Index Trend & Conditions
Major Resistance created at 11,650 for Nifty50
For Thursday, Oct 5, Support = 11,300 with Resistance = 11,535 11,600 11,650 for Nifty50
Trends on SGX Nifty indicate a positive and steady outlook for Nifty50 in India with a 100 points gain. The Nifty futures were trading at 11,428 on the Singaporean Exchange at 08:30 IST
US futures trading in green and positive outlook of Asia-Pacific early morning market also indicate a positive open for India
Global Premise
The S&P 500 Index declined in September after five straight monthly advances, and Europe’s Stoxx 600 also pared gains pointing towards a grinding phase forward
Deutsche Bank, which earlier in May warned of a 5.9 per cent fall in global GDP this year, now reckons the contraction will be limited to 3.9 per cent
Fiscal stimulus added 3.7 per cent growth to global GDP this year, according to JPMorgan Chase & Co., who fear that the premature pivot to austerity can hurt the next fiscal
With revenues squeezed globally, businesses could face problems repaying debts, leading to more bankruptcies, and making lenders more reluctant to extend credit even to viable firms
Social distancing regimes in Europe can decide the drop in demand as a permanent phenomenon, instead of a temporary one, forcing companies to shrink their workforce
Rising cases in some major advanced and emerging market economies together with depleted fiscal stimulus in the US and a vaccine that’s still months away add up to an uncertain outlook for the global economy
Recently, Disney announced plans to axe 28,000 workers
Shell said it may cut as many as 9,000 staff and Germany’s Continental AG approved a restructuring plan that will abolish or shift 30,000 jobs worldwide
Europe has seen the fastest manufacturing growth in Europe for September
In China, several indicators are suggesting that the pandemic has started to plateau
Business confidence is at the whim of geopolitics, with the US preparing for election amid its trade tensions with China. The UK’s trade negotiations with the European Union are in flux, with a hard Brexit still a risk
Investors will also keep an eye on developments surrounding US ISM Non-Manufacturing PMI and foreign trade, UK monthly GDP, Eurozone retail sales, Japan current account, Australia business morale and worldwide services PMI surveys
India Markets
| Nifty50 on Thursday | Open 11,364 | High 11,428 | Low 11,347 | Close 11,417 |
Nifty50 on Thursday posted a lively trading session, closing 170 points above day opening at 11,417 after making a high of 11,428
The S&P BSE Sensex ended 1.65% or 630 points higher at 38,697
On the up side, crucial level or resistance is seen at 11,445 11,535 11,600 11,650 for Monday and a breach of 11,600 may bring further upside to the index
While, on the downside, support is seen at 11,300 for Monday
Bank Nifty finally witness a big price-movement on Friday, opening gap-up at 21,685 and making a high of 22,294 before closing at 22,246
India Volatility Index ended 6.04% lower on Thursday at 18.35 with lower volatility hinting at possible bounce back
The overnight call money rate weighted average stood at 3.43% as per RBI data. It moved in a range of 1.80 – 4.00% as on Sep 30
Govt has supported to waive off “interest on interest” for small ticket loans up to 2 Crore for the moratorium period only. The relief is to be extended to all borrowers irrespective of their availed status. Investors are looking up for further clarity
The borrowing category includes MSME loans, Education loans, Housing loans, Consumer durable loans, Credit card dues, Auto loans, Personal loans and consumption loans. This is going to cost the govt between 5,000 to 7,000 Crore.
Govt estimates total interest on all the loans and advances for all classes and categories of borrowers corresponding to the 6-month moratorium period at 6 Lakh Crore
Exports rose 5.27 per cent YoY in Sep to $27.4 Billion after 6-months contraction.
Import slipped 19.6 per cent to $30.31 Billion. Trade deficit in Sep 2020 is $2.91 Billion, while Sep 2019 was $26.02 Billion
Oil Imports fell 36% to $5.82 Billion
Gold Imports dipped by 53%
Net worker remittances dropped to $11.69 billion in the April-June 2020 quarter, down from $13.534 billion in the January-March 2020 quarter
Govt looking to borrow 12 Lakh Crore for FY21, with a target of 4.34 lakh crore, or 36.16 per cent of the total borrowing in October – March 2021
Fourth downward revision in domestic natural gas prices, by 25% to $1.79 per mmbtu. Credit negative for upstream companies, such as ONGC and Oil India. Positive for companies manufacturing of urea and petrochemicals, and gas-based power producers
State-owned RailTel Corporation of India Ltd. has submited draft papers with SEBI for Rs 700 Crore IPO for a complete OFS deal
Silver Lake Partners will invest an additional Rs 1,875 Crore in Reliance Retail Ventures Ltd. This is over and above last week’s investment of Rs 7,500 Crore taking the total investment in retail business to Rs 9,375 crore for an equity stake of 2.13%
Additionally, Singapore’s GIC and private equity firm TPG will invest a combined $1 Billion in Mukesh Ambani’s retail unit, taking total inflows into the business to about $4.4 Billion
Brookfield REIT has filed the draft offer document for its commercial real estate assets in India with SEBI, making it the third real estate investment trust to list after Embassy REIT and Mindspace REIT.
