Index Trend & Conditions
Major Resistance at 11,900 for Nifty50
For Wednesday, Oct 7, Support at 11,535 11,600 and 11,647 with Resistance at 11,900 for Nifty50
Trends on SGX Nifty indicate a steady with a dull outlook for Nifty50 in India with a 10 points gain. The Nifty futures were trading at 11,685 on the Singaporean Exchange at 09:00 IST
Global Premise
The WTO says 2020 global merchandise trade will contract 9.2%, before rebounding next year
In Singapore, visitor numbers at Changi, once Asia’s third-busiest airport for international flights, has slumped to the lowest since it was built in 1981. Singapore has pledged about S$100 billion ($74 billion) in stimulus measures to fight the effects of the pandemic, including wage subsidies and digital-transformation initiatives
In Canada, trade dropped with the rest of the world in August on lower car exports. Merchandise exports fell 1% in August, after jumping 42% between April and July, Statistics Canada said Tuesday in Ottawa. Imports decreased 1.2%. That leaves total trade at about 94% of pre-pandemic levels, a deterioration from July when it had rebounded to about 96%. The trade deficit narrowed slightly to C$2.45 billion ($1.85 billion) in August, from a revised C$2.53 billion in July. Economists had forecast a deficit of C$2.05 billion
US, in recent weeks, Fed officials have stressed that the recovery is highly dependent on the nation’s ability to better contain infections, and that further fiscal stimulus is likely needed to support jobs and incomes
US job openings fell in August for first time in four months
In the oil markets, Premier Oil Plc will be swallowed by Chrysaor Holdings Ltd. in a reverse takeover, marking the end of the road for one of the oldest independent oil explorers
US oil pipeline operators are slashing fees to encourage customers in Texas to keep using their networks to ship barrels to the Gulf Coast as the pandemic wreaks havoc on profits
US trade deficit widened in August to the largest since 2006 as the nation imported a record amount of consumer goods amid a pickup in demand ahead of the holiday-shopping season. The overall gap in trade in goods and services expanded to $67.1 billion in August from a revised $63.4 billion in July. Total imports increased 3.2% to $239 billion, while exports rose 2.2% from the prior month to $171.9 billion. The nation’s surplus in services shrank to the lowest since 2012. Imports of services, ranging from insurance and financial services to construction and travel, rose to almost $36.1 billion
Roy Niederhoffer, fund manager who is famous for turning around the financial fortunes of the New York City Opera in 2015, fears the end of the bond bull run. He sees a new market corner that’s potentially ripe for trend-following quants – Foreign exchange. His firm oversees a fund of $333 million, which seeks to exploit behavioral quirks in markets, trades short-term momentum and mean-reversion strategies. He added that while the volatility of the asset class (forex) has been muted over the years, all that may be about to change as a by-product of unprecedented monetary intervention in debt markets
In Europe, two of the European Central Bank’s top officials signaled the need for extra monetary and fiscal stimulus as the euro zone struggles to sustain its economic recovery from the coronavirus pandemic
In France, the country’s statistics agency, Insee downgraded its growth forecast to zero from 1%
Restrictions are creeping back in France, with the government ordering bars in Paris to close and imposing new rules on restaurants. On Saturday, the country reported a record rise in cases of nearly 17,000 in 24 hours
The euro extended losses after the report, which heightens concern that Europe’s recovery has run out of steam. Investors and economists expect the European Central Bank to expand its pandemic bond-buying program later this year
India Markets
| Nifty50 on Monday | Open 11,603 | High 11,680 | Low 11,564 | Close 11,662 |
Nifty50 on Tuesday advanced 159.05 points or 1.38% to 11,662
Banks and financials were at the vanguard of the rally while metals and FMCG faltered
The S&P BSE Sensex added more than 600 points or 1.54% to close at 39,574 on Tuesday
BSE Realty, Bankex, Auto, Consumer Discretionary and Industrials also gained between 0.75% and 2.50%
On the up side, crucial level or resistance is seen at 11,900 for Wednesday and a breach of this level will bring further upside to the index
While, on the downside, support is seen at three points 11,535 11,600 and 11,647 for Wednesday
Nifty50 had formed a small head-and-shoulder pattern, but closed above the right shoulder today i.e. above the critical resistance level of 11,600 making this a positive development. Tuesday’s upside gap was above a key resistance area, which made it a breakaway gap. Both the MACD and directional movement index are in the buy mode
India Volatility Index slipped 0.33% on Wednesday from 19.70 to 19.64
The overnight call money rate weighted average stood at 3.42% according to RBI data. It moved in a range of 1.80 – 4.00% as on Oct 05
Americas
Wall Street closed sharply lower on Tuesday, reversing earlier gains, after President Trump told his team to stop talks with Democrats on a fresh round stimulus until after the November 3rd election
The S&P500 fell 1.4% on Tuesday to 3,361
The Nasdaq Composite Index fell 1.57% on Tuesday to 11,154
The Dow Jones Industrial Average sank 1.34% on Tuesday to 27,772
