Indian equity benchmarks were
positive for second consecutive day and ended Tuesday's session with gains of
around two percent, led by a strong rebound across all sectors amid positive
cues from the global markets. Domestic indices opened gap up and continued to
gain strength throughout the day, as traders took support with the southwest
monsoon entering Madhya Pradesh, Chhattisgarh, coastal Andhra Pradesh, Odisha,
west Bengal, Jharkhand and Bihar on Monday, cumulative rainfall deficiency so
far has been reduced to 5% from 25% reported on June 16. The India
Meteorological Department (IMD) has predicted an intense spell of rainfall
along the west coast in the next five days. Some support also came as
retirement fund body EPFO has added 17.08 lakh net new subscribers in April
2022, nearly 34 per cent more than 12.76 lakh enrolled in the same month a year
ago. Local equity markets enlarged their gains in the late afternoon session,
taking support from the commerce and industry minister Piyush Goyal's statement
that the proposed free trade agreement with the European Union, when
implemented, will provide greater market access for several domestic sectors
such as textiles, leather and sports goods in the EU market. Traders overlooked
labour bureau's statement that retail inflation for farm and rural labourers
increased to 6.67 per cent and 7 per cent, respectively in May, mainly due to
higher prices of certain food items. Meanwhile, the pension Fund Regulatory and
Development Authority (PFRDA) data showed that the number of subscribers in
various schemes of the National Pension System (NPS) rose to 53.17 million in
May 2022, registering a 24.07 per cent YoY growth. Till May 2021, the NPS
subscribers numbers stood at 42.85 million. Finally, the BSE Sensex rose 934.23
points or 1.81% to 52,532.07 and the CNX Nifty was up by 288.65 points or 1.88%
to 15,638.80.
The US markets settled higher on
Tuesday as traders picked up stocks at relatively reduced levels following
recent weakness in the markets. Those moves followed last week's declines in
which the S&P 500 posted its worst week since 2020. Many investors fear
that a rebound amid growing fears of a recession may be short-lived, though
others expect that equities may be oversold after more accurately pricing in
inflationary pressures. On the sectoral front, Energy stocks turned in some of
the best performances on the day, benefiting from a rebound by the price of
crude oil. Crude for August delivery jumped $1.53 or 1.4 percent to $109.52 a
barrel after plummeting $7.26 or 6.3 percent to $107.99 a barrel last Friday.
Reflecting the strength in the energy sector, the NYSE Arca Oil Index soared by
5 percent, the Philadelphia Oil Service Index surged by 4.8 percent, and the
NYSE Arca Natural Gas Index shot up by 3.5 percent. Telecom stocks also saw
substantial strength, resulting in a 3.2 percent jump by the NYSE Arca North
American Telecom Index. Among individual stocks, shares of Valneva skyrocketed
after drug giant Pfizer (PFE) agreed to acquire an 8.1 percent stake in the
French vaccine maker for $95 million. Shares of Spirit Airlines also soared
after JetBlue increased its takeover offer for the discount airline to $33.50
per share. On the economic data front, the National Association of Realtors
showing another steep drop in US existing home sales in the month of May. NAR
said existing home sales plunged by 3.4 percent to an annual rate of 5.41
million in May after slumping by 2.6 percent to a revised rate of 5.60 million in
April. Street had expected existing home sales to tumble by 3.7 percent to a
rate of 5.40 million from the 5.61 million originally reported for the previous
month.
Crude oil futures ended higher on
Tuesday on account of lingering concerns about global supplies. The market has
been supported by supply anxiety after sanctions on oil shipments from Russia,
the world's second-largest oil exporter, and worries Russian output could fall
due to sanctions on equipment needed for production. Meanwhile, US President
Joe Biden said on Monday a decision on whether to pause a federal gasoline tax
could come this week. The United States is also in talks with Canada and other
allies to further restrict Moscow's energy revenue by imposing a price cap on
Russian oil. Benchmark crude oil futures for August delivery surged $1.53 or
1.4 percent to settle at $109.52 a barrel on the New York Mercantile Exchange.
Brent crude for August delivery rose $0.52 or 0.5 percent to settle at $114.65
a barrel on London's Intercontinental Exchange.
