Indian equity benchmarks ended
higher by around a percent on Tuesday led by heavy buying in index majors
Larsen & Toubro, Hindustan Unilever and HDFC. After making a cautious
start, key gauges gained traction as traders took encouragement with the
Reserve Bank of India's (RBI) report stating that states' gross fiscal deficit
(GFD) is budgeted to decline from 4.1 per cent of gross domestic product (GDP)
in Covid-hit 2020-21 to 3.4 per cent of GDP in 2022-23 showing improvement in
their fiscal health. It stated the fiscal health of the states has improved
from a sharp pandemic-induced deterioration in 2020-21 on the back of a
broad-based economic recovery and resulting high revenue collections.
Sentiments remained up-beat with a private report that nearly six in 10
corporate heads in India (57 per cent) are optimistic about the country's
growth prospects in 2023 in the face of a global slowdown, as well as
inflationary and geopolitical concerns. Some support also came with report that
the ongoing negotiations of India for the proposed comprehensive free trade agreements
with the UK and European Union (EU) are on track and the next round of talks
with both the regions will happen soon. However, markets trimmed some gains in
afternoon deals, as some concern came with the provisional data available on
the NSE showing that foreign institutional investors (FIIs) net sold shares
worth Rs 750.59 crore, continuing selling for the 17th consecutive session on
January16, 2023. But, key indices regained traction to end near day's high
points, taking support from Mathias Cormann's, the secretary-general of the
Organisation for Economic Co-operation & Development (OECD) statement that
India has been growing very strongly - and as a key player in G20, India holds
opportunity to help shape the global agenda. Meanwhile, the World Economic
Forum in its Chief Economists Outlook survey said that a global recession is
likely in 2023, but pressures on food, energy and inflation may be peaking. It
added at the same time, some economies in the South Asia region, including
Bangladesh and India, may bene?t from global trends such as a diversi?cation of
manufacturing supply chains away from China. Finally, the BSE Sensex rose
562.75 points or 0.94% to 60,655.72 and the CNX Nifty was up by 158.45 points
or 0.89% to 18,053.30.
The US markets ended mostly in
red on Tuesday with Dow Jones settling over one percent cut. A steep drop by
Goldman Sachs (GS) weighed on the Dow, with the financial giant plunging by 6.4
percent on the day. The nosedive by shares of Goldman Sachs came after the
company reported fourth quarter earnings that missed Street estimates. Fellow
Dow Component Travelers (TRV) also plunged by 4.6 percent after warning of
weaker than expected fourth quarter earnings due to the significant winter
storm that impacted much of the U.S and Canada in late December. The choppy
trading on markets came as traders expressed some uncertainty about the
near-term outlook for the markets following recent strength. On the sectoral
front, most of the major sectors showed only modest moves on the day, contributing
to the lackluster performance by the broader markets. Gold stocks showed a
substantial move to the downside, however, dragging the NYSE Arca Gold Bugs
Index down by 3.5 percent. The index ended last Friday's trading at a
seven-month closing high. Retail and
steel stocks also saw notable weakness on the day, while oil service stocks
moved higher along with the price of crude oil. On the economic data front, the
New York Federal Reserve released a report showing a significant contraction in
regional manufacturing activity in the month of January. The New York Fed said
its general business conditions plunged to a negative 32.9 in January from a
negative 11.2 in December, with a negative reading indicating a contraction.
Street had expected the index to climb to a negative 4.5.
Crude oil futures ended higher on
Tuesday on account of expectations of a rise in demand for fuel after data
showed the Chinese economy saw better than expected growth last year. Official
data showed that China's GDP grew an annual 2.9% in the fourth quarter, faster
than the 1.8% increase street had expected. Meanwhile, oil was bolstered by a
weaker U.S. dollar, which fell against most major currencies due to
expectations of a possible Bank of Japan policy shift that could be a precursor
to adopting a tighter monetary policy. Benchmark crude oil futures for February
delivery rose $0.32 or 0.4 percent at $80.18 a barrel on the New York
Mercantile Exchange. Brent crude for March delivery surged $1.46 or 1.7 percent
at $85.92 a barrel on London's Intercontinental Exchange.
