Indian equity benchmarks snapped
a two-day winning streak and ended over a percent lower on Friday, dragged by
losses across most sectors, especially Energy, Banking and FMCG shares amid
uncertainty surrounding the Omicron variant. Markets started trade on a
positive note, as traders took some support with the Centre for Monitoring
Indian Economy's statement that the index of consumer sentiment for rural India
inched up by 0.3% for the week ended November 28 while the index for consumer
expectation went up by 1.3%, a much lower jump compared to weeks before the
announcement of the repeal of farm laws. Some solace also came after a private
survey showed activity in India's dominant services sector continued to grow at
a robust pace in November 2021 supported by a strong recovery in domestic
demand, but elevated price pressures remained a major concern. The Services
Purchasing Managers' Index, compiled by IHS Markit, eased to 58.1 in November
from 58.4 in October, but November's rate of growth was the second-best in over
a decade and well above the 50-mark separating growth from contraction for a
fourth straight month. However, frontline indices quickly reversed their gains
and slipped into red terrain in afternoon deals, as traders turned cautious
with private report increased its current account deficit (CAD) forecast to 1.9
per cent of GDP at $60 billion for 2021-22 as compared to $45 billion earlier,
following the record $23.27 billion trade deficit in November. It said trade
deficit -- the difference between a country's imports and exports -- has been
rising and remains sticky, driven by weaker exports, surging domestic activity
and higher commodity prices. Sentiments also remained dampened after a private
report highlighted a curious case of increase in aggregate bank deposits
followed by subsequent slump in alternate fortnights, which is quite a
contrarian trend. As per the provisional data released by RBI for the fortnight
ended 19 November 2021, all scheduled commercial banks' (ASCB) aggregate
deposits have slumped by Rs 2.7 lakh crore during the fortnight. This slump in
deposits follows an abrupt increase by Rs 3.3 lakh crore during the previous
fortnight ended 5 November 2021. Finally, the BSE Sensex fell 764.83 points or
1.31% to 57,696.46 and the CNX Nifty was down by 204.95 points or 1.18% to
17,196.70.
The US markets moved back to the
downside during trading on Friday following the rally seen in the previous
session. The tech-heavy Nasdaq showed a particularly steep drop, tumbling to
its lowest closing level in well over a month. The fall on Wall Street came
amid latest news about the Omicron variant of the coronavirus. After the first
confirmed omicron case in the U.S. earlier in the week, the new variant has now
been detected in at least five states. Traders were also reacting to a closely
watched report from the Labor Department showing much weaker than expected U.S.
job growth in the month of November. The report said non-farm payroll
employment rose by 210,000 jobs in November after surging by an upwardly
revised 546,000 jobs in October. Street had expected employment to spike by
550,000 jobs compared to the jump of 531,000 jobs originally reported for the
previous month. Despite the much weaker than expected job growth, the
unemployment rate slid to 4.2 percent in November from 4.6 percent in October.
Street had expected the unemployment rate to edge down to 4.5 percent. With the
much bigger than expected decrease, the unemployment rate fell to its lowest
level since hitting 3.5 percent in February of 2020. Meanwhile, a separate
report from the Institute for Supply Management showed an unexpected
acceleration in the pace of growth in U.S. service sector activity in the month
of November. The ISM said its services PMI rose to a record high 69.1 in
November from 66.7 in October, with a reading above 50 indicating growth in the
sector. The increase surprised street, who had expected the index to dip to
65.0.
Crude oil futures pared early
gains and settled lower on Friday amid uncertainty about the outlook for energy
demand due to fresh restrictions on movements following the spread of the new
coronavirus variant Omicron in several countries. Oil prices climbed earlier in
the day, riding on the decision of OPEC+ to stick to their existing policy of
monthly oil output increases but left room for quick adjustments if the Omicron
variant hits demand. Meanwhile, a report from Baker Hughes said the total count
of active drilling rigs in the U.S. held steady at 569, the same as last week.
Rigs targeting crude oil and natural gas remained unchanged at 467 and 102,
respectively. Benchmark crude oil futures for January delivery fell 24 cents,
or 0.4 percent to settle at $66.26 a barrel on the New York Mercantile
Exchange. Brent crude for February delivery rose 21 cents or 0.3percent to settle
at $69.88 a barrel on London's Intercontinental Exchange.
