Indian equity
benchmarks ended the volatile day of trade in red terrain on Friday with
frontline gauges settling below their crucial 47,900 (Sensex) and 14,350
(Nifty). Markets started the day on pessimistic note amid concerns over
continues rising coronavirus cases in the country. India reported 332,503 fresh
coronavirus infections on Friday, taking the cumulative caseload to 16,257,309,
Worldometer showed. Sentiments also
remain dampened after S&P Global Ratings said the Indian economy is
projected to grow at 11 per cent in the current fiscal, but flagged the
substantial impact of broader lockdowns on the economy. In its report on
Asia-Pacific Financial Institutions, S&P said the control of COVID-19
remains a key risk for the economy. New infections have spiked in recent weeks
and the country is in the middle of a second pandemic wave. Also, rating agency
Fitch Ratings has affirmed India's long-term foreign-currency Issuer Default
Rating (IDR) at BBB- with a negative outlook. Markets turned positive in noon
deals as traders opted to buy some beaten down but fundamentally strong stocks
after Finance Minister Nirmala Sitharaman said the industry is in recovery mode
and several Budget proposals are on course, including disinvestment, despite a
fresh wave of coronavirus infections and local lockdowns. Traders also took
some relief with Chief Economic Adviser K V Subramanian's statement that the
impact of the second wave of COVID-19 on the Indian economy may not be very
large. He also said predicting the second wave was a real problem for
researchers across the globe. However, the recovery proved short lives and
markets once again slipped in red terrain after credit rating agency, India
Ratings and Research (Ind-Ra) in its latest report has revised down India's
FY22 real GDP growth forecast to 10.1 per cent, from earlier projection of 10.4
per cent, citing the second wave of COVID-19 infections and slower pace of
vaccination. At a time when large parts of the country are experiencing
tremendous pressure on medical infrastructure, it expects the second wave to
start subsiding by mid-May. Finally, the BSE Sensex fell 202.22 points or 0.42%
to 47,878.45, while the CNX Nifty was down by 64.80 points or 0.45% to 14,341.35.
The US markets
ended higher on Friday supported by data indicating an acceleration in economic
activity and even faster growth in new home sales, as investors largely brushed
off Thursday's reports that President Joe Biden would propose a large increase
on the capital-gains tax for the wealthiest Americans. Optimism about the
economic recovery also helped prop up the markets, although concerns about high
valuations and surging coronavirus cases overseas have led to worries about the
near-term outlook. In US economic data, the IHS Markit purchasing managers
index for the manufacturing sector rose to a record 60.5 in April from 59.1 a
month earlier, while the services sector PMI jumped to 63.1 from 60.4. A
reading of more than 50 indicates an expansion in activity. Besides, the
Commerce Department released a report showing a substantial rebound in new home
sales in the month of March. The report showed new home sales skyrocketed by
20.7 percent to an annual rate of 1.021 million in March after plunging by 16.2
percent to a revised rate of 846,000 in February. Street had expected new home
sales to spike by 14.3 percent to a rate of 886,000 from the 775,000 originally
reported for the previous month. With the rebound, new home sales soared from
the eight-month low set in February to their highest level since August of
2006. Meanwhile, the Federal Reserve's monetary policy announcement is likely
to be in the spotlight next week, although the central bank is widely expected
to maintain its ultra-easy monetary policy.
Crude oil futures ended higher on
Friday with gains of over a percent amid buoyant demand for energy in the US.
Though, the massive surge in coronavirus infections in India, and the Japanese
government's decision to impose another lockdown in Tokyo and a few other
cities raised concerns about the outlook for energy demand. Meanwhile, data
from Baker Hughes showed the total weekly active drilling-rig count in the US
was down 1 at 438 this week. The data also showed active oil-rig count dropped
by 1 to 343 in the week. Crude oil futures for June rose 71 cents or 1.2
percent to settle at $62.14 barrel on the New York Mercantile Exchange. June
Brent crude gained 71 cents or 1.1 percent to settle at $66.11 a barrel on
London's Intercontinental Exchange.
