by admin | May 25, 2021 | Economy, Markets, News
By Porisma P. Gogoi,
Mumbai : Release of key domestic macro-economic data, combined with global market volatility and movement of funds, are expected to dictate the direction of the Indian equity markets during the week ahead, say market analysts.
“Apart from other developments on the domestic front, the Indian equity markets would seek direction from global markets as the results (earnings) season is almost over,” D.K. Aggarwal, Chairman and Managing Director of SMC Investments and Advisors, told IANS.
“Also, the movement of funds and crude oil prices are expected to influence the market sentiment next week,” he added.
Provisional figures from the stock exchanges showed that last week foreign institutional investors (FIIs) sold off scrips worth Rs 5,781.98 crore, while domestic institutional investors (DIIs) purchased scrips worth Rs 5,972.69 crore.
Figures from the National Securities Depository (NSDL) revealed that foreign portfolio investors (FPIs) off-loaded equities worth Rs 3,054.94 crore, or $468.06 million, from February 20 to 23.
“On the macro front, fiscal deficit data, core sector data for January and estimates for October-December GDP (gross domestic product) data will be announced on February 28. Automobile sales data by automakers and Nikkei Manufacturing PMI (Purchasing Manager’s Index) for February will be announced on March 1,” Arpit Jain, Assistant Vice President at Arihant Capital Markets, told IANS.
In addition, the Central Statistics Office (CSO) is expected to release the macro-economic data points of Index of Industrial Production (IIP) on February 28.
According to Vinod Nair, Head of Research, Geojit Financial Services, investors will wait for fresh triggers to get direction in the week ahead.
“As per the quarter results, the corporate earnings have started to pick up but concern on inflation and hike in interest rate may add pressure on the near-term valuation,” said Nair.
“The sustainability in the global market is another key factor which may influence domestic investors’ sentiments,” he added.
Analysts were optimistic that the upcoming week could witness a recovery of the key indices from lower levels.
“Nifty and Sensex made a strong come-back post the bad expiry series for February, closing above the 10,490 and 34,000 marks, respectively, on the first day of March derivative series on February 23,” said Dhruv Desai, Director and Chief Operating Officer of Tradebulls.
“Therefore we believe that the final week of February should see a termination of the down move and a reversal sign is in the offing which could turn the tide in favour of bulls soon,” Desai told IANS.
Last week, the key Indian equity indices bounced back from their lows to close with humble gains on value buying by investors after three weeks of consecutive losses.
On a weekly basis, the barometer 30-scrip Sensitive Index (Sensex) of the Bombay Stock Exchange (BSE) edged higher by 131.39 points or 0.39 per cent to close at 34,142.15 points.
The wider Nifty50 of the National Stock Exchange (NSE) closed trade at 10,491.05 points — up 38.75 points or 0.37 per cent from its previous week’s close.
The equity markets will remain closed on March 2 (Friday) for Holi.
(Porisma P. Gogoi can be contacted at porisma.g@ians.in )
—IANS
by admin | May 25, 2021 | Economy, Markets, News
By Porisma P. Gogoi,
Mumbai : Apart from developments on the domestic front, the Indian equity markets would seek direction from global markets during the coming week, said market analysts.
“With the results season almost over, all the focus will continue to remain on the global cues,” Arpit Jain, AVP at Arihant Capital Markets, told IANS.
“Last week, the Dow Jones increased by 4.5 per cent and recovered 50 per cent of its recent losses. Hence, once the domestic concerns settle, Indian indices are likely to take part in global rally,” he added.
In addition to global cues, the movement of funds and crude oil prices are expected to influence the market sentiment next week.
“It is expected that volatility of global stock markets, along with rupee-dollar movement, inflow of funds from both foreign and domestic market participants and crude oil prices are expected to influence the domestic market going forward,” D. K. Aggarwal, Chairman and Managing Director of SMC Investments and Advisors, told IANS.
Last week, the rupee strengthened by 18-19 paise to close at 64.21-22 against the US dollar.
Provisional figures from the stock exchanges showed that foreign institutional investors remained net sellers last week and sold off scrips worth Rs 2,849.1 crore.
However, domestic institutional investors purchased scrips worth Rs 2,368.01 crore.
With various developments taking place in the banking sector of the country, analysts were of the view that the NSE Nifty50 could be further dragged lower by the Bank Nifty index — which has a greater weightage — the following week.