Brookfield REIT is looking to raise 3,800 Crore as Fresh Issuance and another OFS component Punjab National Bank declared its Rs 1,203 Crore exposure to Sintex Industries Ltd. as a fraud
India’s auto sector, which contributes more than 7% to the nation’s GDP, surged in factory gate shipments for September – a measure of auto wholesales – with Maruti Suzuki rising 31% YoY and Hero Motocorp recording 17% YoY growth, highest monthly sales in 2020 so far.
Honda cars reported 10% YoY aggregate growth, TVS Motor’s reported 4.16% YoY aggregate growth, Royal Enfield reports 1% YoY aggregate growth, Tata Motors aggregate sales rose 37% YoY with majority growth seen from passenger vehicles category, Toyota India sales declined 21% YoY, MG Motors dipped 3% YoY, Escort’s tractor sales rose 9.2% YoY, Mahindra’s tractor sales rose 17% whereas SUV and trucks sales fell 17% YoY, Hyundai Motor’s India sales rose 24% and Bajaj Auto Ltd. dispatched 10% more motorcycles to its dealerships in India and abroad.
In Power and fuel consumption category, September has seen power demand back to pre-lockdown levels with the consumption showing a YoY growth of 5.6 per cent compared to a 10 per cent decline in June. The consumption of petroleum products showed signs of worry during July and August, with a YoY decline of 12 per cent and 16 per cent, respectively. However, in the first fortnight of September, petrol consumption grew by 2 per cent and diesel consumption de-grew by 5.5 per cent YoY. This indicative positive trend reversal, if sustained, will have a multiplier effect on the economy GST collections in September stood at 95,000 Crore, witnessing a positive YoY growth after hovering in the negative territory for the previous 6 months
As too much of monetary and fiscal stimulus could lead to un-balanced growth in the economy leading to inflation and fiscal deficit; government’s push for structural reforms in agriculture, land, labour, power, taxation, public and financials, trade and tariff sectors could prove instrumental for the long-term recovery
US Markets
Nasdaq Composite dropped more than 250 points or 2.22% by the closing bell on Friday to close at 11,075
The Dow Jones Industrial Average sank more than 134 points or 0.48% after opening bell to close at 27,683
The S&P500 lost 30 points or 0.96% by to close at 3,348
Russel 1000 Index Growth fell 17 points or 0.90% to close at 1,868
Today in derivatives market, all 3 futures trading in green with Dow futures up 0.75%, S&P500 futures up 0.75% and Nasdaq100 futures up 1.02%
Filing for US employment benefits have remained below 1 million for fifth week
However, California, the most populous state, used the prior week’s numbers because the state suspended acceptance of new applications for two weeks to improve its systems and cope with a backlog of filings
A separate report shows fall in Americans’ incomes in August by the most in three months after the government’s supplemental unemployment benefits expired, threatening to temper consumer spending
US airlines are starting to lay off more than 30,000 workers unless they get additional federal aid
Outside of big companies, Yelp Inc. data show over 97,000 small businesses across the US have shut for good since March 1, 2020
Asia-Pacific Markets
Stocks in Asia-Pacific traded higher Monday morning
China markets are shut for a holiday
In Japan, the Nikkei 225 rose 1.34% in early morning trade to trade at 23,332 while the Topix 500 gained 1.85% and is trading at 1,264
South Korea’s Kospi added 0.35% in morning trade at 2,358
Hong Kong’s Hang Seng Index gained points in morning trade, up 1.61% to trade at 23,836
In China, Shanghai Composite added 0.49% to trade at 3,239 continuing its up trend
Meanwhile, Australia’s S&P/ASX 200 advanced 2.2% in morning trade at 5,930 as shares of the country’s major banks surged
Overall, MSCI’s broadest index of Asia-Pacific shares outside Japan, traded 0.41% higher
EU Markets
