Daily Newsletter
NSE Intra-day chart (17 August 2022)
Top Gainers
Company NameClose% Change
Top Losers
Company NameClose% Change
World Indices
IndicesLast Trade% Change
Indices
IndicesLast Trade% Change
FII Activity(Rs. Cr)
DateMarketGross PurchaseGross SalesNet Change
Equity
Debt
Equity
Debt
Equity
Debt
 
Market Commentary 18 August 2022
Markets likely to get cautious start amid weak global cues

 

Indian equity benchmarks extended up move for yet another session and gained over half a percent on Wednesday. Sensex past the psychological 60,000-mark and Nifty inched towards 18000 level on the back of softening inflation and strong FII buying in the current month. After the flat start, the benchmarks gradually inched higher as the day progressed, as traders took some encouragement as State Bank of India's (SBI) Chairman Dinesh Khara said that things might get better on the inflation front towards the end of September. He said the supply side constraints getting addressed and crude oil prices trending low will help ease the situation. Some support also came in as Moody's Analytics in a recent report on the Asia Pacific (APAC) region said global oil prices are expected to fall to almost $70 per barrel by the end of 2024. Domestic sentiments remained optimistic in late afternoon deals, amid a private report stating that companies in India are expected to give a salary hike of 10 per cent in 2023 as they struggle with rising attrition in the tight labour market. Some comfort also came as the UK India Business Council sees opportunities for trade, investment, and collaboration with India across financial technology (fintech), food and beverage, electric vehicle (EV), and other sectors. Traders took a note of a private report that the UK India Business Council sees opportunities for trade, investment, and collaboration with India across financial technology (fintech), food and beverage, electric vehicle (EV), and other sectors. Meanwhile, another private report stated that the Goods and Services Tax (GST) Council may make rate changes in some services or products and withdraw some exemptions in a bid to correct instances of inverted duty. Finally, the BSE Sensex rose 417.92 points or 0.70% to 60,260.13 and the CNX Nifty was up by 119.00 points or 0.67% to 17,944.25.

 

The US markets settled in red on Wednesday with Nasdaq ending lower of over one percent after the Federal Reserve released the minutes of its latest monetary policy meeting. The Fed minutes reaffirmed the central bank's plans to continue raising interest rates in an effort to return inflation to its 2 percent objective. The minutes did not provide specific guidance regarding the pace of future rate hikes, noting that the extent of future policy tightening would depend on the implications of incoming data for the economic outlook and risks to the outlook. The Fed did reveal that meeting participants believed it would be necessary to move to a restrictive stance of policy due to inflation remaining well above the Fed's objective. Traders were also reacting to a Commerce Department report showing US retail sales came in flat in July amid pullbacks in gas station and auto sales. The Commerce Department said retail sales were virtually unchanged in July after climbing by a downwardly revised 0.8 percent in June. Street had expected retail sales to inch up by 0.1 percent compared to the 1.0 percent jump originally reported for the previous month. Excluding gas station and auto sales, however, retail sales rose by 0.7 percent in July, matching the increase seen in the previous month. On the sectoral front, Gold stocks showed a substantial move to the downside on the day, dragging the NYSE Arca Gold Bugs Index down by 3.5 percent. Semiconductor stocks also saw significant weakness on the day, resulting in a 2.5 percent slump by the Philadelphia Semiconductor Index.

 

Crude oil futures ended higher on Wednesday as data showed declines in crude and gasoline inventories in the US in the week ended August 12. Data from US Energy Information Administration (EIA) showed crude stockpiles in the US dropped by 7.1 million barrels last week, nearly three times the expected drop. The data showed gasoline inventories also fell 4.6 million barrels last week, while distillate stockpiles edged up by 0.8 million barrels. The American Petroleum Institute (API) on Tuesday reported a draw for crude oil stocks of 448,000 barrels for the week ended August 12, while analysts predicted a smaller draw of 117,000 barrels. Benchmark crude oil futures for September delivery rose $1.58 or about 1.8 percent to settle at $88.11 a barrel on the New York Mercantile Exchange. Brent crude for October delivery gained $1.31 or 1.42 percent to settle at $93.65 a barrel on London's Intercontinental Exchange.