“What we saw during the past week was a ‘time-wise’ correction. Next week, we will be proceeding towards the next leg of correction and may see markets drifting lower,” said Sacchitanand Uttekar, Assistant Vice-President, Research at Tradebulls.
According to Uttekar, banks were leading the downward rally because of domestic cues like the $1.8 billion Punjab National Bank (PNB) fraud and the state-run banks drifting lower.
“Since the last two sessions, the scenario has changed with the private banks also taking a hit. The Bank Nifty index was dragging the Nifty50 lower,” Uttekar told IANS.
A massive sell-off in the banking sector stocks was triggered last week after the Reserve Bank of India (RBI) announced new norms to deal with non-performing assets.
Besides, the multi-crore fraud detected at one of the Mumbai branches of PNB led to a drastic decline in the shares of the company, along with the PSU Bank Nifty index.
“Going forward, banks could see much deeper levels and magnitude of the fall could be higher for the Bank Nifty,” Uttekar added.
On technical levels, Deepak Jasani, Head, Retail Research, HDFC Securities, said: “With the Nifty continuing to correct the past week after breaking a trend line support a few weeks back, the underlying short-term trend remains down.”
“Further downsides are likely early next week once the immediate support of 10,434 is broken. Any pull-back rallies could find resistance at 10,618,” Jasani told IANS.
Last week, trade in the Indian equity markets was almost flat with a slew of domestic developments like the PNB fraud impacting the market mood.
On a weekly basis, the barometer 30-scrip Sensitive Index (Sensex) rose a tad by 5 points or 0.01 per cent to close at 34,010.76 points. The wider Nifty50 of the National Stock Exchange closed a bit lower by 2.65 points or 0.02 per cent at 10,452.30 points.
(Porisma P. Gogoi can be contacted at porisma.g@ians.in )
—IANS
by admin | May 25, 2021 | Economy, Markets, News
By Rohit Vaid,
Mumbai : The volatility of global stock markets, along with macro-economic data points, are expected to influence the Indian equity market next week, opined analysts.
Market observers pointed out that the ongoing quarterly results season and crude oil price fluctuations, combined with the direction of foreign fund flows and the rupee’s movement against the US dollar, will also impact investors’ risk-taking appetite.
“The markets next week will focus on earnings, macro-data and, of course, global cues,” Devendra Nevgi, Founder and Principal Partner, Delta Global Partners, told IANS.
“The global markets remain volatile, which might spill over to Indian markets. FPIs (Foreign Portfolio Investors) have been net sellers, hence support from DIIs (Domestic Institutional Investors) remains important in event of global volatility.”
In the past few weeks, a massive sell-off in the global markets has pulled the Indian equity indices deep into the red. Since February 1, 2018, the Bombay Stock Exchange (BSE) Sensex has shed around 1,900 points and the National Stock Exchange (NSE) Nifty50 over 500 points.
According to securities market regulator Sebi’s Chairman Ajay Tyagi, Indian stock market volatility “may continue” for some more time due to global factors.
However, he assured that “there is no cause of worry” in terms of volatility, as the country has a robust risk-management system and that “there is no issue in terms safety of contracts or enforcement of contracts”.
Answering a query on Economic Survey’s recommendation for the need to be vigilant of stock market movements, Tyagi said: “There is no cause of worry in terms of volatility.”
“Volatility, perhaps, may continue for some time, because, as you see in the US, the unemployment rates have really come down, wage rates have really gone up, so, maybe it is more than what was expected,” he said at a press briefing in New Delhi on Saturday.
The Economic Survey 2017-18, tabled in Parliament on January 29, had called for a vigil against a likely stock market bubble and that “sustaining” the current high valuations require “future earnings” to meet high expectations.
Apart from global cues, the ongoing quarterly results season assumes significance as major firms like GAIL, Indian Hotels, DLF, Fortis Healthcare, GMR Infra, Welspun India, Idea Cellular, Jet Airways, Nestle India and Sun Pharma are expected to announce their quarterly results in the coming week.
“The current earnings season is providing strong signs of revival in corporate earnings, underlining the long-term growth prospects,” said Vinod Nair, Head of Research, Geojit Financial Services.
