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NSE Intra-day chart (12 November 2021)
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Market Commentary 15 November 2021
Benchmarks to start new week on positive note

 

Indian equity benchmarks snapped 3-day losing streak with strong gains on Friday, tracking positive global cues. Gains in TECK, IT and Telecom stocks pushed the headline indices higher. Equity markets made a gap-up start, as sentiments got a boost with Niti Aayog Vice-Chairman Rajiv Kumar's statement that Indian economy is expected to grow by more than 10 per cent in the current fiscal supported by a record kharif crop and bright rabi prospects. According to Kumar, significant increase in exports will also boost economic growth and employment generation. However, benchmarks erased some initial gains in morning deals, as some cautiousness came with a private report that India's widening current account deficit (CAD), driven by the massive spike in commodity prices led by crude oil, is set to put pressure on the fragile recovery. Traders also remained on sidelines ahead of the macro economic data -- industrial production and inflation data -- scheduled to be announced later in the day. Key gauges resumed their uptrend and were back near the day's high trajectory in afternoon deals, as buying spread across the sectors. Some optimism also came with Union Minister of State for Finance Bhagwat Karad's statement that buoyancy in Goods and Services Tax (GST) collection in October shows the Indian economy, adversely affected by the coronavirus pandemic, is on the path to swift recovery. Indicating the impact of festive buying, GST collection remained above Rs 1 lakh crore for the fourth month in a row at over Rs 1.30 lakh crore in October. Domestic sentiments were positive after Reserve Bank of India Governor Shaktikanta Das said that RBI Retail Direct Scheme and Reserve Bank Integrated Ombudsman Scheme will provide further impetus to India's journey towards a more inclusive and responsive financial system. Traders took note of report that Commerce and Industry Minister Piyush Goyal said India is looking at reciprocal and equitable access to foreign markets through free trade agreements, which the country is negotiating with its trading partners. Finally, the BSE Sensex rose 767.00 points or 1.28% to 60,686.69 and the CNX Nifty was up by 229.15 points or 1.28% to 18,102.75.

 

The US markets closed in green on Friday with notable gains as the concerns about inflation raised by the Labor Department's consumer price report seem to have been short-lived. While the report showed consumer prices rose at their fastest annual rate in over thirty years in October, market participants have suggested the current wave of price spikes due to chronic worldwide supply constraints will not last long. Federal Reserve officials have also repeatedly described the factors driving inflation as transitory, indicating the central bank is not currently considering accelerating monetary policy tightening. After ending Thursday's trading lower amid a steep drop by Disney (DIS), the Dow benefitted from an advance by shares of Johnson & Johnson (JNJ). JNJ rose by 1.2 percent after the healthcare giant announced plans to separate its consumer health business from its pharmaceutical and medical device operations. Meanwhile, traders largely shrugged off report from the University of Michigan showing an unexpected deterioration in U.S. consumer sentiment in the month of November. The preliminary report said the consumer sentiment index slid to 66.8 in November from a final reading of 71.7 in October. The decrease surprised participants, who had expected the index to inch up to 72.4. With the unexpected drop, the consumer sentiment index fell to its lowest level since hitting 63.7 in November of 2011. On the sector front, tobacco stocks showed a substantial move to the upside on the day, driving the NYSE Arca Tobacco Index up by 2.4 percent. Significant strength was also visible among housing stocks, as reflected by the 1.5 percent gain posted by the Philadelphia Housing Sector Index. Software stocks also turned in a strong performance, resulting in a 1.5 percent advance by the Dow Jones U.S. Software Index. Retail and networking stocks also saw considerable strength, while oil service stocks moved lower along with the price of crude oil.

 

Crude oil futures ended significantly lower on Friday weighed down by a firm dollar and a downward revision in global oil demand forecast by the OPEC. Traders also weighed a likely release of oil from the Strategic Petroleum Reserve (SPR). U.S. President Joe Biden is reportedly weighing moves to release oil from SPR to cool energy prices. Meanwhile, a report released by Baker Hughes this afternoon said the oil and gas rig count in the U.S. rose six to 556 in the week to November 12, the highest level since April 2020. The total rig count has increased by 244 rigs or about 0.78% over this time last year. The data showed oil rigs were up by 4 to 454 this week, gas rigs rose two to 102. Benchmark crude oil futures for December delivery fell 80 cents or 1 percent to settle at $ 80.79 a barrel on the New York Mercantile Exchange. Brent crude for January delivery lost 70 cents or 0.8 percent to settle at $82.17 a barrel on London's Intercontinental Exchange.