Russel 1000 Index sank 1.31% on the day, touching 1,877
Canada’s S&P/TSX Composite Index traded 0.03% higher to 16,416 on Tuesday
Today in derivatives market, Dow futures fell 60 points, S&P 500 futures and Nasdaq 100 futures fell 0.3% and 0.2%, respectively
Goldman Sachs Group Inc. boosted the size of a new credit fund to $14 billion in what is shaping up to be one of the largest debut investment vehicles ever raised. The Goldman credit fund will provide a boost to the bank’s goal of raising $100 billion for investing. The fund has already started investing, most notably pouring $1.2 billion into American Airlines Group Inc
Earlier on the day, Fed Chair Powell called for additional fiscal and monetary stimulus to help the US economy amid the pandemic crisis, saying that too little support would lead to a weak recovery, while the risks of overdoing it seems to be smaller
Asia-Pacific Markets
Shares fell in Asia on Wednesday, tracking a retreat on Wall Street as rising coronavirus cases in the US and Europe dampened hopes of a faster economic recovery
China markets remain closed for a holiday
In Japan, the Nikkei 225 dipped 0.2% in early morning trade to trade at 23,395 while the Topix 500 shed 0.1% and is trading at 1,269
South Korea’s Kospi added 0.16% in morning trade at 2,369
Hong Kong’s Hang Seng Index gained points in morning trade, up 0.54% to trade at 24,110
Meanwhile, Australia’s S&P/ASX 200 rose 0.8% in early trade
Singapore’s Straits Times Index fell 0.19% to 2,524
Overall, MSCI’s broadest index of Asia-Pacific shares outside Japan, rose 0.80%
EU Markets
European equities recovered from early losses in a volatile session on Tuesday, as investors digested ECB President Christine Lagarde’s dovish comments and mixed data from Germany and the Eurozone
The pan-European Stoxx 600 index gained 0.1% to 365, the highest in more than two weeks
Stoxx 50 also advanced 0.41% closing at 3,233
Germany’s DAX30 gained 0.61% to 12,906 on Tuesday
London’s FTSE 100 added 0.12% to close at 5,949 on Tuesday
France’s CAC40 added 24 points, or 0.48% to end at 4,896 on Tuesday
OMX Copenhagen 20 Index fell by 0.78% to 1374
ECB President Christine Lagarde said that the central bank was ready to unleash further stimulus to support the bloc’s economy, including slashing interest rates deeper into negative territory
On the economic data front, a stronger-than-expected rise in German factory orders during August, coupled with last week’s retail sales and unemployment figures, raised expectations of a quicker recovery in Europe’s largest economy
At the same time, a PMI survey showed the Eurozone’s construction sector contracted in September for a seventh consecutive mont
Lufthansa’s CEO Spohr said that the airline is still burning cash at a rate of €500 million per month and is far from breaking even
Oil & Natural Gas Markets
Oil pulled back from a two-week high after Federal Reserve Chair Jerome Powell warned of a weak US economic recovery without sufficient government aid
Oil prices also plunged after US President Donald Trump canceled talks over new fiscal stimulus measures
West Texas Intermediate crude for November delivery climbed 1.09% to $39.77 a barrel. Today it is trading up at $39.82
Hurricane Delta barreled toward the energy-producing Gulf of Mexico region, forcing oil producers to shut platforms
Brent for December settlement gained 40 cents to $41.47 a barrel on Tuesday. Today it is trading at $41.92
Natural Gas futures fell 2.44% on Tuesday to $2.803 per mmbtu. Today it is trading up at $2.839
On MCX, India’s Crude oil futures surged 2.52% on Tuesday to 2972
India’s Natural gas futures fell 3.74% on the day, to close at 188
Gold & Silver Markets
With dollar index easing, gold prices have recovered in recent days
Current downside in gold prices is likely to improve demand for physical gold in India. Prices are moving in a range which is very good for buying physical gold
US gold futures weakened 1.79% to $1,878 an ounce on Tuesday. Today, it is trading at $1,882
Silver fell on close to $23.05 an ounce on Tuesday
On MCX, gold futures were flat at Rs 50,620 per 10 grams
India – NCDEX Agridex
Agricultural futures index tracking the performance of the 10 liquid commodities, was down 0.38% trading at 1,150.60 ; gains in Soy Bean on Tuesday
Currency Markets
US dollar surged on Tuesday’s trading session, with currency index rising 0.43% against its G-10 peers, to settle at 93.85
USD/Canadian dollar touched $1.3318 gaining 0.41% with USD strengthening
Euro/USD remained unchanged on Tuesday, closing at 1.1782, with Euro strengthening, after data showed the Eurozone retail sales rose more than expected in August
The Japanese yen strengthened 0.1% on Tuesday versus the greenback at 105.61 per dollar
British pound dipped 0.2% to $1.2955 on Tuesday
The rupee depreciated further to close at 73.39 against the US dollar on Tuesday due to dollar buying by banks
Offshore Chinese yuan, CNH/USD, stands at 0.1478, falling0.4% on Tuesday with dollar strengthening to CNH
Bond Markets
The yield on 10-year US Treasuries dipped five basis points to 0.73%
The yield on 30-year US Treasuries fell six basis points to 1.535% on Tuesday
India 10 Year bond yield stood at 6.028
Germany’s 10-year yield advanced less than one basis point to -0.51%
Fund Flows on NSE, BSE and MSEI – Oct 06, 2020 (source NSE)
FII Net Buy Rs 1,101.76 Cr in Cash Market
DII Net Sell Rs 934.84 Cr in Cash Market