“However, the prevailing inflationary pressure and fiscal slippage may turn RBI to take a more hawkish stance in the near future. Considering this, the near-term profitability of domestic corporate might get impacted by higher inflation and interest cost.”
Besides the Q3 results, investors will keep a close watch on the upcoming macro-economic data points such as the Index of Industrial Production (IIP), Consumer Price Index (CPI), Wholesale Price Index (WPI) and Balance of Trade figures.
The Central Statistics Office (CSO) is slated to release the macro-economic data points of IIP and CPI on February 12.
“In the week ahead, December IIP, January CPI and WPI inflation data are key triggers for the market,” Nair said.
“The CPI inflation is expected to reduce marginally to 5.1 per cent from 5.2 per cent, while IIP to decelerate to 6.1 per cent versus 8.4 per cent.”
On technical levels, the underlying short-term trend of the NSE’s Nifty50 remains bearish.
“Technically, with the Nifty continuing to correct this week after breaking a trend line support in the previous week, the underlying short-term trend remains down,” said Deepak Jasani, Head of Retail Research for HDFC Securities.
“Further downsides are likely once the immediate supports of 10,276 points are broken. Any pull-back rallies could find resistance at 10,703 points.”
Last week, the key Indian equity indices — the BSE Sensex and the NSE Nifty50 — receded for the second consecutive week on the back of a massive global stock markets’ sell-off.
Consequently, the barometer 30-scrip Sensitive Index (Sensex) tanked by 1,060.99 points or 3.02 per cent to close at 34,005.76 points.
Similarly, the wider Nifty50 of the National Stock Exchange (NSE) closed the week’s trade at 10,454.95 points — shedding 305.65 points or 2.84 per cent from its previous week’s close.
(Rohit Vaid can be contacted at rohit.v@ians.in)
—IANS
by admin | May 25, 2021 | Economy, Markets, News
By Rohit Vaid,
Mumbai : Announcements on capital expenditure, along with policy reforms and expected sops from the the Union Budget 2018-19, will determine the trajectory of the Indian equity markets in the coming week.
According to market observers, other themes for the trade week starting on January 29, will be macro-economic growth and select industrial production data points coupled with stock-specific movement due to the ongoing earnings result season.
“The budget remains critical, being the first one after GST (Goods and Services Tax) implementation and the last full year budget before the general elections in 2019,” Devendra Nevgi, Founder and Principal Partner, Delta Global Partners, told IANS.
“The balancing act for the Finance Minister on reining in the fiscal deficit, rural populism and growth-boosting measures (private capex) remain the key themes that will be watched closely.”
Parliament’s budget session will kick off with the presentation of the Economic Survey 2017-18 on Monday, January 29, followed by the Union Budget 2018-19 on February 1.
“With crude oil prices surging, fiscal deficit projections in the upcoming budget will be keenly watched. The budget is expected to dictate the future direction of markets from here on,” D.K. Aggarwal, Chairman and Managing Director of SMC Investments and Advisors, told IANS.
Apart from the budget, the week ahead will be heavily influenced by Q3 corporate earnings and the direction of foreign fund flows. Companies like HDFC, EIH, IndianOil, Piramal Enterprises, TVS Motor Company, ICICI Bank, L&T, NTPC, Vedanta, Titan Company, Bajaj Auto and Hindalco Industries are expected to announce their quarterly results in the coming week.
“Next week, till the Union Budget announcement, markets are expected to be driven by corporate earnings and the buoyant global markets as FPI (foreign portfolio investors) flows remain strong,” Nevgi said.
Besides quarterly results, macro-economic data points like GDP figures for 2017-18, Index of Eight Core Industries (ECI) figures and the country’s fiscal deficit data up to December will be keenly watched by investors.
In addition, monthly automobile sales figures and the Purchasing Managers’ Index (PMI) manufacturing and services data will become other major sentiment drivers.
On the currency front, the rupee’s strength will be arrested by higher crude oil prices, “as it will make rupee less attractive”.
“Next week, we expect USD/INR to trade within a range of 63.30 to 63.80. Rupee is expected to remain weak against the euro and pound,” Anindya Banerjee, Deputy Vice President for Currency and Interest Rates with Kotak Securities, told IANS.
The Indian currency had strengthened by 30 paise during the week ended January 25, to close at Rs 63.55 against the US dollar from its last week’s close at Rs 63.85.
