If Nifty closes below 8,700, bearishness will continue
We had mentioned in Tuesday’s closing report that the NSE’s CNX Nifty may move sideways and that if it does not go below 8,720, it is likely to move up to 8,800. Wednesday was the fifth consecutive session for the index to make a lower low. Today the benchmark witnessed a volatile range bound session between 8,720 and 8,780 but by the end of the session it broke the lower range and hit the day’s low and closed near to it.
The S&P BSE Sensex opened at 29,130 while Nifty opened at 8,789. Sensex moved in the range of 28,825 and 29,134 while Nifty moved between 8,704 and 8,793. Sensex closed at 28,883 (down 117 points or 0.40%) while Nifty closed at 8,724 (down 33 points or 0.38%). NSE recorded a 107.46 crore shares. India VIX rose 1.22% to close at 20.0500.
Prime Minister Narendra Modi on Tuesday said that his priority was for India to establish global benchmarks in areas such as governance, transparency and taxation. Among other things, he also mentioned that the priority of the government is economic growth and to create jobs.
The HSBC India Services PMI Business Activity Index edged up to 52.4 in January 2015, from 51.1 in December 2014. According to survey responses, the latest increase in the services activity reflected further growth of new business during the month.
"We still have concerns about inflation. Given the deflationary environment elsewhere, it's actually easier for us because we are not fighting inflation in an environment where inflation is picking up elsewhere," Reserve Bank of India (RBI) governor Dr Raghuram Rajan said in a conference call with analysts.
India's securitisation market can provide funds needed for financing infrastructure, housing and urbanisation projects as the country's economy grows, rating agency Moody's Investors Service has said.
The oil marketing companies on Tuesday slashed petrol prices by Rs2.42 a litre and diesel price by Rs2.25 a litre in line with the decline in global oil prices.
Coming back to Indian stock markets, Kaveri Seed (10.19%) was the top gainer in ‘A’ group on the BSE. The stock gained inspite of posting weak results. Its board of directors has declared for payment of second interim dividend of 125% i.e., Rs2.50 per share.
Alembic Pharma (11.08%) was the top loser of the group. Today it reported an improved December 2014 quarter result over the year ago period.
Hindalco (3.89%) was the top gainer in the Sensex 30 pack while Axis Bank (4.64%) continued to be the top loser of the pack.
US indices closed Tuesday in the green.
January US car sales topped analysts' expectations, as low gasoline prices and easy credit terms helped fuel sales of utility vehicles and big pickups.
Except for Shanghai Composite (0.96%) and SET Composite index of Thailand (0.17%) all the other Asian indices closed in the green. Nikkei 225 (1.98%) was the top gainer.
The HSBC Hong Kong Purchasing Managers Index (PMI) contracted in January, a signal of the city's deteriorating output at the start of 2015 amid China's economic slowdown. HSBC said Wednesday that January's manufacturing PMI fell to 49.4 from 50.3 in December. The HSBC China services purchasing managers index fell to a six-month low at 51.8 in January from 53.4 in December.
European indices were trading lower while US Futures were trading marginally in the red.
On Tuesday, Greece's Finance Minister Yanis Varoufakis reportedly said that Athens was working on a road map to lessen the burden of his country's hefty debt pile, and he hoped to have an agreement with Greece's creditors by the beginning of June. That is a sign Greece's new government was moving closer in its negotiations with its creditors to easing the terms on the country's 240 billion-euro bailout in 2012.