Nifty 8724/Sensex 28155/ Bank Nifty 20163
12 Advances / 38 Declines/ 1 Unchanged
Indian benchmarks end a disappointing day with half a percent cut
Indian benchmark indices extended their downfall for second consecutive day on Wednesday and finished the choppy day of trade with a cut of over half a percent on account of sustained selling by investors amid the dismal earnings by some blue-chip companies.
Auto major Tata Motors slipped as much as ten percent after the company reported 96.22% fall in its consolidated net profit at Rs 111.57 crore for the quarter ended December 31, 2016, as compared to Rs 2952.67 crore for the same quarter in the previous year. India's largest drug maker Sun Pharmaceutical Industries declined over four percent after the company reported 4.73% drop in its consolidated net profit at Rs 1471.82 crore for Q3 FY17, as compared to Rs 1544.85 crore for the same quarter in the previous year.
Further, investors turned jittery after the US Federal Reserve Chair Janet Yellen hinted at a likely rate hike in the forthcoming policy review. In her semi-annual monetary policy testimony before the Senate Banking Committee, Yellen said that the Fed will probably need to raise interest rates at an upcoming meeting in March and that delaying rate increases could leave the Fed's policymaking committee behind the curve.
On the domestic front, sentiments remained dismal as India Ratings (Ind-Ra) cautioned the government that its strategy to revive economic growth by focusing on infrastructure may not yield results unless real estate and manufacturing sectors recover. Revising down economic growth by one percentage point to 6.8% from earlier 7.8% for the current financial year, due to demonetisation, the rating agency pegged economic expansion in the next financial year to 7.4%. Some market participants remained on the sidelines and refrained from any buying activity, ahead of the 10th meeting of the all-powerful GST Council this weekend, where a critical anti-profiteering clause in the draft Goods and Services Tax law to ensure that the benefit of lower taxes gets shared with consumers is likely to be finalized.
The Council, headed by Finance Minister Arun Jaitley and comprising representatives of all states, is also likely to finalise the definition of 'agriculture' and 'agriculturist' as well as the constitution of a 'National Goods and Services Tax Appellate Tribunal' to adjudicate on disputes. Meanwhile, banking stocks came under pressure on the private report that India may cut the amount of capital it plans to inject into state-controlled lenders this fiscal year by as much as Rs 7,800 crore ($1.2 billion) because of slow loan growth. The government, which had promised to inject Rs 25,000 crore into the lenders in the year ending March 31, has decided to defer Rs 2,100 crore of pledged amount into next financial year.
On the global front, Asian equity markets ended mostly higher on Wednesday as wall street touched record highs overnight after Federal Reserve Chair Janet Yellen painted a largely upbeat picture of the world's largest economy during the first day of her two-day testimony and indicated the central bank could raise short-term interest rates at its next policy meeting in March. While Japanese market edged higher as the yen's weakness lifted exporters, Chinese stocks ended lower, as technology and resource stocks took a breather after their recent strong rally. Meanwhile, European stocks pushed higher for a seventh straight session, with banks leading the gains after Janet Yellen sparked a rally in financial stocks by hinting U.S. interest rates soon will go higher.
Back home, the local benchmarks got off to a soft start as the indices showed signs of consolidation in early trade. Thereafter, the key indices failed to show any kind of fervor due to lack of encouraging leads. The selling pressure accentuated in the noon trades as investors took to across the board risk aversion. However, the bourses recovered from the lows of the day but could not succeed in minimizing the huge losses by the end of trading session.
FII Activity (15th Feb 2017)
The FIIs as per Wednesday’s data were net sellers in equity segment, while they were net buyers in debt segment, according to data released by the NSDL.
In equity segment, the gross buying was of Rs 4397.88 crore against gross selling of Rs 4414.31 crore. Thus, FIIs stood as net sellers of Rs 16.43 crore in equities.
In the debt segment, the gross purchase was of Rs 1908.56 crore with gross sales of Rs 841.88 crore. Thus, FIIs stood as net buyers of Rs 1066.68 crore in debt.
Now what to expect next??
Nifty Future Levels
Support 8720 and resistance at 8850.
Break and sustain below 8720 will take it to 8680—8650 and then to 8600 else could touch its resistance level if 8850 again.
Further upside rally will see above 8850
Bank Nifty Future Levels
Support at 19900 and resistance at 20650.
Trend looks positive and could touch its resistance level of 20650, further upside rally will see on close above 20650 else could touch its support level of 19900
Looks weak only below 19900
Today's Top Pick
Jet Airways
Below 350 panic likely to remain continue till 340—330 further downside panic if close below 330.
Resistance and stop loss above 370
More will update soon!!
