Indian equity benchmarks snapped
6-day winning streak and ended lower on Wednesday on the back of muted global
cues. Markets opened lower and traded in a narrow range throughout the day as
traders turned cautious with a private report that India's unemployment rate
climbed to a four-month high, as there were more people joining the workforce
compared to available jobs in Asia's third largest economy. Creating enough
jobs for India's burgeoning population will remain a key challenge for Prime
Minister Narendra Modi's government, especially as he looks to a third term in
office in national elections due next summer. Some concern also came as the
International Monetary Fund said that economies across the Middle East and
Central Asia will likely slow this year as persistently high inflation and
rising interest rates bite into their post-pandemic gains. The IMF's Regional
Economic Outlook blamed in part rising energy costs, as well as elevated food
prices, for the estimated slower growth. However, losses remained capped as
data released by S&P Global showed that India's services sector surged in
April as the sector's Purchasing Managers' Index (PMI) jumped to 62.0 from 57.8
in March. At 62.0, the services PMI is the highest in nearly 13 years. It has
stayed above the key level of 50 that separates expansion in activity from a
contraction for 21 months in a row. Some support came as data released by the
Reserve Bank of India (RBI) showed that India's services exports shot up by a
record 26.6 per cent in 2022-23 (FY23) to $322 billion, thus closing the gap
with merchandise exports that grew only 6 per cent to $447 billion in the same
period. Besides, provisional data from the National Stock Exchange showed
foreign institutional investors (FII) bought shares worth Rs 1,997.35 crore on
May 2, 2023. Finally, the BSE Sensex fell 161.41 points or 0.26% to 61,193.30
and the CNX Nifty was down by 57.80 points or 0.32% to 18,089.85.
The US markets ended in red on
Wednesday, extending steep losses from the previous session, after the Federal
Reserve announced its widely expected decision to raise interest rates by
another quarter but appeared to signal a potential pause in rate hikes. The Fed
decided to raise the target range for the federal funds rate by 25 basis points
to 5 to 5.25 percent, making the tenth straight rate hike. The unanimous
decision to continue raising rates came as the Fed noted inflation remains
elevated while also observing that job gains have been robust in recent months
and the unemployment rate has remained low. Fed Chair Jerome Powell said the
central bank would take a data-dependent approach to future monetary policy
decisions and stressed a decision on a pause was not made at the meeting. The
next monetary policy meeting is scheduled for June 13-14, with CME Group's
FedWatch Tool currently indicating an 87.1 percent chance the Fed will leave
rates unchanged. On the sectoral front, oil service stocks extended the
sell-off seen during trading on Tuesday, with a continued nosedive by the price
of crude oil weighing on the sector. With crude for June delivery plummeting
$3.06 to $68.60 a barrel, the NYSE Arca Oil Index tumbled by 2.2 percent to its
lowest closing level in over a month. Substantial weakness also emerged among
financial stocks, dragging the NYSE Arca Broker/Dealer Index and the KBW Bank
Index down by 2.2 percent and 1.9 percent, respectively.
Crude oil futures ended deeply
lower on Wednesday, magnifying their previous session's losses, after the U.S.
Federal Reserve raised interest rates. Crude oil prices fell on concerns about
economic growth and the outlook for energy demand as well as data showing an
increase in gasoline inventories. Meanwhile, data released by Energy
Information Administration (EIA) showed gasoline inventories rose by 1.7
million barrels last week compared to an expected drop of 1.2 million barrels.
However, data showed that crude inventories dropped by 1.3 million barrels last
week versus forecasts for a 1.1 million barrel drop. Benchmark crude oil
futures for June delivery fell $3.06 or 4.3 percent to settle at $68.60 a
barrel on the New York Mercantile Exchange. Brent crude for July delivery
dropped $2.99 or 4 percent to settle at $72.33 a barrel on London's
Intercontinental Exchange.
Indian Rupee ended higher against
the US dollar on Wednesday tracking the weakness of the American currency in
the overseas market. Sentiments were upbeat after data released by S&P
Global showed that India's services sector surged in April as the sector's
Purchasing Managers' Index (PMI) jumped to 62.0 from 57.8 in March. At 62.0,
the services PMI is the highest in nearly 13 years. It has stayed above the key
level of 50 that separates expansion in activity from a contraction for 21
months in a row. On the global front, Russian rouble climbed near to a
one-month high against a globally weaker U.S. dollar on Wednesday, brushing
aside a slide in oil prices as traders awaited two government debt auctions.