Rupee ended weaker against dollar
on Tuesday amid firm crude oil prices. Sentiments got hit despite Reserve Bank
of India (RBI) in its report has said states' gross fiscal deficit (GFD) is
budgeted to decline from 4.1 per cent of gross domestic product (GDP) in
Covid-hit 2020-21 to 3.4 per cent of GDP in 2022-23 showing improvement in
their fiscal health. It stated the fiscal health of the states has improved
from a sharp pandemic-induced deterioration in 2020-21 on the back of a
broad-based economic recovery and resulting high revenue collections. On the
global front, British pound edged higher on Tuesday after data showed a tight
labour market and accelerating pay growth, adding to the Bank of England's
inflation worries as it tries to bring prices down from multi-decade highs. Finally,
the rupee ended at 81.77 (Provisional), weaker by 19 paise from its previous
close of 81.58 on Monday.
The FIIs as per Tuesday's data
were net buyers in both equity and debt segment. In equity segment, the gross
buying was of Rs 8515.82 crore against gross selling of Rs 6945.09 crore, while
in the debt segment, the gross purchase was of Rs 607.17 crore against gross
selling of Rs 198.03 crore. Besides, in the hybrid segment, the gross buying
was of Rs 2.04 crore against gross selling of Rs 12.90 crore.
The US markets ended mostly in
red on Tuesday as the corporate earnings season took center stage. Asian
markets are trading mostly higher on Wednesday as investors await the outcome
of the Bank of Japan's monetary policy meeting. Indian markets shrugged off
lackluster global cues and ended higher on Tuesday, buoyed by strong buying
interest in index heavyweights Reliance Industries and the HDFC twins. Today,
the benchmark indices are likely to get flat-to-positive start tracking gains
in Asian counterparts. Foreign fund inflows likely to support domestic
sentiments. Foreign institutional investors (FII) turned net buyers for the
first time in last 18 straight sessions, to the tune of Rs 211.06 crore worth
shares on January 17, as per provisional data available on the NSE. Traders may
take note of Former RBI governor Raghuram Rajan's statement that it is too
premature to think that India will replace China when it comes to influencing
global economic growth. However, the situation may change going forward as
India is already the world's fifth largest economy, it is growing and has the
potential to keep expanding. However, there may be some cautiousness as State
Bank of India in a report stated that the upcoming Indian budget for 2023-24
will be a challenging one for the government to follow the roadmap for fiscal
consolidation amidst a global environment of declining inflation. It said the
fiscal deficit of the Indian government for FY23 will be about Rs.17.5 lakh
crore. There will be some buzz in mines and mineral industry stocks as the
mines ministry said the country's mineral production rose by 9.7 per cent in
November as compared to the year-ago period. Banking stocks will be in focus
ahead of the finance ministry meeting, to be held on January 19, with heads of
public sector banks and financial institutions to review the progress of
various social sector schemes, including Jan Dhan, Mudra, KCC, and PM SVANidhi.
There will be some reaction in infrastructure industry stocks as rating agency
ICRA said that toll road projects in the country are likely to see moderate to
high single-digit growth in FY24 with moderation in the Wholesale Price Index
(WPI) inflation. India's toll road projects saw a 17-20 per cent growth in
FY23. Sugar industry stocks will be in limelight as industry body ISMA said
sugar mills have entered into contracts to export 55 lakh tonne of sweetener so
far in current marketing year ending September and out of that, 18 lakh tonne
have been shipped already. There will be lots of earnings reaction to keep the
markets buzzing.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
18,053.30
|
17,936.15
|
18,121.25
|
BSE
Sensex
|
60,655.72
|
60,250.54
|
60,882.68
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Steel
|
278.80
|
119.30
|
118.24
|
120.14
|
Oil & Natural Gas Corporation
|
184.84
|
147.45
|
146.40
|
148.75
|
ITC
|
137.12
|
332.00
|
329.56
|
333.96
|
State Bank of India
|
134.61
|
593.40
|
584.30
|
604.25
|
NTPC
|
130.15
|
167.60
|
166.20
|
168.60
|
NTPC's wholly owned subsidiary -- NTPC RE has signed a MoU with Government of Tripura for Development of Floating and Ground Mounted based Renewable Energy Projects in the State of Tripura.
Bharti Airtel has launched its cutting edge 5G services in Jaipur, Udaipur and Kota.
SBI has inked a MoU with Warehousing Development Regulatory Authority to help farmers in getting low interest rate loans.
Mahindra & Mahindra has unveiled prices for XUV400, its first electric SUV.