium term, setting the target to reduce fiscal deficit to 4.5 per cent by 2025-26. Markets continued to trade firm in afternoon session, taking support from the International Monetary Fund's (IMF) report in which it has described the Indian government's response to the COVID-19 situation as 'swift and substantial', adding that the country continued with labour reforms and privatization despite the pandemic. Some support also came after RBI data stated that the country's foreign exchange reserves rose by $2.039 billion to 639.516 billion in the week ended October, 8. Market participants paid no heed towards report stated that the sharp economic recovery and rising demand post the second wave of Covid coupled with a spike in global oil prices may pose a challenge for the government in FY22 to maintain fiscal discipline amid good growth in tax revenue.  Traders overlooked data released by the government showed India's merchandise trade deficit widened to a record $22.6 billion in September, the highest in at least about 14 years, as crude oil and gold imports surged.  Finally, the BSE Sensex rose 459.64 points or 0.75% to 61,765.59 and the CNX Nifty was up by 138.50 points or 0.76% to 18,477.05.


The US markets ended mostly higher on Monday as investors bet on a continuation of strong earnings reports from major companies. A number of big names are set to report in the week ahead, including Netflix, Johnson & Johnson, United Airlines and Procter & Gamble on Tuesday. Tesla, Verizon and IBM are among the other names on deck for the week. Strong results from the first week of earnings, including from the largest banks, have pushed the markets higher. However, upside remained capped as the Federal Reserve in its latest report has said that industrial production in the US unexpectedly showed a steep drop in the month of September. The Fed said industrial production tumbled by 1.3 percent in September following a revised 0.1 percent dip in August. The sharp decline surprised participants, who had expected industrial production to edge up by 0.2 percent compared to the 0.4 percent increase originally reported for the previous month. The report said manufacturing output fell by 0.7 percent, with the production of motor vehicles and parts plunging by 7.2 percent amid the semiconductor shortage. Utilities output also plummeted by 3.6 percent, as demand for cooling subsided after a warmer-than-usual August, while mining production slumped by 2.3 percent due to the lingering effects of Hurricane Ida. Besides, worries about the global economic outlook also weighed on the markets after data showed the Chinese economy hit its slowest pace of growth in a year in the third quarter, hurt by power shortages, supply bottlenecks, sporadic Covid-19 outbreaks and major wobbles in the property sector. China's GDP expanded 4.9 percent year-on-year in the third quarter of 2021, the National Bureau of Statistics said, missing forecasts for 5.2 percent and down sharply from 7.9 percent in the three months prior.


Crude oil futures ended higher on Monday amid expectations that global energy demand will continue to rise following several countries easing travel restrictions. Further, energy crisis in China and several parts of Europe sent coal prices soaring to record levels, pressuring power-generation companies and manufacturers to switch to using oil as the world economy reopens. Besides, cold temperatures in the northern hemisphere are also expected to worsen an oil supply deficit. Benchmark Crude oil futures for November delivery rose $0.16 or about 0.2 percent to settle at $82.44 barrel on the New York Mercantile Exchange. However, Brent crude for December delivery declined $0.69 or about 0.8 percent to settle at $84.17 a barrel on London's Intercontinental Exchange.


Indian rupee ended significantly lower on Monday on account of sustained dollar demand from importers and banks. Sentiments remained fragile as data released by the government showed India's merchandise trade deficit widened to a record $22.6 billion in September, the highest in at least about 14 years, as crude oil and gold imports surged. Also, jump in global crude oil prices, continued to dampen investors' sentiment for the Indian currency by worsening the outlook on domestic inflation and the country's trade deficit. On the global front, dollar headed back on Monday towards a one-year high hit last week as rising inflation expectations and higher bond yields boosted its appeal against its rivals. Finally, the rupee ended 75.35, weaker by 9 paise from its previous close of 75.26 on Thursday.


The FIIs as per Monday's data were net buyers in equity segment, while net sellers in debt segment. In equity segment, the gross buying was of Rs 10654.50 crore against gross selling of Rs 9175.84 crore, while in the debt segment, the gross purchase was of Rs. 711.85 crore with gross sales of Rs 1079.20 crore. Besides, in the hybrid segment, the gross buying was of Rs 29.59 crore against gross selling of Rs 15.59 crore.


The US markets ended mostly higher on Monday with the biggest boosts from the highest-profile technology and communications companies, though a relentless surge in oil prices fuelled concerns about elevated inflation. Asian markets are trading in green on Tuesday supported by a tech-driven Wall Street rally, and a rebound in Chinese markets a day after weak data heightened investor concerns about the world's second-largest economy. Indian markets extended its winning run for the sixth-straight day on Monday on the back of aggressive buying in metal and select IT and financial shares. Today, the markets are likely to continue Bull Run with positive start tracking gains in global markets. Traders will be taking encouragement as Union Minister Shobha Karandlaje said the Centre has infused Rs 1,31,000 crore to boost agriculture and allied sectors with special emphasis on becoming an export-oriented economy as India has tremendous potential to satiate global demand. Some support will come as preliminary data of the commerce ministry showed that the country's exports rose by 40.5 per cent to $15.13 billion during October 1-14 on account of healthy performance by key sectors such as petroleum products, engineering and chemicals. Additionally, amid a growing perception, partly caused by a view expressed by some senior government functionaries against another instalment of a large demand-side fiscal stimulus in the current fiscal, Finance Minister Nirmala Sitharaman indicated that the government was indeed open to accelerating the economic recovery through such largesse, if required. Meanwhile, Reserve Bank of India (RBI) remained a net buyer of the US currency in August after it net purchased $3.747 billion from the spot market. According to the monthly RBI bulletin for October 2021, in the reporting month, RBI had purchased $10.887 billion and sold $7.14 billion in the spot market. Aviation industry stocks will be in focus as the country's aviation regulator -- the Directorate General of Civil Aviation (DGCA) said around 70.66 lakh domestic passengers travelled by air in the month of September, 5.44 per cent higher than 67.01 lakh who travelled in August. There will be some reaction in solvent extraction industry stocks as industry body SEA said export of oilmeal, used as animal feed, declined 36 per cent year-on-year to 1.83 lakh tonne in September on account of the domestic shortage of the oilmeal products. There will be some earnings announcements too to keep the markets buzzing.


Support and Resistance: NSE (Nifty) and BSE (Sensex)



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Tata Motors










Power Grid Corporation of India










HCL Technologies






  • Tata Motors has launched its latest offering in its New Forever range of SUVs, Tata Punch, India's first sub-compact SUV. 
  • HCL Technologies has launched its TechBee early career program in Vietnam with plans to onboard 2,600 candidates in the next five years, starting in 2021. 
  • TCS has been selected as a strategic partner by Cainz Corporation, to accelerate its digital transformation, improve customer experience, and drive growth. 
  • Infosys has inked a new collaboration with Brent Council to make high-quality digital education accessible to every Brent resident and boost employability skills through its digital learning and training program, Infosys Springboard.
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