Extending gains into the third
consecutive session, Indian equity benchmarks ended over half percent higher on
Monday amid improved global cues, following a tentative US debt ceiling deal
over the weekend. Markets after giving a gap-up opening traded in positive
territory throughout the session as traders took encouragement with World
Economic Forum (WEF) President Borge Brende's statement that India is expected
to clock the highest growth among the world's big economies this year and the
country's economy is witnessing the famous snowball effect that will lead to
more investments and more jobs. Some optimism also came as the commerce
ministry stated that members of the 14-nation bloc IPEF have substantially concluded
the negotiations on the supply chains agreement, including improving logistics
and connectivity; promoting investments in critical sectors and cooperation for
mitigation of disruptions to ensure business continuity. Traders took a note of
report that domestic rating agency Icra expects GDP growth in January-March
period of 2022-23 at 4.9 per cent, a modest step-up from the 4.4 per cent
recorded in preceding quarters, driven by the services sector. Sentiments
remained positive in afternoon deals, as Foreign Portfolio Investors (FPIs)
pumped Rs 37,316 crore in Indian equities in May so far, primarily due to
strong macroeconomic fundamentals and reasonable valuation of stocks. This is
the highest investment by FPIs in the last six months. Before this, they made a
net investment of Rs 36,239 crore in equities in November 2022. Further,
support also came as Union minister Ashwini Vaishnaw said India is all set to
become the fourth largest economy in world within two years. India is being
seen as a bright spot globally and the world is placing its confidence in
India, he said, urging people to continue posing their faith in the decisive
leadership that will take the nation to new highs by 2047. However, key indices
trimmed some of their initial gains in late afternoon deals as some concern
came with Chairman of the CII Committee on EXIM Sanjay Budhia's statement that
economic recession in Germany is likely to impact India's exports from various
sectors like chemicals, machinery, apparel and electronics to the European
nation. Traders also remained anxious as RBI said India's foreign exchange
reserves dropped by $6.052 billion to $593.477 billion during the week ended
May 19. Finally, the BSE Sensex surged 344.69 points or 0.55% to 62,846.38 and
the CNX Nifty was up by 99.30 points or 0.54% to 18,598.65.
The US markets remained closed on Monday on account of
Memorial Day.
The Indian rupee ended weaker
against the US dollar on Monday, tracking a strong American currency against
major rivals overseas. Sentiments were down beat even after Foreign Portfolio
Investors (FPIs) have pumped Rs 37,316 crore in Indian equities in May so far,
primarily due to strong macroeconomic fundamentals and reasonable valuation of
stocks. On the global front, dollar nudged lower on Monday, pulling back from
six-month peaks against the yen as a U.S. debt ceiling deal lifted risk
appetite across world markets and dented the greenback's safe-haven appeal.
U.S. President Joe Biden on Sunday finalised a budget agreement with House
Speaker Kevin McCarthy to suspend the $31.4 trillion debt ceiling until Jan. 1,
2025, and said the deal was ready to move to Congress for a vote. Finally, the
rupee ended at 82.64 (Provisional), weaker by 4 paise from its previous close
of 82.60 on Friday.
The FIIs as per Monday's data
were net buyers in both equity and debt segment. In equity segment, the gross
buying was of Rs 8530.83 crore against gross selling of Rs 6741.17 crore, while
in the debt segment, the gross purchase was of Rs 851.34 crore against gross
selling of Rs 441.46 crore. Besides, in the hybrid segment, the gross buying
was of Rs 4.88 crore against gross selling of Rs 42.86 crore.
The US markets remained closed on
Monday on account of Memorial Day. Asian markets are trading mixed on Tuesday
as the tentative US debt ceiling deal now faces a tussle between the
Republicans and Democrats before it gets passed through the Congress. Indian
markets ended Monday's session higher despite paring some early gains. Today,
markets are likely to make flat-to-positive start amid lack of triggers and
muted global sentiment. Foreign fund inflows likely to aid domestic sentiments.
Foreign institutional investors (FIIs) bought shares worth Rs 1758.16 crore on
May 29, provisional data from the National Stock Exchange showed. Traders will
be taking encouragement as the National Sample Survey Survey (NSSO) showed that
the unemployment rate for persons aged 15 years and above in urban areas
declined to 6.8 per cent during January-March 2023 from 8.2 per cent a year
ago. Joblessness or unemployment rate is defined as the percentage of
unemployed persons in the labour force. Joblessness was high in January-March
2022, mainly due to the staggering impact of Covid-related restrictions in the
country. Some support will come as a private said the RBI may cut key benchmark
policy rate in the fourth quarter of the current calendar year as a mix of
factors will allow the central bank to shift focus and adopt a more
accommodative policy stance sooner. Besides, a private report stated that India
has emerged as a key source country for Foreign Direct Investment (FDI) in
Dubai, one of the wealthiest of the seven emirates in the United Arab Emirates.
It ranked among the top five source countries for announced FDI projects and estimated
FDI capital. However, there may be some cautiousness as the Department for
Promotion of Industry and Internal Trade (DPIIT) data showed that foreign
direct investment (FDI) into India declined by 22 per cent to $46 billion in
2022-23, dragged by lower inflows in computer hardware and software, and
automobile industry. The FDI inflows stood at $58.77 billion during 2021-22.
Traders may take note of report that India is likely preparing for a
drought-like situation despite the forecast for a normal monsoon, due to risks
posed by El Nino. Banking stocks could be in focus today after RBI Governor
Shaktikanta Das pointed out lapses in the governance of some private banks.
There will be some reaction in metal industry stocks as research firm Crisil
Ratings said it expects the net debt-to-EBITDA ratio of domestic steel
manufacturers to stay below the level of 2 times in the financial year 2023-24.
The steel makers had reported the ratio of net debt to EBITDA in the range of
1.6-1.7 times in preceding financial year (FY) 2022-23.
Support
and Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
18,598.65
|
18,572.86
|
18,632.81
|
BSE
Sensex
|
62,846.38
|
62,756.62
|
62,981.08
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Oil
& Natural Gas Corporation
|
432.54
|
159.00
|
156.91
|
160.66
|
Tata
Steel
|
410.62
|
108.35
|
106.81
|
109.36
|
ITC
|
198.26
|
448.95
|
444.76
|
452.46
|
State
Bank of India
|
184.32
|
594.60
|
589.64
|
597.99
|
ICICI
Bank
|
121.08
|
948.15
|
944.10
|
954.90
|
ICICI Bank has received approval from board of directors to increase shareholding in ICICI Lombard General Insurance, in multiple tranches.
Sun Pharmaceutical Industries is planning to fully acquire Israel-based Taro Pharmaceutical Industries through a reverse triangular merger.
M&M has revised upward the capital expenditure outlay for the three years cycle of FY22-FY24 to Rs 15,900 crore from Rs 15,075 crore.
Reliance Industries' step down arm -- RCPL has partnered with General Mills entering into the fast-growing snacks segment as per its ambition into the FMCG segment.