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NSE Intra-day chart (27 May 2024)
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Market Commentary 28 May 2024
Markets to get flat-to-positive start tracking gains in Asian counterparts

Indian equity benchmarks ended flat with a negative bias on Monday as investors started booking profit at higher levels to avoid any knee jerk reaction in the market ahead of the results of the Lok Sabha polls announcement. Markets opened on positive note and extended the gains as the day progress, as traders took some support with the latest data published by the Reserve Bank of India showing that India's forex reserves surged by $4.54 billion to $648.7 billion as of May 17, marking an all-time high. Some support also came with the Finance Ministry's report stating that the economic momentum in the April-June quarter of 2024-25 will continue with a likely boost in the merchandise exports as a result of supply chain resilience, while India's macroeconomic buffers will help navigate through the risk of volatility in oil prices. Sentiments remained positive in afternoon deals amid positive global cues. Traders took a note of the Ministry of Commerce & Industry's statement that the World Intellectual Property Organization (WIPO) treaty on intellectual property, Genetic resources and associated traditional knowledge, is a significant win for countries of the global South and for India, which is a mega biodiversity hotspot with abundance of traditional knowledge, and wisdom. However, the indices gave up the day's gains and turned flat towards the end of the session amid foreign fund outflows. Foreign institutional investors (FII) sold shares worth Rs 944.83 crore on May 24, 2024, according to the provisional data available on the NSE. Some concern also came as the data showed that India has recorded a trade deficit, the difference between imports and exports, with nine of its top 10 trading partners, including China, Russia, Singapore, and Korea, in 2023-24. The data also showed that the deficit with China, Russia, Korea, and Hong Kong increased in the last fiscal compared to 2022-23, while the trade gap with the UAE, Saudi Arabia, Russia, Indonesia, and Iraq narrowed. Finally, the BSE Sensex fell 19.89 points or 0.03% to 75,390.50, and the CNX Nifty was down by 24.65 points or 0.11% points to 22,932.45.

The US markets were closed on Monday, May 27, in observance of Memorial Day.

Indian rupee depreciated against the US dollar on Monday mirroring the benchmark indices that erased their gains and ended the day off their record-high levels. Some concern came as the data showed that India has recorded a trade deficit, the difference between imports and exports, with nine of its top 10 trading partners, including China, Russia, Singapore, and Korea, in 2023-24. The data also showed that the deficit with China, Russia, Korea, and Hong Kong increased in the last fiscal compared to 2022-23, while the trade gap with the UAE, Saudi Arabia, Russia, Indonesia, and Iraq narrowed. On the global front, the dollar held steady on Monday, but was set for its first monthly loss this year, as investors were focused on U.S., European and Japanese inflation data to guide the global interest rate outlook. Finally, the rupee ended at 83.13 (Provisional), weaker by 3 paise from its previous close of 83.10 on Friday.

The FIIs as per Monday's data were net sellers in equity segment, while they were net buyers in debt segment. In equity segment, the gross buying was of Rs 11235.38 crore against gross selling of Rs 12172.46 crore, while in the debt segment, the gross purchase was of Rs 2020.44 crore with gross sales of Rs 1367.60 crore. Besides, in the hybrid segment, the gross buying was of Rs 35.36 crore against gross selling of Rs 114.81 crore.

The US markets remained closed on Monday on account of Memorial Day. Asian markets are trading mostly in green on Tuesday with marginal gains as investors assess comments from the European Central Bank officials signaling that rate cuts may be on the horizon for the world's largest economic bloc. Indian markets closed slightly lower on Monday after hitting record highs, with energy and auto stocks leading the decline. Today, markets are likely to get flat-to-positive start tracking gains in Asian counterparts. Sentiments will get a boost as the India Meteorological Department (IMD) said that India is likely to receive above average monsoon rains this year, retaining its April forecast. Above average rains will help India, which depends heavily on the summer rains for its farm output, boost agriculture and overall economic growth. It said India likely to experience normal rainfall (92-108 per cent of long period average of 166.9 mm) in June. Some support will come as S&P Global Market Intelligence said the Indian government's capital spending, recovery in private consumption and investment are expected to help carry forward the economic momentum post-elections. Some optimism will also come as a global financial institution revised its GDP forecast for India by 10 basis points to 6.7 percent expecting a sustained growth momentum with additional fiscal space on account of a bumper dividend transfer from the central bank. It also expects the Reserve Bank of India to go for a rate cut in the October-December quarter as it forecast an uptick in core goods inflation due to a rise in manufacturing costs. However, upside may remain capped amid foreign fund outflows. In the domestic market, foreign institutional investors (FIIs) offloaded shares worth Rs 541.22 crore on Monday. Besides, capital markets regulator Sebi lowered the required average daily turnover for launching options on agricultural and agri-processed commodities to Rs 100 crore from Rs 200 crore earlier. Telecom company's stocks will be in limelight with a report that the telecom companies will have to pay Goods and Services Tax (GST) along with the instalments towards spectrum charges. There will be some reaction in insurance industry stocks with ICRA's report that the general insurance industry is expected to earn a gross direct premium income (GDPI) of Rs 3.7 lakh crore by FY26, an increase of 32 per cent from Rs 2.8 lakh crore in FY24. It said while the growth for private insurers is expected to remain strong and that of PSU insurers is likely to remain moderate because of the weak capital position. In stock specific movement, LIC stock will be in focus after the state-run insurance behemoth reported 2.5 per cent year-on-year (Y-o-Y) growth in net profit to Rs 13,762.64 crore, impacted by wage revision and arrears. LIC's board recommended a final dividend of Rs 6 per share. Meanwhile, Indian Railway Catering and Tourism Corporation (IRCTC), MTAR Technologies, NBCC, Prestige Estates Projects, RITES, TTK Prestige, Aditya Birla Fashion and Retail, Wockhardt, Brigade Enterprises, Campus Activewear, are among others to report their quarterly numbers later in the day.

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

Index

Previous close

Support

Resistance

NSE Nifty

22,932.45

22,832.16

23,071.76

BSE Sensex

75,390.50

75,040.62

75,875.03

Nifty Top volumes

Stock

 

Volume

Previous close (Rs)

Support (Rs)

Resistance (Rs)

(in Lacs)

Tata Steel

304.11

175.70

174.46

177.31

NTPC

218.92

370.15

365.26

377.76

Wipro

204.92

453.60

449.41

459.96

HDFC Bank

146.93

1528.00

1516.36

1542.31

ONGC

137.20

278.30

274.60

283.10

  • HCL Technologies has collaborated with Arm to augment custom silicon chips that support AI-driven business operations.
  • Bharti Airtel has registered 1.9 million customers using 5G service in the state of Odisha.
  • GAIL (India) has commissioned maiden green hydrogen plant at Vijaipur in Madhya Pradesh.
  • Divi's Laboratories has reported 67.60% rise in its consolidated net profit at Rs 538 crore for Q4FY24 as compared to Rs 321 crore for the same quarter in the previous year. 

News Analysis