Nifty will make attempts to make new highs but will come under selling pressure
We had mentioned in Tuesday’s closing report that NSE's CNX Nifty can hit 8,130 on Wednesday and that the market looks stretched and is due for a pullback soon. On Wednesday the benchmark crossed this level twice, marginally. It managed to stay above it for almost half an hour but soon gave up gains and closed near to the day’s opening.
BSE S&P Sensex opened at 27,128 while Nifty opened at 8,111. Sensex moved in the range of 27,067 and 27,226 and closed at 27,140 (up 121 points or 0.45%), seventh day of closing at a new all-time high. Nifty moved between 8,092 and 8,142 and closed at 8,115 (up 32 points or 0.39%). The NSE recorded a volume of 97.70 crore shares. India VIX fell 0.41% to close at 13.3925.
Among the other indices on the NSE, the top five gainers were IT (2.41%), Realty (2.16%), Metal (1.00%), Midcap (0.98%) and Infra (0.78%) while the top five losers were FMCG (0.67%), PSU Bank (0.43%), PSE (0.27%), Finance (0.23%) and Dividend Opportunities (0.19%).
Of the 50 stocks on the Nifty, 23 ended in the green. The top five gainers were Coal India (3.96%), Infosys (3.22%), Bharti Airtel (3.17%), Wipro (2.75%) and TCS (2.56%). The top five losers were Gail (2.25%), ONGC (1.72%), IDFC (1.57%), Bhel (1.50%), Bajaj Auto (1.47%).
Of the 1,618 companies on the NSE, 760 companies closed in the green, 792 companies closed in the red while 66 companies closed flat.
The latest survey released by Markit Economics showed that growth in India's service sector activity slowed in August 2014. Adjusted for seasonal influences, the headline HSBC India Services Business Activity Index posted 50.6 in August, down from 52.2 in July.
India is among the worst- ranked countries when it comes to taxation and inflation burden on economy, as also in terms of the negative impact of crime, terrorism and health hazards on business environment, a WEF report said today. Out of 144 countries analysed by the World Economic Forum, India ranks 133rd in terms of inflation, 130th for taxes and 131st for starting a business.
Oberoi Realty (15.24%) hit its 52-week high today and was the top gainer in ‘A’ group on the BSE. Eicher Motors (8.46%) too hit its 52-week high today and was among the top two gainers in the ‘A’ group on the BSE.
JSW Steel hit its 52-week high on Tuesday. It corrected today giving up gains and appeared among the top three losers (2.44%) in the ‘A’ group on the BSE.
Coal India (3.40%) was among top two gainers in the Sensex 30 pack. The Coal Ministry has sought comments from various ministries, including finance, on the draft Cabinet note for implementation of performance related pay of Coal India employees, aimed at removing anomalies in salaries and wages of nearly 19,000 CIL officers. In March, Coal Mines Officers Association of India had gone on a day’s strike to press for implementation of performance-related pay and the new pension scheme. They called off their strike on the second day after the management assured them that it would push for early placement of their demand for performance-linked pay before the Cabinet. The strike hit the company’s output by 4 lakh tonnes. Coal India has a workforce of 3.49 lakh employees.
ONGC (1.48%) was among the top three losers in the Sensex 30 stock. With the intention of getting higher price for natural gas, it said that it needs $6-7.15 to break-even on gas it plans to produce from its most prolific KG basin block. In its submission to the four-member panel of secretaries working out a new gas pricing mechanism, it said in 2013-14 its cost of gas production, after including return on capital, came to $4.43 per million British thermal unit, higher than the current price of $4.2.
US indices had a mixed closing on Tuesday. The Institute for Supply Management said its US manufacturing activity index rose to 59 in August, the strongest since March 2011. July construction spending was at its highest level in over 5-1/2 years.
Separately, US construction spending staged a strong rebound in July, rising by the largest amount in more than two years. Construction spending rose 1.8% in July, the biggest one-month gain since May 2012, the Commerce Department reported Tuesday. It followed a 0.9% decline in June, the largest setback in a year.
Except for KLSE Composite (0.15%) and Seoul Composite (0.02%) all the other Asian indices closed in the positive. Hang Seng (2.30%) was the top gainer.
The HSBC China services Purchasing Managers' Index (PMI) rose to a 17-month high of 54.1 in August from 50 in July, HSBC Holdings PLC said today. The HSBC Composite Output Index posted at 52.8, up from 51.6 in July, and signalled a robust rise in activity levels. Furthermore, it was the strongest expansion of business activity in 17 months. China's official non-manufacturing activity slightly recovered in August, with the sector's purchasing managers' index (PMI) rebounding to 54.4 in August from 54.2 in July. European indices were trading in the green. US Futures too were trading higher.