Nifty 8946/Sensex 28999/ Bank Nifty 20627
17 Advances / 34 Declines/ 0 Unchanged
Indian benchmarks retreat from two-year closing highs; Sensex closes below 29000 mark
Indian benchmark indices, after hitting two-year closing highs in the previous session, ended lower on Tuesday as market participants remained wary over the latest tumult surrounding the Trump administration and geopolitical tensions emanating from North Korea. Traders were also grappled with the likelihood of an interest rate hike by the US Federal Reserve at its meeting next week.
Sentiments remained subdued with Deputy Governor of the Reserve Bank of India’s (RBI) statement that the impact of demonetisation on the informal sector is not fully captured in the GDP data and the effects of demonetisation is expected to spill over to certain segments of the economy in this quarter.
However, he also said that the impact of the notes ban would only be temporary and would help in bringing informal sector into the mainstream economy. Investors got some comfort with the Global rating agency Fitch’s report that Indian economy will grow by 7.1% in the current financial year before stepping up to 7.7% in the next two financial years. It said the December quarter GDP number suggests that economic activity was ‘hardly hit’ by the cash crunch after the government's move to remove 86 per cent of currency in circulation overnight.
Meanwhile, some Pharma stocks came under pressure on the report that growth of the domestic pharmaceutical industry is expected to remain moderate due to slowing growth in the US, increased regulatory scrutiny and consolidation of supply chain in the US market. In near term, the direction of markets will likely hinge on the results of the elections in Uttar Pradesh, due on Saturday, which will have a key influence on Prime Minister Narendra Modi's chances of clinching a second term in 2019.
On the global front, Asian equity markets ended mostly higher on Tuesday as investors digested new economic data and grew optimistic of a new interest rate hike in the U.S. as early as this month.US factory orders rose 1.2% month-on-month and durable goods orders climbed 2%, both beating the market consensus. While Japanese shares ended lower with rising geopolitical tensions, French election uncertainty and overnight losses in the US markets, Chinese markets edged higher, aided by renewed interest in technology shares in late trading after a listless morning session. Market participants piled up tech shares for the second day following Premier Li Keqiang's Work Report on Sunday that identified innovation as a key part of China's economic restructuring. Meanwhile, European stocks traded with mixed signs on Tuesday after Germany reported disappointing data and a third estimate of euro zone gross domestic product (GDP) was left unrevised.
Back home, after getting positive start, the local benchmarks slipped in to negative territory in early trade and continued to trade choppy throughout the session, as investors remained cautious ahead of key exit poll data for assembly elections in five states.
FII Activity (07th March 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 8699.96 crore against gross selling of Rs 7859.04 crore. Thus, FIIs stood as net buyers of Rs 840.92 crore in equities.
In the debt segment, the gross purchase was of Rs 913.34 crore with gross sales of Rs 388.22 crore. Thus, FIIs stood as net buyers of Rs 525.12 crore in debt.
Now what to expect next??
Nifty Future Levels
Support at 8870 and Resistance at 8980—9050
Looks positive and could touch its resistance level of 8980—9050, further upside rally will see on close above 9050, else could touch its support level of 8870 again.
Fresh selling can be initiated below 8870.
Bank Nifty Future Levels
Support at 20500 and resistance at 21025
Looks positive and could touch its resistance level of 21025, further upside rally will see above 21025, else could touch its support level of 20500.
Looks weak below only 20500.
Trade in a range with levels only.
More will update soon!!