Continuing previous session
drubbing, rupee ended lower against greenback on Friday. Sentiments were dented
as private report stated that the stringent mobility curbs and lockdowns put
across key Indian cities will dent the economic momentum and will result in an
economic loss of Rs 1.5 trillion. Total loss is estimated at Rs 1.5 trillion,
of which Maharashtra, Madhya Pradesh and Rajasthan account for 80 per cent.
Maharashtra alone accounts for 54 per cent. However, downfall remained capped
as Finance Minister Nirmala Sitharaman said the industry is in recovery mode
and several Budget proposals are on course, including disinvestment, despite a
fresh wave of coronavirus infections and local lockdowns. On the global front,
pound rebounded on Friday from a sharp fall on Thursday after strong retail
sales data which showed Britain's economy might already be recovering from its
worst annual contraction in 300 years. Finally, the rupee ended 75.01, weaker
by 7 paise from its previous close of 74.94 on Thursday.
The FIIs as per Friday's data
were net seller in both equity and debt segment. In equity segment, the gross
buying was of Rs 9597.46 crore against gross selling of Rs 10501.95 crore,
while in the debt segment, the gross purchase was of Rs 283.50 crore with gross
sales of Rs 845.62 crore. Besides, in the hybrid segment, the gross buying was
of Rs 13.82 crore against gross selling of Rs 12.43 crore.
The US markets ended higher on
Friday as increased factory output and housing data supported expectations of a
swift economic recovery, while big tech stocks rose in anticipation of strong
earnings reports. Asian markets are trading mostly in green on Monday as signs
the world economic recovery was well on track bolstered risk appetite, while
the US dollar slipped to a two-month low. Indian markets ended lower Friday
dragged by selling in IT, FMCG and pharma stocks. Today, the start of the
F&O series expiry week is likely to be positive tracking firm global cues.
Some support will come with Union Minister Nitin Gadkari's statement that the
pandemic has caused a slowdown in India but the country's inherent resilience
and capability will help it transform into a new India with a faster growth
path fuelled by infrastructure. However, rising coronavirus cases may cap gains
in markets. India reported 354,531 fresh coronavirus infections, taking the
cumulative caseload to 17,306,300, Worldometer showed. There may be some
cautiousness with report that overseas investors withdrew a net Rs 7,622 crore
from Indian markets in April so far as a surge in COVID-19 cases and the
consequent restrictions imposed by various states dent investors' sentiment.
Traders may take note of 15th Finance Commission Chairman NK Singh's statement
that India's tax revenue potential is lower by 4 per cent of GDP and the
country needs to bring in deep reforms in the revenue management system. He
also said an incentive mechanism for states needs to be worked out so that
their policies are aligned to those of the central government. Meanwhile, the
centre has allowed state governments to borrow 75% of their annual market
borrowing limit of 4% of their respective Gross State Domestic Product (GSDP)
in the first nine months of the current fiscal year. The move comes during a
time where there are revenue constraints on state governments and the
coronavirus delays recovery. Auto stocks will be in focus as India Ratings and
Research (Ind-Ra) in its latest report stated that the second wave of
COVID-19could pose downside risks to the domestic auto industry demand in the
near term. It said the demand for commercial vehicles (CVs) may revive in the
second quarter of 2021-22 as economic activities improve, and also due to the
lower capacity in the system after consecutive double-digit decline in 2019-20
and 2020-21. There will be some reaction in oil & gas sector stocks as oil
marketing companies keep fuel prices unchanged for tenth straight day. Petrol
and diesel prices were unchanged across the four metros for the 10th day in a
row. There will be lots of important earnings announcements too, to keep the
markets in action.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
14,341.35
|
14,256.05
|
14,443.90
|
BSE
Sensex
|
47,878.45
|
47,610.21
|
48,206.05
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata
Motors
|
581.58
|
294.00
|
289.66
|
299.16
|
State
Bank of India
|
442.23
|
336.45
|
332.10
|
340.35
|
ICICI
Bank
|
337.49
|
569.95
|
564.50
|
577.95
|
NTPC
|
294.84
|
102.55
|
99.36
|
104.36
|
Tata
Steel
|
247.52
|
925.60
|
909.24
|
943.49
|
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