The pan-European Stoxx 600 index notched a slim gain of just 0.2% by the closing bell on Friday
Stoxx 50 slipped 0.1% closing at 3,191
Germany’s DAX closed below the 50-day EMA line on Friday, down 41 points or 0.33% or at 12,689
London’s FTSE 100 gained 0.39% to settle at 5902
France’s CAC40 added 0.02% to trade at 4825 by the closing bell
Oil and gas and retail stocks slid 0.4% to lead losses
Construction and material stocks bucked the trend to climb 1.5%
Financial services firms operating in the UK have shifted about 7,500 employees and more than 1.2 trillion pounds ($1.6 trillion) of assets to the European Union ahead of Brexit
Think-tank Bruegel said in 2018 that London could ultimately lose 10,000 banking jobs and 20,000 roles in the financial services industry
London still accounts for the lion’s share of US banks’ assets in Europe. Wall Street’s five big firms underpinned their UK units with $136 Billion of core capital at the end of 2019, while the figure for the EU was $45 Billion only
Oil & Natural Gas Markets
Oil prices sank on Friday, lowest close since Sep 8, on the back of US jobs report showing the economy added less jobs than expected in September, President Donald Trump testing positive for COVID-19 and mounting concerns over fuel demand recovery as the number of coronavirus infections continue to rise worldwide including major economies like the US, the UK, Germany and France
Brent crude on the Intercontinental Exchange traded 3.9% down on Friday, closing at $39.12 a barrel. Today it is trading lower up at $40.12
US WTI crude traded 4.02% down on Friday, settling at $37.01 a barrel. Today it is trading up at $38.01
Natural Gas futures was down 0.45% on Wednesday, closing at $2.660 per mmbtu. Today it is trading up at $2.777
On MCX, India’s Crude oil futures sank nearly 3.5% on Friday, closing at 2837
India’s Natural gas futures dropped 2.09% on the day, to close at 182
Gold & Silver Markets
Globally, gold prices steadied in early trade on Thursday as a softer dollar and progress on another US coronavirus relief package countered pressure from an upbeat US private payrolls data
US gold futures were down 0.23% at $1,890 per ounce on Thursday. Today, it is trading at $1,894
Spot gold was steady at $1,884.67 per ounce
Silver futures rose 0.2 % to close at $23.25 per ounce on Thursday. Today, it is trading lower at $23.85
On MCX, 4 Dec Gold futures were up 0.03% or 17 to 50,351 per 10 gram on Thursday
On MCX, 4 Dec Silver futures gained 0.40% or 241 to 60,160 per kg on Thursday
India – NCDEX Agridex
Agricultural futures index tracking the performance of the 10 liquid commodities, was up 1.00% trading at 1,160.40 ; led by gains in Guar seed and Soy Bean on Thursday
Currency Markets
US dollar strengthened on Wednesday’s trading session, with currency index gaining 0.09% against its G-10 peers, to settle at 93.81
Euro/USD levels fell 0.23% on Friday, closing at 1.1716, with Euro weakening
The Japanese yen strengthened by 0.18% on Friday versus the greenback at 105.31 per dollar
Sterling traded at $1.2935, up 0.37% on Friday, with sterling strengthening versus dollar
USD/INR opened at 73.1930 and gained 15 cents on Friday, to settle below the 75-per USD mark at 73.3460
Offshore Chinese yuan, CNH/USD, stands at 0.1476, down 0.02% with dollar strengthening marginally to CNH
Bond Markets
Yields on the benchmark 10-year Treasury note traded optimistically at 0.692 on Friday, up 1.21% on the day
The 30-year bond yield traded 1.40% up at 1.481 on Friday
India 10 Year bond yield stood at 6.073, rising 1.28% from 5.996, on Friday
Germany’s 10-year yield was flat at -0.54%
Britain’s 10-year yield climbed one basis points to 0.24%
New Zealand’s 10-year yield dipped two basis points to 0.48%
Japan’s 10-year yield climbed 1 basis points to 0.01%
Singapore’s 10-year yield fell 2 basis points to 0.8%
South Korea’s 10-years yield was flat at 1.41%
Fund Flows on 01.10.2020 (source NSE)
FII Net Sell Rs 1,632.25 Cr in Cash Market
DII Net Buy Rs 259.46 Cr in Cash Market
