Indian equity
markets ended with marginal gains in the volatile session on Wednesday as
investors across the globe remained in a cautious mood ahead of a key interest
rate decision in the world's largest economy due later in the day. After the
initial uptick, markets turned lower as traders got cautious with the Reserve
Bank of India's data in the March 2024 bulletin showing that the net foreign
direct investment (FDI) in India, inflows minus outflows, declined 38.4 per
cent year-on-year to $15.41 billion in the first 10 months of this financial
year due to an increase in the repatriation of capital. As per the data, FDI in
India was $25.53 billion and outflows were $10.11 billion in April 2023-January
2024. However, markets recouped early morning losses to trade in green in
afternoon deals, as traders took support with an article on the State of
Economy published in the Reserve Bank of India's (RBI) March Bulletin showing
that India can sustain 8 per cent annual GDP growth and the conducive
macroeconomic configuration may become a launching pad for a step-up in the
country's growth trajectory. Some support also came with the Central Board of
Direct Taxes (CBDT) stating that the provisional figures of net direct tax
collections registered a growth of 19.88 per cent to Rs 18,90,259 crore for the
financial year 2023-24 (as of March 17, 2024) as compared to Rs 15,76,776 crore
in the corresponding period of the previous financial year (FY 2022-23), on
higher advance tax mop-up. Key gauges trimmed some gains in final minutes of
trade but managed to end with mild gains supported by gains in heavyweight
stocks like Maruti Suzuki, Power Grid Corporation and Nestle. Finally, the BSE
Sensex rose 89.64 points or 0.12% to 72,101.69 and the CNX Nifty was up by
21.65 points or 0.10% to 21,839.10.
The US markets ended sharply
higher on Wednesday after the Fed announced its widely expected decision to
leave interest rates unchanged but also maintained its forecast for three rate
cuts this year. In support of its dual goals of maximum employment and inflation
at a rate of 2 percent over the longer run, the Fed said it once again decided
to maintain the target range for the federal funds rate at 5.25 to 5.50
percent. The target range for the federal funds rate has remained unchanged
since the Fed raised rates by a quarter point last July. While the accompanying
statement said Fed officials still need greater confidence inflation is moving
sustainably toward 2 percent before cutting rates, the projections still point
to three rate cuts this year. The latest projections suggest Fed officials
expect rates to be lowered to a range of 4.50 to 4.75 percent by the end of
2024. The interest rate forecast is unchanged from December and points to three
quarter point rate cuts over the next nine months. On the sectoral front,
Airline stocks moved sharply higher over the course of the session, with the
NYSE Arca Airline Index soaring by 3.8 percent after ending Tuesday's trading
at its lowest closing level in well over a month. Substantial strength also
emerged among gold stocks, as reflected by the 3.8 percent spike by the NYSE
Arca Gold Bugs Index. The rally by gold stocks came as the price of the
precious metal surged in afterhours trading. Banking stocks also showed a
significant move to the upside on the day, driving the KBW Bank Index up by 2.4
percent to its best closing level in a year.
Crude oil futures ended lower on
Wednesday as traders chose to take some profits. Further, a firm dollar weighed
on oil prices. Oil prices fell despite data showing an unexpected drop in crude
oil inventories in the week ended March 15. Data from the Energy Information
Administration (EIA) showed crude inventories in the U.S. dropped by nearly 2
million barrels last week versus expectations for a slight increase. The EIA
data also showed gasoline inventories slumped by 3.3 million barrels last week,
while distillate stockpiles edged up by 0.6 million barrels in the week. Benchmark
crude oil futures for April delivery dropped $1.79 or about 2.1% to settle at
$81.68 a barrel on the New York Mercantile Exchange. Brent crude for May
delivery fell by $1.43 or about 1.66% to $85.95 per barrel on London's
Intercontinental Exchange.