Indian rupee ended weaker against
the US dollar on Tuesday amid persistent foreign fund outflows and a jump in
crude oil prices weighed on investor sentiment. Traders were also worried as
retail inflation for farm and rural labourers increased to 6.67 per cent and 7
per cent, respectively in May, mainly due to higher prices of certain food
items. Meanwhile, Piyush Goyal states that the proposed free trade agreement
with the European Union, when implemented, will provide greater market access
for several domestic sectors such as textiles, leather and sports goods in the
EU market. On the global front, euro rose on Tuesday, drawing support from the
European Central Bank's plans to raise interest rates to contain inflation,
while the yen slumped to a 24-year low as the Bank of Japan's ultra-loose
monetary policy stance continued to weigh. Finally, the rupee ended at 78.10
(provisional), weaker by 12 paise from its previous close of 77.98 on Monday.
The FIIs as per Tuesday's data were
net buyers in equity segment, while net sellers in debt segment. In equity
segment, the gross buying was of Rs 5567.07 crore against gross selling of Rs
5225.25 crore, while in the debt segment, the gross purchase was of Rs 75.22
crore against gross selling of Rs 504.14 crore. Besides, in the hybrid segment,
the gross buying was of Rs 2.56 crore against gross selling of Rs 13.21 crore.
The US markets ended sharply
higher on Tuesday as investors picked up stocks after markets moved into an
oversold zone. Asian markets are trading mostly in red on Wednesday as investors
remain nervous about aggressive hikes in interest rates and the prospect of
slowing growth. Indian markets ended higher with notable gains on Tuesday
backed by broad-based buying, rising for a second straight day following a
six-day sell-off that took away seven percent of their value. Today, markets
are likely to get flat-to-negative start amid rise in crude oil prices and
tracking weakness across other Asian markets despite a strong session on Wall
Street overnight. Continued foreign fund outflows likely to dampen sentiments
in domestic markets. Foreign institutional investors (FIIs) sold shares worth
Rs 2,701 crore on June 21. FIIs have so far this year sold shares worth Rs
2,07,195 crore, data from NSDL showed. There will be some cautiousness with RBI
data showing that operating profit growth of listed private companies
decelerated across broad sectors in the January-March quarter of 2021-22, on
the back of rise in expenditure. Operating profit of manufacturing companies
decelerated sharply to 7 per cent in the fourth quarter of last fiscal as
against 70 per cent in the corresponding quarter of the preceding fiscal.
However, some support may come later in the day as Union minister Piyush Goyal
has expressed hope that the free trade agreement between India and the United
Kingdom will be concluded by Diwali. The minister for commerce and industry and
textiles said that the government is moving ahead on free trade pacts with
Canada, European Union and the UK. Besides, capital markets regulator Sebi has
permitted mutual funds to again invest in foreign stocks within the aggregate
mandated limit of $7 billion for the industry. This came in the wake of a major
correction in global markets that brought down the valuation of international
stocks. There will be some buzz in the construction companies stocks as ICRA
said the domestic metro rail projects will provide business opportunities worth
Rs 80,000 crore for construction companies over the next five years.
Infrastructure industry stocks will be in focus as the Department of Economic
Affairs (DEA), under the finance ministry, in collaboration with the Capacity
Building Commission (CBC) has framed a Capacity Enhancement Plan (CEP) for
driving relevant capacities across ministries, state governments and the extended
ecosystem of infrastructure execution in the country. There will be some
reaction in Telecom stocks as industry body Broadband India Forum termed
telcos' arguments on a level playing field between public and captive private
5G networks as absurd and impractical, and asserted that the two are separate
sets of services on a completely different footing and not competing with each
other.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
15,638.80
|
15,470.01
|
15,757.41
|
BSE
Sensex
|
52,532.07
|
51,960.76
|
52,951.40
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
NTPC
|
513.98
|
140.00
|
138.09
|
141.59
|
Oil and Natural Gas Corporation
|
205.81
|
139.40
|
136.20
|
141.40
|
Hindalco Industries
|
152.08
|
340.75
|
329.74
|
347.64
|
Tata Motors
|
147.43
|
398.10
|
390.40
|
402.40
|
ITC
|
138.83
|
269.60
|
265.51
|
272.26
|
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Hero MotoCorp has further strengthened its commitment and operations in Turkiye with the introduction of Euro-5 compliant variants of its three globally popular products.
Bajaj Finance has partnered with Worldline, a global leader in payment services, to develop point-of-sales payments acquiring solutions for its merchant network.