Nifty will regain strength only on a close above 8,750
We had mentioned in Wednesday’s closing report that currently the move on the NSE’s CNX Nifty is not following any trend and further direction may be clear after the Union Budget while Bank Nifty was decidedly weak. The market opened Thursday in the positive, which was the only time when the benchmark moved in the green zone. Immediately after hitting the day’s high, the 50-share index moved lower and continued to move lower after each effort to revive. The benchmark hit a nine-day low (including today) and closed near to it. The much awaited Railway Budget was not welcomed by the investor community. Railway related stocks, which were much in demand before the Budget, gave up gains later in the day.
The S&P BSE Sensex opened at 29,052 while Nifty opened at 8,779. The benchmark hit a high at 29,069 and 8,786. Sensex hit a low at 28,694 and closed at 28,747 (down 261 points or 0.90%). Nifty hit a low at 8,669 and closed at 8,684 (down 83 points or 0.95%). Bank Nifty opened at 18,781 and moved from the high of 18,795 to the low of 18,490 and closed at 18,538 (down 195 points or 1.04%). NSE recorded a volume of 100.47 crore shares. India VIX fell 0.94% to close at 20.5800. The higher volume on the NSE was due to the expiry of February futures and options.
Railway Minister Suresh Prabhu said the railways will invest Rs8.5 lakh crore over the next five years, there will be no increase in passenger fares and railways is targeting operating ratio of 88.5% for FY 2016.
Standard & Poor's Ratings Services on Thursday said that it was lowering its economic growth forecasts for China and Japan, while raising the outlook for India. For China, S&P now sees 2015 gross domestic product rising 6.9%, down from a previous projection of 7.1% growth. For 2016, it cut China's GDP expansion to 6.6% from 6.7%. For Japan, it trimmed the 2015 forecast to just 0.7% growth from 1.3%, while for next year, it sees 1.3% growth, down from 2.1%. S&P raised its India GDP growth forecast to 7.9% from 6.2% for the year ending March 2016.
With a decline in gold imports, the Commerce Ministry has sought reduction in import duty on the yellow metal. The industry has sought reduction in customs duty on gold to 2% from 10% now.
India is likely to meet the central bank's inflation target of 6% by January 2016, while economic growth is expected to gradually pick up, Reserve Bank of India (RBI) Deputy Governor SS Mundra said today.
Coming back to Indian stock markets, NTPC (4.90%) was the top gainer in ‘A’ group on the BSE and also the Sensex 30 pack. NTPC informed that the Unit-Ill of 500 MW of Vallur Thermal Power Project of NTPC Tamil Nadu Energy Co, a JV of NTPC and TANGEDCO, is declared to be on commercial operation from February 26, 2015. With this the total commercial capacity of Vallur Thermal Power Project has become 1,500 MW and that of NTPC Group – 43,143 MW. Union Bank of India (4.63%) was the top loser in ‘A’ group on the BSE. Bhel (3.47%) was the top loser in the Sensex 30 stock.
On Wednesday, US indices closed flat. Federal Reserve Chairwoman Janet Yellen repeated in her second day of testimony to US lawmakers that normalisation of interest rates will begin when the Federal Open Market Committee is confident that inflation is on track to hit the central bank's inflation target of 2% growth.
In economic data, new homes in the US sold at a faster pace than forecast in January despite snow storms in the Northeast in the country, a sign of stabilisation in the housing industry, data released yesterday.
Except for Straits Times (0.43%) and Taiwan Weighted (0.80%) all the other Asian indices closed in the green. Shanghai Composite (2.15%) was the top gainer.
Singapore's industrial production swung to an expansion in January after two consecutive months of contraction. Manufacturing output rose 0.9% year-on-year in January, compared with a 1.9% decline in December, according to preliminary figures released by the Economic Development Board today.
European indices were trading higher. US Futures too were trading in the green.