Indian equity
benchmarks ended flat with negative bias after a highly volatile session on
Tuesday. After making slightly positive start, markets soon slipped into red
territory, as traders were concerned as India reported 31,222 new cases of
Covid-19 and 290 deaths from the disease in 24 hours. Some cautiousness also
came in as a private report projected a real gross value added (GVA) growth of
7 to 8 per cent year-on-year in the second quarter of current fiscal year
versus 20.1 per cent growth in Q1 FY22. It said estimates suggest some
moderation in economic activity index (EAI)-GVA growth in July, largely on
account of weaker fiscal spending. Traders took note of a private report stated
that industries have raised red flags over fresh notices being issued denying
input tax credit (ITC), alleging wrongful claims, in turn leading to hardships
for businesses. The markets, however, surrendered all their losses to trade in
the positive note in noon session, taking support from RBI's data showing that
sales of 1,647 listed private manufacturing companies recorded extraordinarily
high growth of 75 per cent in the first quarter of FY'22 mainly due to a very
low base in the pandemic-hit year-ago period. Some support also came with
report stated that sales growth (y-o-y) of information technology (IT) sector
companies, which remained in the positive terrain throughout the pandemic,
accelerated to 17.5 per cent in first three months period of 2021-22 from 6.4 per
cent in the previous quarter. In absolute term, the sales were worth about Rs
1,13,807 crore. But, indices but failed to hold onto gains and ended the day
with marginal losses, due to profit-booking at higher levels. Meanwhile,
Capitals markets regulator SEBI (Securities and Exchange Board of India) has
banned 85 entities from capital markets for up to one year for fraudulent
trading practices. Finally, the BSE Sensex fell 17.43 points or 0.03% to
58,279.48, while the CNX Nifty was down by 15.70 points or 0.09% to 17,362.10.
The US markets settled mostly
lower on Tuesday on lingering concerns about the delta variant's impact on the
economic reopening. Goldman Sachs downgraded its economic outlook over the
weekend, citing the delta variant and fading fiscal stimulus. Goldman now sees
5.7% annual growth in 2021, below the 6.2% consensus. The firm cut its
fourth-quarter GDP outlook to 5.5%, down from 6.5%. Goldman stated the hurdle
for strong consumption growth going forward appears much higher: the delta
variant is already weighing on Q3 growth, and fading fiscal stimulus and a
slower service sector recovery will both be headwinds in the medium term. Boeing
shares were lower after private report stated that deliveries for the 787
Dreamliner would likely be further delayed. PPG Industries, a paint maker,
warned that sales may fall short this quarter because of logistics issues and
higher commodity costs. Shares of PPG Industries ticked nearly 3.4% lower.
However, travelers Companies climbed more than 2.5 percent. Walt Disney shares
gained about 1.8 percent and Apple surged up 1.4 percent. Netflix gained more
than 2.5 percent, and Amazon ended nearly 1 percent up. Shares of medical
device manufacturer Tandem Diabetes Care, Inc soared more than 13 percent,
buoyed by reports the company is set to enter the S&P MidCap 400 effective
from September 20.
Crude oil futures ended lower on
Tuesday amid renewed worries about the outlook for energy demand due to
continued surge in coronavirus cases in several countries. The drop in prices
was also due to Saudi Arabia's decision to slash crude prices for Asia.
Further, uncertainty about the pace of global economic recovery following last
week's somewhat disappointing US non-farm payrolls data also weighed on oil
prices. However, data showing a strong rebound in China's imports and exports
capped oil's losses. China's exports increased by 25.6% year-on-year in August,
beating street's forecast of 17.1%. In July, exports surged up 17.1%. Imports
were up 33.1% annually in August, after a 28.1% increase a month earlier.
China's trade surplus stood at $58.34 billion in August, well above the
expected level of $51.05 billion. Crude oil futures for October fell $0.94 or
1.4 percent to settle $68.35 barrel on the New York Mercantile Exchange.
November Brent crude dropped $0.61 or 0.85% percent to settle at $71.61 a
barrel on London's Intercontinental Exchange.
Extending losses for the second
straight session, Indian rupee ended considerably lower against dollar on
Tuesday, on account of sustained dollar demand from importers and banks.