 

Indian rupee ended marginally higher on Friday, owing to dollar sale by exporters and banks. Traders took some support with Niti Aayog Vice-Chairman Rajiv Kumar said Indian economy is expected to grow by more than 10 per cent in the current fiscal supported by a record kharif crop and bright rabi prospects. Besides, a firm trend in domestic equities and lower crude prices in the international market also supported the local unit. However, gains remain capped as some concern came with a private report that India's widening current account deficit (CAD), driven by the massive spike in commodity prices led by crude oil, is set to put pressure on the fragile recovery. On the global front, the dollar climbed on Friday since a surprisingly strong U.S. inflation print shocked markets and prompted investors to advance their bets on a U.S rate hike to as early as mid-2022. Finally, the rupee ended 74.43 (provisional), stronger by 9 paise from its previous close of 74.52 on Thursday.

 

The FIIs as per Friday's data were net buyers in equity segment, while net sellers in debt segment. In equity segment, the gross buying was of Rs 12484.17 crore against gross selling of Rs 8720.55 crore, while in the debt segment, the gross purchase was of Rs 279.82 crore with gross sales of Rs 421.12 crore. Besides, in the hybrid segment, the gross buying was of Rs 11.11 crore against gross selling of Rs 13.22 crore.

 

The US markets ended higher on Friday with market-leading growth shares kick-starting indexes' climb as investors looked past disappointing U.S. economic data. Asian markets are trading mixed on Monday as US stock futures gained, though investors were cautious ahead of a batch of Chinese economic data due later in the day. Indian markets snapped three-day losing streak on Friday and ended higher with gains of around 1.3 percent each. Gains across sectors, led by IT, financial and oil & gas shares, lifted the headline indices. Today, the start of new week is likely to be positive tracking gains in global markets. Investors will be eyeing WPI data to be out later in the day for further direction. Traders will be taking encouragement with outgoing chief economic advisor K V Subramanian's statement that Indian economy is expected to see a double-digit growth in 2021-22 and between 6.5-7 per cent in the next financial year. The CEA said that he does not expect commodity inflation will taper the V-shaped recovery going forward. Some support will come as Commerce and Industry Minister Piyush Goyal said Indian economy is back in action and it is clear from several indicators such as rising exports and increasing foreign direct investment (FDI) inflows into the country. Also, World Economic Forum President Borge Brende said he expected India to hit a double-digit growth next year while it celebrates its 75 years of independence and prepares for its G20 presidency. However, weak macro-economic data may weight on the markets. Traders may be concerned as Industrial production growth slipped to 3.1 per cent in September, mainly due to the waning low base effect while mining and manufacturing sectors performed well. Additionally, Retail inflation after remaining on downtrend for four months moved a tad up in October to 4.48 per cent due to an uptick in food prices and higher cost of motor fuel. There will be some cautiousness as foreign portfolio investors (FPIs) were net sellers in the Indian markets to the tune of Rs 949 crore in the first half of November. As per the depositories data, they pulled out Rs 4,694 crore from equities between November 1-12. Besides, the Reserve Bank said India's forex reserves decreased by $1.145 billion to $640.874 billion for the week ended on November 5 on a fall in currency and gold assets. Coal industry stocks will be in focus with a private report showing that India's coal import rose by 12.6 per cent to 107.34 million tonnes in the first six months of 2021-22. The country had imported 95.30 million tonnes (MT) of the coal in April-September 2020-21. Meanwhile, Equity shares of three companies - Policybazaar & Paisabazaar operator PB Fintech, Sigachi Industries and SJS Enterprises will make their stock market debut on the bourses today, November 15, 2021.

 

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

 

Index

Previous close

Support

Resistance

NSE Nifty

18,102.75

17,964.76

18,181.86

BSE Sensex

60,686.69

60,206.20

60,958.96

 

Nifty Top volumes

 

Stock

Volume

Previous close (Rs)

Support  (Rs)

Resistance (Rs)

(in Lacs)

Tata Steel

232.39

1286.70

1,258.54

1,327.44

Tata Motors

207.31

507.35

499.95

512.15

State Bank of India

198.36

510.95

504.76

515.06

Hindalco Industries

170.10

468.10

461.20

472.75

ICICI Bank

153.80

777.60

772.56

781.26

 

  • Sun Pharmaceutical Industries is gearing up to introduce Merck Sharpe Dohme and Ridgeback's molnupiravir under the brand name Molxvir in India. 
  • Wipro has unveiled Click-Shift-Drive, a contactless car-buying solution that addresses the complete automobile-buying journey. 
  • TCS has expanded its long-standing strategic partnership with Woolworths Group to provide IT and digital services. 
  • Hindalco Industries has reported around 9-fold jump in its consolidated net profit at Rs 3417 crore for Q2FY22 as compared to Rs 387 crore for Q2FY21.
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