 

Indian rupee strengthened sharply against the dollar on Wednesday as heavy buying in domestic equities and persistent foreign capital inflows strengthened investor sentiment. Besides, softening crude oil prices and easing inflationary pressures supported the domestic unit. Traders took some encouragement as State Bank of India's (SBI) Chairman Dinesh Khara said that things might get better on the inflation front towards the end of September. He said the supply side constraints getting addressed and crude oil prices trending low will help ease the situation. Some support also came in as Moody's Analytics in a recent report on the Asia Pacific (APAC) region said global oil prices are expected to fall to almost $70 per barrel by the end of 2024. On the global front, the dollar held onto gains against other major currencies on Wednesday, ahead of the release of minutes of the U.S. Federal Reserve's July meeting that could give further clues about the pace of further interest rate hikes. Finally, the rupee ended at 79.45 (Provisional), stronger by 29 paisa from its previous close of 79.74 on Friday.

 

The FIIs as per Wednesday's data were net buyers in equity segment and net sellers in debt segment. In equity segment, the gross buying was of Rs 26139.64 crore against gross selling of Rs 11876.29 crore, while in the debt segment, the gross purchase was of Rs 750.89 crore against gross selling of Rs 927.26 crore. Besides, in the hybrid segment, the gross buying was of Rs 16.30 crore against gross selling of Rs 22.46 crore.

 

The US markets settled lower on Wednesday after minutes from the Federal Reserve's meeting in July suggested policymakers may be less aggressive than previously thought when they raise interest rates in September. Asian markets are trading mostly in red on Thursday following the broadly negative cues from global markets overnight, with weakness across most sectors. Indian markets closed higher on Wednesday, as cooling inflation and buying in PSU bank, power and information technology stocks saw the Sensex vault pass 60,000 after more than four months. Today, markets are likely to make cautious start mirroring weak global cues. Some cautiousness may come as former deputy chairman of the erstwhile Planning Commission Montek Singh Ahluwalia said it would be unrealistic to assume that India would record a sustained growth of 8 per cent, which is needed to become a developed nation by 2047. However, some respite may come later in the day as the ministry of statistics and programme implementation in its final Annual Survey of Industries (ASI) said manufacturing sector investments grew 20.9% in 2019-20 over the previous fiscal. Traders may take note of report that with RBI hiking the lending rate, the Union Cabinet earmarked Rs 34,856 crore towards the interest subvention scheme to help banks provide short term agriculture loans of up to Rs 3 lakh at a rate of 7 per cent. Information and Broadcasting Minister Anurag Singh Thakur said the Cabinet has decided to restore interest subvention on short term agriculture loans to 1.5 per cent for all financial institutions. Besides, foreign institutional investors (FIIs) have net bought shares worth Rs 2,347.22 crore on August 17, as per provisional data available on the NSE. Meanwhile, the Union Cabinet has approved a proposal to increase the limit of the Emergency Credit Line Guarantee Scheme (ECLGS) by Rs. 50,000 crore to Rs. 5 trillion. The additional amount is being earmarked for entities in hospitality and related sectors. There will be some buzz in coal industry stocks as union coal minister Pralhad Joshi said the ministry of coal is targeting production of 900 million tonne (MT) this financial year and national miner Coal India would produce 700 MT coal. Telecom stocks will be in focus as data released by sector regulator Trai showed that telecom subscriber base in the country grew marginally to 117.29 crore in June with Reliance Jio adding maximum number of new customers. There were 117.07 crore subscribers in May 2022. There will be some reaction in oil and gas sector stocks as OPEC in its monthly oil report said that India's demand for petroleum products like petrol and diesel will grow by 7.73 per cent in 2022, the fastest pace in the world. It added that India's demand for oil products is projected to rise from 4.77 million barrels per day (bpd) in 2021 to 5.14 million bpd in 2022.

 

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

 

Index

Previous close

Support

Resistance

NSE Nifty

17,944.25

17,863.09

17,995.69

BSE Sensex

60,260.13

59,970.87

60,436.32

 

Nifty Top volumes

 

Stock

Volume

Previous close (Rs)

Support  (Rs)

Resistance (Rs)

(in Lacs)

Tata Steel

540.08

112.40

111.94

113.19

NTPC

196.74

161.40

159.05

163.70

Tata Motors

159.48

484.65

481.10

491.30

Oil & Natural Gas Corporation

156.94

139.80

138.74

140.84

Hindalco Industries

122.97

438.00

428.94

444.74

 

  • NTPC has floated a tender to raise Rs 5,000 crore term loan from financial institutions. 
  • Bharti Airtel has paid Rs 8312.4 crore to the Department of Telecom towards dues for spectrum acquired in the recently concluded 5G auctions.
  • UPL has collaborated with Oro Agri for the co-distribution and further development of Orange Oil, a biosolution effective against a wide range of pests and diseases.
  • State Bank of India has started insolvency process by filing an insolvency petition against the country's largest sugar firm Bajaj Hindusthan Sugar.
News Analysis