Indian rupee depreciated against
the dollar on Wednesday weighed down by a strong American currency against
major rivals overseas and elevated crude oil prices. Some cautiousness came in
as the Reserve Bank of India's data in the March 2024 bulletin showed that the
net foreign direct investment (FDI) in India, inflows minus outflows, declined
38.4 per cent year-on-year to $15.41 billion in the first 10 months of this
financial year due to an increase in the repatriation of capital. As per the
data, FDI in India was $25.53 billion and outflows were $10.11 billion in April
2023-January 2024. On the global front, U.S. dollar edged up while the yen
remained around its multi-month low on Wednesday ahead of the Federal Reserve
policy meeting and after the Bank of Japan (BOJ) raised interest rates for the
first time in 17 years. Finally, the rupee ended at 83.19 (Provisional), weaker
by 16 paise from its previous close of 83.03 on Tuesday.
The FIIs as per Wednesday's data
were net buyers in equity segment, while they were net sellers in debt segment.
In equity segment, the gross buying was of Rs 17223.87 crore against gross
selling of Rs 15872.80 crore, while in the debt segment, the gross purchase was
of Rs 1231.91 crore with gross sales of Rs 1666.67 crore. Besides, in the
hybrid segment, the gross buying was of Rs 25.18 crore against gross selling of
Rs 25.10 crore.
The US markets ended in green on
Wednesday as the US Federal Reserve kept its forecast for three rate cuts this
year unchanged, while delivering a status quo outcome on the key interest rate.
Asian markets are trading higher on Thursday tracking overnight gains on Wall
Street. Indian markets ended volatile session slightly in green on Wednesday as
weakness in financial stocks offset strength in auto, FMCG and energy shares.
Today, domestic indices are likely to make gap-up opening tracking broadly positive
cues from global peers. Overnight in the US, the Fed kept its interest rates
unchanged and stuck on its promise of three rate cuts in the current calendar
year. Some support will come after CareEdge Ratings said India's economic
activity likely hit a nine-month high in February, despite rural demand
remaining weak and unemployment rising, thanks to a sharp expansion in exports,
imports and corporate bond issuances. The CareEdge Economic Meter, a composite
index covering 18 high-frequency economic indicators to track the state of the
economy, suggested a 10.3% year-on-year uptick in activity levels. Traders may
take note of India's executive director at International Monetary Fund (IMF)
Krishnamurthy Venkata Subramanian's statement that India needs to grow at 8 per
cent on sustained basis to create sufficient jobs to reduce poverty and
inequality. India's economy grew by better-than-expected 8.4 per cent in the
final three months of 2023 - the fastest pace in one-and-half years. He said We
should be impatient even if we grow at 7 per cent. We should be looking to grow
at 8 per cent and above, as the country needs to create a lot of infrastructure.
However, some cautiousness may come amid foreign fund outflows. Foreign
institutional investors (FIIs) net sold shares worth Rs 2,599.19 crore on March
20, provisional data from the NSE showed. Besides, Prime Minister Narendra Modi
said India will lead the world in AI capabilities, and exhorted young
entrepreneurs and startups to work on Indian solutions for global applications
to solve challenges faced by nations across the world. Metal stocks will be in
focus with a private report that Indian sponge iron producers have urged the
government to impose duties on exports of low-grade iron ore to stave off shortages
of the main raw material in the world's second-biggest crude steel producer.
Meanwhile, Krystal Integrated Services will make its market debut today against
an issue price of Rs 715 per share.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
21,839.10
|
21,722.56
|
21,943.26
|
BSE
Sensex
|
72,101.69
|
71,716.51
|
72,444.76
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata
Steel
|
775.50
|
145.40
|
142.61
|
149.41
|
State
Bank of India
|
254.05
|
736.60
|
724.61
|
743.76
|
HDFC
Bank
|
218.03
|
1432.00
|
1420.55
|
1447.55
|
ITC
|
196.09
|
416.00
|
411.49
|
418.59
|
ICICI
Bank
|
187.25
|
1087.00
|
1073.00
|
1095.50
|
- NTPC has planned to issue
unsecured NCDs of Rs 1,500 crore, through private placement at a coupon of
7.48% p.a. for a tenor of 2 years, maturing on March 21, 2026.
- TCS has been selected by Central
Bank to use TCS BaNCS to update its core technology infrastructure, drive
innovation, and strengthen customer relationships.
- UltraTech Cement has received
approval from Competition Commission of India to acquire Kesoram Cement
business from Kesoram Industries.
- Bharti Airtel has deployed additional sites in Kollam
district to densify its network.