Index Trend & Conditions

• Major Resistance created at 11,970—12,100 area for Nifty50

• For Wednesday, Oct 28, Support at 11,650—11,680 area with Resistance at 11,800  11,930 and 11,970 for Nifty50

• Trends on SGX Nifty indicate a negative outlook for Nifty50 in India with a 48 points loss. The Nifty futures were trading at 11,839 on the Singaporean Exchange at 08:00 IST

• Dow Jones, S&P500 and Nasdaq futures trading red on the day after opening gap-down, a negative outlook of Asia-Pacific early morning market, a small bullish candle on Tuesday’s Nifty50 daily scale and a strengthening dollar on the day indicate a gap-down start with a negative bias for Indian benchmark indices

• The current mood in the market is bracing and non-committal

India Markets

Nifty50 OPENHIGHLOWCLOSE
Tuesday11,80711,89911,72311,889

Nifty50 added 121 points or 1.03% on Tuesday to close at 11,889

The index formed a bullish candle on the daily chart after breaking the immediate resistance at 11,800

Nifty is on the verge of forming an ascending triangle on the daily scale

On the weekly chart, Nifty continues to move in a closed range of 12,000 and 11,777

Both Private Bank and Financial Services stocks were at the vanguard of the rally while IT and PSU Bank stocks faltered the most

On the up side, crucial level or resistance is seen at 11,930 and 11,970for Wednesday

While, on the downside, support is seen at 11,765 for Wednesday

The BSE Sensex index advanced 380 points or 0.94% at 40,552 on Tuesday

Bank Nifty advanced towards 24,800 level during the day, to close at 24,769

Bank Nifty has witnessed a strong resistance level at 24,581 last week

India VIX dropped -2.79 from 22.83 to 22.19 levels

Broader market indices closed higher on the day. The Midcap index outperformed its headline peers with a rise of 207 points or 1.22% while the smallcap index gained 10 points or 0.20%

The overnight call money rate weighted average stood at 3.21% according to RBI data. It moved in a range of 1.80 – 3.50% as on Oct 26

Analysts suspect the Tuesday’s rally to be fuelled by hopes of massive foreign investors’ money coming to India after MSCI revises its emerging market centric indices in November

Morgan Stanley projected over $2.5 billion worth of investors’ money may be en route to India

MSCI sees Kotak Mahindra Bank, Ipca Labs and PI Industries among others to be included in the indices

Central bank’s October policy meeting minutes indicated reviving growth is a bigger priority for the newly appointed monetary policy committee than achieving an inflation target

Americas

Wall Street traded mixed on Tuesday following steep declines in the previous session, as new coronavirus waves in the US and Europe intensified

According to data from the Covid Tracking Project, hospitalizations rose by at least 5% in 36 US states over the past seven days

White House economic adviser Larry Kudlow said Monday that negotiations have slowed, though House Speaker Nancy Pelosi remained hopeful an agreement can be reached before the November election

The Dow Jones declined 222 points or -0.8% to 27,463

The S&P 500 lost 10 points or -0.3% to 3391

The Nasdaq gained 72 points or 0.6% to 11,431

The Nasdaq gained 72 points or 0.6% to 11,431

Canada’s S&P/TSX Composite Index lost 59 points or -0.36% to 16,020

Today in derivatives market, Dow Jones and S&P500 futures have opened gap-down dropping -0.55% each while Nasdaq 100 futures lost -0.46%

New orders for US manufactured durable goods surged 1.9% MoM in September, well above a 0.4% rise in August and market expectations of 0.5%

On the corporate side, shares of online retailers Shopify and Amazon outperformed as investors looked ahead of further tightening of social mobility across major economies

Zoom and Microsoft also led gains

Asia-Pacific Markets

Major stock markets in Asia traded lower Tuesday on renewed COVID-19 fears in the US and across Europe

Traders were also cautious after White House economic adviser Larry Kudlow saying that stimulus talks have slowed

The Nikkei 225 dropped 94 points or -0.40% to 23,394 in early Wednesday trade

Topix 500 dropped 7 points or -0.53% to 1,242 in early Wednesday trade

South Korea’s Kospi dropped 3 points or -0.13% in morning trade at 2,328

In Hong Kong, the Hang Seng Index dropped 145 points or -0.57% to 24,642 in early Wednesday trade

China’s CSI 300 Index stayed flat at 4,699 in early Wednesday trade

Hang Seng China Enterprises Index lost 70 points or -0.72% at 9,934 in early Wednesday trade

Shanghai Composite Index lost 13 points or -0.39% at 3,241 in early Wednesday trade

Australia’s S&P/ASX 200 added 2 points or 0.03% to 6,053 in early trade, near its 200-day EMA

Singapore’s Straits Times Index dropped 14 points or -0.57% to 2,498

Overall, MSCI’s broadest index of Asia-Pacific shares outside Japan, is up 0.19%

South Korea’s GDP rebounded 1.9% QoQ in September Quarter after shrinking -3.2% in the previous June Quarter, recovering from its sharpest contraction in more than a decade

Profits at China’s industrial firms rose for a 5th-straight month in September, while remaining negative over the first 9-months of the year

Mazda Motor Corp dropped more than -3.8%, the most on the Nikkei, and the second biggest decliner was Isetan Nippon Sheet Glass Co Ltd, down -3.1% while CyberAgent Inc rose 2.3%, the most on the index

