open on a flat to negative note
Asian indices opened flat as nearness to year end saw volumes dry up as
markets await 2017. Strength in US$, rise in bond yields & weakness
in emerging markets were the theme of the last 2 months of 2016. Gold
prices continued to struggle as coupled with slowdown in India the
strength in the US$ is another negative going forward into 2017.
The markets are not moving fast in any direction but India’s economy
seems to be well under control to race ahead. For the first time in
nearly 150 years, India surpassed Britain as far as the size of the
economy is concerned. India is now the fifth largest economy with
US$2.30 trillion and the ones ahead are USA, China, Japan and Germany.
The fall in the pound coupled with Brexit issues enabled India to
overtake the UK GDP much earlier. For now, the Indian rupee continues to
see weakness. The outlook is a tame start. US indices notched up some
gains and Asian markets are mixed. Investors expect some upbeat view on
the Japanese economy today. Tata group stocks will remain in focus
after Cyrus Mistry announced his resignation from the boards of Tata
Motors, Indian Hotels and four other companies. Bank of Japan, on
expected lines, has kept policy rates unchanged; says economy will
witness moderate growth and will persist with asset purchasing till
Japan reaches 2 pc inflation.
When the Asian indices opened today, the markets were volatile as Bank
of Japan was yet to announce the monetary policy details. Japan's Nikkei
225 opened at 19,367, Singapore's Straits Times opened at 2,917,
China's Shanghai Composite started at 3,115 and Hong Kong's Hang Seng
opened at 21,767. At the time of filing this report, all indices were
trading in red except for Straits Times..
Benchmark indices of the US ended on a higher side on Monday although
the volumes involved were low, also the market investors bought into
underperfoming sectors. With the ongoing political tensions between the
US and China, the markets were not heavily impacted as the indices ended
the trading day close to their respective all-time highs. However,
during the early trading hours, the US indices were influenced and were
under pressure post the assassination of the Russian ambassador to
Turkey. Post Russian officials termed it as a terrorist attack, crude
oil prices reversed earlier losses and ended higher. Bank stocks were
the key gainers here. Nasdaq Composite ended at 5457 up 0.37%, S&P
500 ended at 2262 up 0.20% and Dow Jones Industrial Average closed at
19883 up 0.20%.
Foreign institutional investors (FIIs) net bought index futures worth
Rs 3.27 billion and index options worth Rs 1.15 billion on the NSE. FIIs
net sold stock futures worth Rs 6.63 billion. FIIs net sold Indian
shares worth Rs 5.36 billion on the BSE, NSE, and the Metropolitan Stock
Exchange combined. Domestic institutional investors (DIIs) net bought
shares worth Rs 5.56 billion.
In respect to the performance of
Indian American Deposit Receipts (ADRs), it was again a non-performing
day for most of the Indian ADRs. Wipro was the only ADR which ended on a
postive note up 0.2%, while HDFC Bank, Vedanta were the worst hit down
over 1%, and others including Dr Reddy's, ICICI Bank, Infosys, Sify,
Tata Motors also ended on a low note.
SGX Nifty 50 December futures was down tracking weak Asian markets, it was at 8125, down 25 points from Monday.
Nifty continues to drift lower on low volumes as foreign flows remain
muted with fag end selling seeing Nifty drift closer to 8100.The
sentiment being low small rhetoric on effects of demonetization &
visible fallout has been impacting sectors with higher impact costs
under selling pressure. For today expect IT stocks to lead gains along
with energy & gas while consumption, financials & infra remain
under pressure.
Nifty now finds support around 8050 with 8150 acting as resistance.
Bank Nifty finds support around 18000 while 18500 acts as resistance.
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