In terms of technical charts, the underlying uptrend in the National Stock Exchange (NSE) Nifty is expected to continue.
“Technically, with the Nifty surging higher to new record highs, the underlying intermediate uptrend remains intact,” Deepak Jasani, Head – Retail Research, HDFC Securities, told IANS.
“Further upsides are likely once the immediate resistances of 11,110 points are taken out. Weakness could emerge if the supports of 10,881 points are broken.”
Last week, key indices made gains on the back of revival in corporate earnings, along with the country’s healthy economic growth outlook projected by the International Monetary Fund and massive inflow of foreign funds.
Consequently, the 30-scrip Sensitive Index (Sensex) of the Bombay Stock Exchange closed at 36,050.44 points — up 538.86 points or 1.52 per cent from its previous week’s close.
Similarly, the NSE Nifty closed higher by 174.95 points or 1.60 per cent to 11,069.65 points.
(Rohit Vaid can be contacted at rohit.v@ians.in)
—IANS
by admin | May 25, 2021 | Economy, Markets, News
By Rohit Vaid,
Mumbai : The Indian equity markets are expected to be influenced by the ongoing earnings result season, along with F&O expiry next week, experts opined.
Besides Q3 earnings, global crude oil prices and the flow direction taken by the foreign funds are expected to act as other major triggers, said market observers.
“For the next week the focus again will be on earnings and global markets. The broader earnings declared so far have been decent with net profits rising in late teens, more than the revenue gains,” Devendra Nevgi, Founder and Principal Partner, Delta Global Partners, told IANS.
“Banks and cyclical sector earnings would be closely watched for clues on… the NPA cycle. The buoyancy in global markets and the stronger FPI flows would provide a floor to the markets.”
Companies like Asian Paints, Axis Bank, Biocon, Idea Cellular, Interglobe Aviation, Larsen & Toubro, Pfizer, Dr Reddys Laboratories, Jindal Steel & Power and Maruti Suzuki India are expected to announce their quarterly results in the coming week.
Further, Nevgi said: “Crude oil prices, if sustained around $70 per barrel can derail the positive sentiment. Globally, the risk of US government shutdown, the statements made during WEF in Davos and Bank of Japan next week would be closely watched.”
According to Shibani Kurian, Senior Vice President and Head of Equity Research, Kotak Mutual Fund: “With the rise in oil prices, India’s Current Account Deficit outlook is under some pressure even while the robust forex reserves and strong portfolio flows gives adequate cushion to manage the widening deficit.”
Official data released last week showed that the country’s overall Forex reserves had risen to $413.82 billion as on January 12, 2018.
In terms of investments, provisional figures from the stock exchanges revealed that foreign institutional investors purchased scrip worth Rs 4,234.46 crore.
On the currency front, the rupee is expected to range from 63.50 to 64.10 against a US dollar. Last Friday, the rupee had weakened by 22 paise to close at 63.85 against the dollar.
“Over the past week, sell-off in local bonds and rising oil prices have caused rupee to depreciate towards 64.10, before the pair retraced and settled around 63.84 levels on spot,” Anindya Banerjee, Deputy Vice President for Currency and Interest Rates with Kotak Securities, told IANS.
“Higher oil prices and concerns over government finances is keeping the domestic bond markets within the grip of bears. The same set of factors is also keeping rupee an underperformer in the EM basket as well. FPIs are favouring currencies of commodity producers….”
As per technical charts, the uptrend in Nifty “remains intact”.
“Technically, with the Nifty surging higher to new record highs, the underlying intermediate uptrend remains intact,” Deepak Jasani, Head – Retail Research, HDFC Securities, told IANS.
“Further upsides are likely once the immediate resistances of 10,907 points are taken out. Weakness could emerge if the supports of 10,666 points are broken.”
Last week, upbeat quarterly corporate earnings and influx of foreign funds lifted the key equity indices — the Sensex and the Nifty50 — to close at record high levels.
Consequently, the barometer 30-scrip S&P Sensex of the Bombay Stock Exchange surged by 919.19 points or 2.66 per cent to close at a fresh high level of 35,511.58 points.
Similarly, the wider Nifty50 of the National Stock Exchange made healthy gains. It rose by 213.45 points, or 2 per cent to 10,894.70 points.
(Rohit Vaid can be contacted at rohit.v@ians.in)
—IANS