EU Markets

European equities fell deeper into negative territory on Tuesday, as investors monitor earnings reports and remain cautious amid rising coronavirus infections and increasing opposition to tougher restrictions

The pan-European Stoxx 600 index dropped -0.20% at 353 on Tuesday

Stoxx 50 fell -0.52% to close at 3,088 on Tuesday

Germany’s DAX30 dropped 32 points or -0.27% at 12,144 on Tuesday

London’s FTSE 100 dropped 15 points or -0.24% to close at 5,778 on Tuesday

France’s CAC40 dropped 50 points, or -1.03% at 4,766

Denmark’s OMX Copenhagen 20 Index added 3 points or 0.22% at 1,358

Luxembourg’s LuxX Index dropped -0.91% at 1,074

Sweden’s OMX Stockholm 30 Index dropped -0.30% at 1,769

Italy’s FTSE MIB Index dropped 76 points or -0.40% at 18,869

French Interior Minister Darmanin said ahead of a cabinet meeting to discuss the pandemic that the country should get ready for “difficult decisions” on new measures to tackle the resurgence of cases

Lack of progress on a Brexit trade deal and on a US stimulus package continued to weigh on sentiment

On the corporate front in Germany, better-than-expected quarterly results were released by Novartis, HSBC Holdings, Santander, BP, Capgemini and Covestro

In France, shares of consulting and IT services provider Capgemini jumped after it confirmed its full-year targets

Oil & Natural Gas Markets (+ palm oil futures)

WTI crude futures were up nearly 0.99% to trade around $38.96 a barrel on Tuesday

Brent crude prices hovered below $41 a barrel on Tuesday

Natural gas hovered around $3.003/MMBtu on Tuesday

Crude palm oil futures rose to above RM 2,600 per tonne in the last week of October, as demand from China and India, the world’s two biggest consumers of palm oil, has been recovering quickly

Malaysia’s exports of palm oil to China were up 69% in September when compared to March and those to India climbed 42%

WTI Crude is trading lower at $38.78 per barrel in early Wednesday trade

Brent Crude is trading lower at $40.52 per barrel in early Wednesday trade

Natural Gas futures added 8.39% at $3.306 per mmbtu in early Wednesday trade

On MCX-India, Crude oil futures added 3.09% to 2,934 in early Wednesday trade

On MCX-India, Natural gas futures rose to 226 in early Wednesday trade

On MCX-India, Palm Oil futures added to 817 in early Wednesday trade

Gold & Silver Markets (+ copper futures)

Gold closed up 0.35% at $1,908 an ounce on Tuesday

Silver hovered around $24.3 an ounce on Tuesday

Gold’s long-term outlook remains bullish amid expectations of a prolonged period of ultra-low interest rates coupled with the uncertainty surrounding the global economic recovery and US elections

US Gold futures (Comex) weakened to $1,907.50 an ounce in early Wednesday trade

US Spot Gold strengthened to $1,906.48 an ounce in early Wednesday trade

Silver futures (Comex) weakened to $24.41 an ounce in early Wednesday trade

Copper futures (Comex) weakened to $308.30 per pound in early Wednesday trade

In India, Spot Gold strengthened to INR 50,226 per 10 grams in early Wednesday trade

India – NCDEX Agridex

Agricultural futures index tracking the performance of the 10 liquid commodities, was up 0.40% trading at 1,207 ; with major gains in Cotton Seed, Guar Seed and Chana futures on Tuesday

Currency Markets

The dollar index traded lower below 92.9 on Tuesday, after touching a one-week high of 93.1369 earlier in the session

Upbeat earnings for US companies including 3M and Caterpillar improved investors’ risk appetite

Worldwide spike in coronavirus infections, with the US, Russia and France setting daily records for virus cases and fading hopes of a new stimulus bill before the presidential election next week continued to pressure the dollar

USD weakened on Tuesday, with currency index dropping -0.17% against its G-10 peers, at 92.884

INR strengthened 0.18% with USD-INR at 73.7162

JPY strengthened 0.24% with USD-JPY at 104.5900

CNY strengthened 0.09% with USD-CNY at 6.7060

EUR strengthened 0.19% with EUR-USD at 1.1832

GBP strengthened 0.16% with GBP-USD at 1.3045

SEK strengthened 0.39% with USD-SEK at 8.7111

Bond Markets

Americas : 10-Year Govt Bond Yields

United States  :  Down 2 basis points at 0.78%    
Canada  :  Down 1 basis point at 0.61%

Europe, Middle East & Africa : 10-Year Govt Bond Yields

Germany  :  Down 1 basis point at -0.60%
United Kingdom  :  Down 1 basis point at 0.26%
France  :  Down 2 basis points at -0.32%
Netherlands  : Down 1 basis point at -0.49%

Asia Pacific : 10-Year Govt Bond Yields

India  :  Up 1 basis point at 5.85%
Japan  :  Flat at 0.02%
Australia : Flat at 0.80%
Hong Kong : Down 2 basis points at 0.33%
Singapore : Up 1 basis point at 0.83%      
South Korea : Up 2 basis point at 1.50%

Fund Flows on NSE, BSE and MSEI – Oct 27 2020 (source NSE)

FII Net Buy Rs 3,514.89 Crore in Cash Market

DII Net Sell Rs (1,570.80) Crore in Cash Market

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