Nifty 8082/Sensex 26307/ Bank Nifty 18069
20 Advances /31 Declines/ 0 Unchanged
“Benchmarks end a lackluster session with modest cut; Nifty ends below 8100 mark”
Indian benchmarks indices extended the sorrow of closing in the red territory for the fifth consecutive session on Tuesday as investors shied away from taking any big bets on rising geopolitical concerns in Turkey, Germany and Switzerland. Sentiments took a hit after Global financial services major Nomura revised upwards India's current account deficit (CAD) forecast to 1.4% of GDP for the current fiscal from 0.4% earlier.
According to Nomura, India's trade deficit widened to a 16-month high of $13 billion in November from $10.4 billion in October, as a result of a sharp slowdown in exports after demonetization and a pickup in imports, led by gold and higher commodity prices. For the fourth quarter (October-December) of 2016 Nomura expects a current account deficit of 2.5% of GDP (versus 0.9% earlier) and for the January-March period, it is likely to be around 2% of GDP. Trading sentiments weakened further on report that foreign portfolio investors (FPIs) sold shares worth a net Rs 535.77 crore on December 19, 2016.
The downside remained capped with Finance Minister Arun Jaitley’s statement that Reserve Bank of India was fully prepared to deal with currency shortages post demonetisation and has enough currency in its chests to last 'far beyond' December 30, 2016.
Some support also came with NITI Aayog member Ramesh Chand’s statement that despite the impact of demonetisation, growth in agriculture for the current year will still be above 5 per cent, though he pointed that the prevailing cash crunch has hit the growers of perishables more compared to those who grow bulk crops such as paddy and cotton. Meanwhile, Aviation stocks came under pressure after the report that India’s Airlines industry may have to bear an additional tax burden of up to Rs 15,000 crore annually once the Goods and Services Tax (GST) is implemented. The additional tax burden may push airlines, most of which have turned profitable, into losses again, coming as it does at a time when global fuel prices are flaring up.
On the global front, Asian markets ended mixed on Tuesday, with Chinese and Hong Kong shares ending in the red on waning hopes for additional monetary stimulus and concerns surrounding a tighter regulatory environment. Market participants remained cautious after U.S. Federal Reserve Chair Janet Yellen gave an upbeat view of the jobs market, strengthening the rate hike outlook for next year. Yellen said on Monday that the U.S. labour market had improved to its strongest in nearly a decade, suggesting that wage growth was picking up and underscoring expectations that the central bank would continue to raise interest rates next year. However, Japanese market ended higher after the market digested the Bank of Japan's decision to maintain current monetary policy.
Bank of Japan kept monetary policy steady and gave a more upbeat view of the economy on Tuesday, reinforcing market expectations that its future policy direction could be an increase - not a cut - in interest rates. Meanwhile, European stock markets moved mostly higher, with Italian banks among the biggest gainers after news the country’s government is preparing a bailout package for struggling lenders.
Back home, after getting a positive start, the local benchmarks showed some strength in early trades, but the sentiments turned pessimistic in noon trades and indices start drifting lower, tracking weak trade in other regional markets. Thereafter, the indices traded in tight range below neutral line with moderate losses for most part of the session. Finally, the NSE’s 50-share broadly followed index - Nifty settled with modest losses of twenty one points, below the psychological 8100 levels below the psychological 26500 mark.
Now what to expect??
Nifty Future Levels
Nifty took support level of 8070 as it made low of 8072 and bounced back.
Break and sustain below 8070 will take it to 7930—7850 and then to 7780 else could test its resistance level of 8150 again.
Further upside rally will see only above 8150 mark
Today's Top Pick
UltraTech Cement
We have seen almost 2% sharp jump in UltraTech Cement, prices seems to have bottom out.
Above 3180 it can touch 3230—3260 and then to 3300+ marks in days to come.
Support and stop loss below 3110
