Nifty 8561/Sensex 27655/ Bank Nifty 19515
11 Advances / 39 Declines/ 1 Unchanged
Indian benchmarks edge lower as caution prevails ahead of Union Budget
Indian equity benchmarks carried forward their southward journey for yet another session on Tuesday as participants kept their bets to a minimum ahead of the federal budget, while the risk sentiment was hit as Asian shares fell on worries over US President Donald Trump's immigration policy.
The Union Budget 2017 will be a tightrope for Finance Minister Arun Jaitley to boost public spending and also keep deficit within limits. Local sentiments also got undermined by the Economic Survey 2016-17, tabled by chief economic adviser Arvind Subramanian, estimating economic growth to moderate to 6.5% in the current fiscal year ending March 2017, down from 7.6% reported in the previous fiscal.
It also outlines three main downside risks to FY18 GDP growth forecast adding that demonetisation, rise in oil prices and global trade tensions will affect the growth forecast. The Economic Survey, however, sees India's GDP rebounding sharply in the range of 6.75-7.50 percent during the fiscal year ending March 2018. Painting a rosy picture on the agriculture sector, the survey sees farm sector to grow at a healthy rate of 4.1 percent in the current fiscal as against 1.2 percent growth achieved in 2015-16. Furthermore, market participants remained anxious with the CII - IBA Financial Conditions Index for Q4 (January-March) FY2016-17 recording a drop below the 50 mark owing to expectation of banks and financial institutions of deterioration in the overall financial conditions in the economy.
Meanwhile, banking stocks declined on the report that demonetisation is likely to push back recovery in banks' asset quality as the cash shortage had a ‘disruptive impact’ on India's informal economy. Cash shortages caused by the demonetisation of large denomination currency notes have affected the income of many borrowers by holding back economic activity and reduced their short-term repayment abilities. Furthermore, IT stocks slipped as investors panicked over US President Donald Trump plans to keep his electoral promise of imposing tougher immigration rules on the H1B visa plans. India's IT sector will face temporary setback to move workers from India to the US with the bill introduced in the US House of Representatives that mandates minimum wages of H1B visa holders at $130,000, double the current limit.
On the global front, Asian equity markets ended lower on Tuesday as worries about the economic impact of US President Donald Trump's immigration policies continued to weigh on markets. Japanese shares ended lower as the yen strengthened against the dollar and euro, and the Bank of Japan kept its policy settings unchanged at its first meeting of the year, underlining its nervousness about how Trump plans to implement his pro-growth policies. However, European stocks gained some ground in early trade, following their selloff in the previous session as banking stocks rebounded, while forecast-beating earnings from Hennes & Mauritz AB sparked a rally in the retail sector.
Back home, the local benchmark got off to a sombre opening, extending the downtrend for the second straight session as pessimistic sentiments prevailed across Asian markets. The selling pressure accentuated in the late morning trades as investors took to across the board risk aversion. The key gauges made some attempts to pull-back in early afternoon trades, but profit booking at higher levels dragged the key indices to the lowest point in the session.
FII Activity (31st January 2017)
The FIIs as per Tuesday’s data were net buyers in equity and debt segments both, according to data released by the NSDL.
In equity segment, the gross buying was of Rs 3336.30 crore against gross selling of Rs 2600.98 crore. Thus, FIIs stood as net buyers of Rs 735.32 crore in equities.
In the debt segment, the gross purchase was of Rs 540.83 crore with gross sales of Rs 260.14 crore. Thus, FIIs stood as net buyers of Rs 280.69 crore in debt.
Key Results
Apollo Tyres Ltd
BASF India Ltd
CCL Products (India) Ltd
Cummins India Ltd
Eicher Motors Ltd
Equitas Holdings Ltd
Grindwell Norton Ltd
Gujarat Pipavav Port Ltd
Himatsingka Seide Ltd
Majesco Ltd
Pidilite Industries Ltd
Shree Renuka Sugars Ltd
State Bank of Travancore
Suven Life Sciences Ltd
Tata Global Beverages Ltd
Now what to expect??
Nifty Future Levels
Nifty unable to breach its resistance level of 8720—8750 …it crashed vertically and made low of 8576.
Now what to expect???
Support at 8550 and Resistance at 8720—8750
Looks weak and could touch its support level of 8550.
Further downside panic will see below 8550 else could touch its resistance level of 8720--8750
Fresh buying can be initiated above 8750 on closing basis.
Trade with levels only.
Bank Nifty Future Levels
Support at 19400 and resistance at 19800—20400
Looks weak only below 19400. Break and sustain below 19400 will take it to 19100—18800 else could touch its resistance level of 19800—20400 again.
Trade with levels only.
Today's Top Pick
We’ll likely to expect high volatility today. So we recommend traders to trade with strict stop loss and less quantity. Anything seems will update.
More will update soon!!
