Indian equity
benchmarks wiped off morning gains to end flat on Monday, as investors awaited
data on consumer price inflation (CPI) for June and industrial output for May.
The benchmarks staged a gap up opening taking cues from positive global cues.
Traders took encouragement with report stated that despite the worse condition
due to COVID-19 which impacted economic growth, the net direct tax collection
has doubled to over Rs 2.49 lakh crore so far this fiscal, mainly driven by
personal income tax and advance tax mop up. Sentiments remained positive as the
Confederation of Indian Industry (CII) in its latest survey report stated that
India's economy is expected to see a swift recovery from the impact of the
second wave of COVID-19 as lockdowns were largely designed to limit social
gatherings and did not affect economic activities much. Some support also came
as the Department of Economic Affairs (DEA) under the Ministry of Finance
stated that the Indian economy is showing signs of revival from the second wave
of the COVID-19 pandemic. It further added that healthy monsoon coverage,
gradually rising Kharif sowing and unlocking of states are expected to ease
inflation. However, benchmarks erased their gains and turned negative in late
afternoon session amid reports that India's Covid caseload is on a downhill,
but concerns over the Delta and Delta plus variants persist across the globe.
Meanwhile, India has recorded 37,676 fresh cases taking the total caseload to
30,873,907, according to Worldometer. Finally, the BSE Sensex fell 13.50 points
or 0.03% to 52,372.69, while the CNX Nifty was up by 2.80 points or 0.02% to
15,692.60.
The US markets ended higher on
Monday as investors grew more optimistic ahead of second-quarter earnings
reporting season set to kick off this week. JPMorgan Chase and Goldman Sachs
will be among the first big companies to report Tuesday. The modestly higher
close on markets reflected recent upward momentum, which has helped propel
stocks to record highs despite uncertainty about the global economic outlook.
Investors also anticipate important data to be released this week, including
key readings on inflation on Tuesday and Wednesday, and June retail sales on
Friday. Federal Reserve chair Jerome
Powell is set to testify before Congress on Wednesday and Thursday, and
investors will be looking for any signals of fiscal policy updates. On the
sectoral front, semiconductor stocks showed a strong move to the upside on the
day, driving the Philadelphia Semiconductor Index up by 1.2 percent. Notable
strength was also visible among financial stocks, with the KBW Bank Index and
the NYSE Arca Broker/Dealer Index rising by 1.2 percent and 1.1 percent,
respectively. On the other hand, gold, networking and biotechnology stocks
moved notably lower on the day, limiting the upside for the broader markets.
Crude oil futures ended lower on
Monday amid concerns about outlook for energy demand due to the surge in the
delta variant of the coronavirus and possible fresh travel restrictions in
several places. Investors also fear that the lack of a new supply agreement
among the OPEC and its allies could prompt major oil producers to significantly
step up production much faster. Besides, finance ministers from the Group of 20
countries warned over the weekend that the global economic growth is at risk
from the spike of new coronavirus variants and the low vaccine availability in
developing countries. Crude oil futures for August fell $0.46 or 0.6 percent to
settle at $74.10 barrel on the New York Mercantile Exchange. September Brent
crude lost $0.27 or 0.36 percent to settle at $75.28 a barrel on London's
Intercontinental Exchange.
Indian rupee ended stronger
against dollar on Monday due to fresh selling of the American currency by banks
and exporters. Traders took solace with CII's latest survey report stated that
India's economy is expected to see a swift recovery from the impact of the
second wave of COVID-19 as lockdowns were largely designed to limit social
gatherings and did not affect economic activities much. However, upside remain
capped as foreign portfolio investors (FPIs) pulled out Rs 2,249 crore from the
Indian equities segment in the first seven trading sessions of July. On the
global front; sterling nudged lower on Monday as British Prime Minister Boris
Johnson is expected to confirm plans to remove nearly all remaining COVID-19
restrictions in England from July 19, despite a surge of cases to levels unseen
for months. Finally, the rupee ended 74.58, stronger by 5 paise from its
previous close of 74.64 on Friday.
The FIIs as per Monday's data
were net seller in equity segment, while net buyer in debt segment. In equity
segment, the gross buying was of Rs 3968.81 crore against gross selling of Rs
4972.32 crore, while in the debt segment, the gross purchase was of Rs 588.49
crore with gross sales of Rs 507.77 crore. Besides, in the hybrid segment, the
gross buying was of Rs 17.61 crore against gross selling of Rs 16.77 crore.
The US markets ended higher on
Monday as investors awaited the start of the second-quarter earnings season and
a batch of economic data to gauge the next leg of the equity market. Asian
markets are trading mostly in green on Tuesday as investors awaited the release
of China's trade data for June. Indian markets pared morning gains and ended
flat on Monday as losses in IT and metals offset gains in banks and auto
stocks. Today, the markets are likely to make gap-up opening tracking firm
global cues. Traders will be taking encouragement as data released by the
government showed that India's industrial production grew 29.3 per cent in May
over the same period a year ago, as the impact of a favourable base continued
for yet another month. Also, India's retail inflation eased slightly to 6.26
per cent in June, but stayed above the Reserve Bank's tolerance range (2 per
cent-6 per cent) for the second straight month. Some support will come with a
private report that the Indian economy is at the start of a virtuous cycle and
on the path to becoming a $15 trillion economy over the next two decades.
Traders may take note of another private report that even though the second
wave of the pandemic and subsequent lockdowns affected the economic growth, the
overall job postings have improved sequentially four per cent across various
sectors. Meanwhile, India has recorded 30,827 fresh cases taking the total
caseload to 30,904,734, according to Worldometer. The death count increased to
409,338 with 546 new fatalities, the data showed. There will be some buzz in
the telecom stocks as latest TRAI data showed that Reliance Jio added 4.7
million users in April and its subscriber base swelled to 427.6 million.
Vodafone Idea lost 1.8 million users and its subscriber base shrunk to 281.9
million in April, while Bharti Airtel added 0.51 million wireless customers and
its user base rose marginally to 352.9 million. Media and entertainment (ME)
industry stocks will be in focus with a private report that the country's ME
sector will be the fastest growing globally in terms of both consumer and
advertising spends, and will be an over-Rs 4-lakh-crore industry by 2025. There
will be some reaction in NBFCs stocks with Crisil's report that Non-banking
finance companies (NBFCs) are better placed currently on the liquidity front
than they were a year ago, enabling them to service their near debt without
much difficulty, despite a fall in collections because of the second wave of
Covid-19. There will be some result announcements to keep the markets in
action.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
15,692.60
|
15,628.50
|
15,772.95
|
BSE
Sensex
|
52,372.69
|
52,154.27
|
52,645.82
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
Tata Motors
|
322.82
|
307.45
|
305.04
|
310.94
|
Tata Steel
|
166.47
|
1226.95
|
1,210.70
|
1,250.85
|
ITC
|
130.85
|
201.10
|
200.51
|
202.11
|
State Bank of India
|
128.86
|
427.45
|
424.61
|
430.26
|
JSW Steel
|
116.32
|
694.45
|
682.29
|
705.19
|
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