Dollar fell on Wednesday, ahead of an expected rise in U.S. interest rates, and
as gloomy jobs data, a standoff over the U.S. debt ceiling and nervousness
following banking collapses clouded the investment outlook. Finally, the rupee
ended at 81.81 (Provisional), stronger by 6 paise from its previous close of
81.87 on Tuesday.
The FIIs as per Wednesday's data
were net buyers in equity segment, while net sellers in debt segment. In equity
segment, the gross buying was of Rs 10113.21 crore against gross selling of Rs
7121.48 crore, while in the debt segment, the gross purchase was of Rs 660.43
crore against gross selling of Rs 1695.73 crore. Besides, in the hybrid
segment, the gross buying was of Rs 24.35 crore against gross selling of Rs
11.55 crore.
The US markets ended lower on
Wednesday after the Federal Reserve hiked rates by another 25 basis points and
investors' fears of contagion in the regional bank space returned. Asian
markets are trading mostly in green on Thursday despite overnight fall on Wall
Street. Indian markets ended lower on Wednesday amid concerns about interest
rate hikes and the likely impact on global economic growth. Today, start of
session is likely to be cautious tracking overnight losses on Wall Street post
US Federal Reserve's 25 bps rate increase and hinted of a likely pause
thereafter. Also, there may be some volatility in today's session ahead of
weekly F&O expiry. Traders will be concerned with report that the Centre
has advised states to be prepared for worst situation and ensure adequate
availability of seeds for kharif sowing season in case of less rainfall, amid
concerns over possible impact of evolving El Nino conditions on monsoon rains.
Traders may take note of a report that India needs to introduce a broad-based
carbon pricing system to meet its climate goals. The report also stated the
need to bring about an effective green taxonomy so that sustainable green
assets and activities can be identified and the potential risk of green washing
can be limited. However, foreign fund inflows likely to aid domestic
sentiments. Foreign institutional investors (FII) bought shares worth Rs 1,338
crore on May 3, provisional data from the National Stock Exchange showed. Some
support will come later in the day as a Ficci-EY report noted that the Indian
media and entertainment (M&E) sector grew 20 per cent in 2022 to reach Rs
2.1 trillion, 10 per cent above its pre-pandemic levels in 2019. Meanwhile, a
Reserve Bank report said India's green financing requirement is estimated to be
at least 2.5 per cent of GDP annually till 2030. The country aims to achieve
net zero emissions target by 2070. Stocks of airlines like IndiGo, SpiceJet,
Jet Airways, are likely to be on investors radar for the second day running as
crisis-hit Go First has reportedly stopped taking fresh bookings for its
flights till May 15. The NCLT will hear the insolvency plea today. Besides,
Adani Enterprises, Blue Star, Bombay Dyeing, Ceat, Dabur, HDFC, Hero MotoCorp,
IDFC, J&K Bank, Mindspace Business Parks, Punjab Chemicals, Sundaram
Fasteners, Tata Power, TVS Motor and United Breweries are few of the prominent
companies scheduled to announce Q4 earnings later in the day.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
18,089.85
|
18,049.39
|
18,123.34
|
BSE
Sensex
|
61,193.30
|
61,053.50
|
61,304.02
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata
Steel
|
512.33
|
109.60
|
108.56
|
110.81
|
ICICI
Bank
|
187.01
|
921.20
|
913.89
|
926.19
|
Axis
Bank
|
150.95
|
859.45
|
853.39
|
866.19
|
HDFC
Bank
|
147.03
|
1692.45
|
1682.74
|
1699.09
|
NTPC
|
111.94
|
176.10
|
174.59
|
178.14
|
Tata Steel has reported fall of 84.08% in its consolidated net profit at Rs 1566.24 crore for Q4FY23 as compared to Rs 9835.12 crore for the same quarter in the previous year.
NTPC has recorded 2.75 MMT of coal production during the month of April 2023 as compared to 1.11 MMT recorded for the month of April 2022, an over two-fold jump.
JSW Steel's subsidiary -- JSW Steel USA Ohio has planned to invest $145 million in new projects to upgrade its manufacturing operations in Mingo Junction, Ohio.
Infosys and SolarWinds have collaborated to advance the shift of SolarWinds solutions to a new SaaS model.