Indian rupee ended weaker against
dollar on Friday with fresh dollar demand by banks and importers. Sentiments
were dented with private report stating that increasing current account deficit
(CAD) forecast to 1.9 per cent of GDP at $60 billion for 2021-22 as compared to
$45 billion earlier, following the record $23.27 billion trade deficit in
November. It said trade deficit -- the difference between a country's imports
and exports -- has been rising and remains sticky, driven by weaker exports,
surging domestic activity and higher commodity prices. On the global front,
dollar gained on Friday against most major currencies as traders positioned
ahead of key U.S. jobs data that could clear the path for an earlier rate hike
by the Federal Reserve. Finally, the rupee ended 75.12 (Provisional), weaker by
10 paise from its previous close of 75.02 on Thursday.
The FIIs as per Friday's data
were net sellers in equity, while net buyers in debt segment. In equity
segment, the gross buying was of Rs 9499.31 crore against gross selling of Rs
9800.84 crore, while in the debt segment, the gross purchase was of Rs 1663.15
crore with gross sales of Rs 993.86 crore. Besides, in the hybrid segment, the
gross buying was of Rs 4.04 crore against gross selling of Rs 7.49 crore.
The US markets ended lower on
Friday with the Nasdaq leading the declines as investors bet that a strong jobs
report would not slow the Federal Reserve's withdrawal of support while they
grappled with uncertainty around the Omicron coronavirus variant. Asian markets
are trading mixed on Monday as investors remained cautious about the
repercussions of the emergence of the Omicron variant of COVID-19. Indian
markets snapped a two-day winning run on Friday amid selling pressure in financial,
oil & gas and consumer shares. Today, the start of session is likely to be
cautious on report of fresh Omicron-based Covid-19 cases emerge in India amid
weakness in global markets. Market participants will keep a close eye on the
Reserve Bank of India's Monetary Policy Committee (MPC) which will begin its
three-day bi-monthly deliberations today. Amid global scare due to new
coronavirus variant Omicron, the RBI is likely to maintain status quo in its
upcoming monetary policy and wait for a more opportune time to calibrate
benchmark interest rate to promote growth without sacrificing the main
objective of containing inflation. Some cautiousness will come amid reports
about continues foreign fund outflow. The exchange data showed that foreign
portfolio investors (FPIs) remained net sellers for Rs 3356.17 crore in the
Indian markets. Besides, RBI data showed the country's foreign exchange
reserves declined by $2.713 billion to $637.687 billion in the week to November
26. However, some support may come later in the day as Home Minister Amit Shah
said the Indian economy is the fastest in the world to come out of the impact
of the coronavirus pandemic because of policy decisions taken by the Modi
government. Additionally, Defence Minister Rajnath Singh said India has
exported defence items worth more than Rs 38,000 crore in the past seven years
and the country hopes to become an overall net exporter soon. Traders may take
note of report that Union Finance Minister Nirmala Sitharaman said that the
government will bring a well consulted cryptocurrency Bill. There will be some
buzz in the agriculture industry stocks with the commerce ministry's statement
that India's exports of agricultural and processed food products rose by more
than 13 per cent during April-November this fiscal to $23.26 billion. Metal
stocks will be in focus as ratings agency Crisil said Freight rates for mining,
cement, and steel have seen some corrections on-month in November as
infrastructure-building activities were subdued. There will be some reaction in
NBFCs stocks as India Ratings and Research (Ind-Ra) said tightening of norms
may increase non-banking finance companies' (NBFCs) headline non-performing
advances (NPA) by around one third. Anand Rathi Wealth IPO will close for
subscription today. So far the public issue has been bid for 3.02 times by
investors with all retail and Non-institutional Investors oversubscribing their
portion of the IPO. Investors will have two more IPOs to invest in this week as
Rategain Travel Technologies and Shriram Properties will open for subscription.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE Nifty
|
17,196.70
|
17,088.40
|
17,397.40
|
BSE Sensex
|
57,696.46
|
57,305.65
|
58,422.17
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Power
Grid Corporation of India
|
357.10
|
205.80
|
202.05
|
213.00
|
Tata
Motors
|
209.48
|
480.30
|
476.84
|
484.24
|
Coal
India
|
204.14
|
159.85
|
158.50
|
160.95
|
ICICI
Bank
|
201.30
|
717.15
|
711.66
|
726.06
|
State
Bank of India
|
166.53
|
471.95
|
467.50
|
478.95
|
APSEZ has reported cargo volume of 24.74 MMT for November 2021 as compared to 23.77 MMT for the same period last year, registering a growth of 4.08%.
Hero MotoCorp along with Gilera Motors Argentina has expanded operations and inaugurated a flagship dealership in Argentina.
L&T and Kemroc have entered into a distribution agreement that will facilitate Kemroc products to be distributed and promoted in the Indian market by L&T.
ONGC has signed a MoU with Solar Energy Corporation of India to scale up its clean energy projects.