Traders were worried as India reported 31,222 new cases of Covid-19 and 290 deaths
from the disease in 24 hours. Some cautiousness came in as a private report
projected a real gross value added (GVA) growth of 7 to 8 per cent year-on-year
in the second quarter of current fiscal year versus 20.1 per cent growth in 1Q
FY22. On the global front, Sterling dipped for a second consecutive day against
a broadly stronger dollar on Tuesday, adding to losses sustained at the start
of the week on stuttering economic momentum in Britain. Finally, the rupee
ended 73.42, weaker by 32 paise from its previous close of 73.10 on Monday.
The FIIs as per Tuesday's data
were net buyer in both equity and debt segment. In equity segment, the gross
buying was of Rs 6380.01 crore against gross selling of Rs 5960.07 crore, while
in the debt segment, the gross purchase was of Rs 1156.36 crore against gross
selling of Rs 930.29 crore. Besides, in the hybrid segment, the gross buying
was of Rs 31.82 crore against gross selling of Rs 17.94 crore.
The US markets ended mostly in
red on Tuesday as traders returned from the Labor Day holiday, even as gains
for some Big Tech companies nudged the Nasdaq composite barely higher. Asian
markets are trading mostly lower on Wednesday with Japan revising upward its
estimates for second-quarter growth. Indian markets closed flat and snapped a
three-day gaining streak as IT, banks, and realty stocks dragged indices down.
Today, the markets are likely to make flat-to-positive start amid mixed global
cues. Some support will come as the finance ministry said income taxpayers can
file applications before the interim board for settlement of pending tax cases
at the Income Tax Settlement Commission (ITSC) level by September 30. The
Finance Act, 2021, has amended the provisions of the Income Tax Act, 1961, to
provide that the ITSC shall cease to operate with effect from February 1, 2021.
Additionally, In a major move towards making domestic markets more liquid,
capital markets regulator SEBI, on Tuesday introduced T+1 settlement cycle for
completion of share transactions on an optional basis. Traders may take note of
Food and Consumer Affairs Minister Piyush Goyal's statement that agriculture
exports have an important role to play in doubling farmers' income, and
stressed the need for boosting India's outward shipments to be among top-5
nations in farm exports. However, traders may be concerned as Fitch Ratings
said India continues to lag way behind in COVID vaccination, and the negative
outlook on sovereign rating signifies the rising debt-to-GDP ratio. In April
2021, Fitch affirmed India's sovereign rating at BBB- with a negative outlook.
It added vaccination is the key to economic recovery across the world.
Meanwhile, the commerce ministry's investigation arm DGTR has recommended the
imposition of anti-dumping duty on Vitamin C, used by pharmaceutical firms for
medicine production, from China to guard domestic manufacturers from cheap
imports. Shares of InterGlobe Aviation, SpiceJet and other airlines may also
trade choppy as Minister of Civil Aviation Jyotiraditya Scindia is slated to
hold a press conference later in the day. Banking stocks will be in limelight
as India Ratings and Research (Ind-Ra) maintained a stable outlook on the
overall banking sector for the rest of FY22, supported by the continuing
systemic support. Telecom stocks will be
in focus with report that the Union Cabinet is likely to consider and discuss a
relief package for the sector on Wednesday. There will be some reaction in
insurance industry stocks with a private report that after witnessing a
double-digit contraction in new business premium (NBP) in July, life insurers
are back in the green again, witnessing a marginal year-on-year (YoY) growth of
3 per cent in NBP in August, owing to a strong performance by the private
insurers.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
17,362.10
|
17,386.90
|
17,386.90
|
BSE
Sensex
|
58,279.48
|
58,005.35
|
58,553.35
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
ITC
|
374.89
|
211.75
|
209.81
|
214.01
|
Bharti Airtel
|
276.65
|
670.55
|
652.20
|
684.70
|
State Bank of India
|
149.28
|
429.10
|
425.56
|
432.16
|
Tata Motors
|
143.25
|
294.60
|
291.06
|
297.96
|
Coal India
|
94.75
|
147.20
|
145.80
|
148.35
|
L&T's construction arm has secured significant order for its Water and Effluent Treatment business in India.
Infosys has almost completed its buyback programme and its buyback committee will meet on September 8 to consider closure of the buyback programme.
Dr. Reddy's Laboratories has launched the prescription drug Minoxidil topical solution USP 2% and 5% for the treatment of female pattern hair loss.
Eicher Motors' motorcycle arm -- Royal Enfield has launched the all-new Classic 350 model in Rajasthan market.