The recent upmove in Nifty seems mature. However, the index may take a few more sessions to head lower
We had mentioned in our Wednesday closing report that the NSE's CNX Nifty will be headed lower if it closes below 7,850. On Thursday the benchmark barely managed to keep itself above this level and hit a low of 7,856. The market opened marginally higher and managed to move higher in the morning session. However, the upward move could be sustained only upto 10:42am after which the indices started moving lower.
S&P BSE Sensex opened at 26,323 and moved up to 26,465 while the Nifty opened at 7,875 and surged to 7,920. Soon the indices gave up all their intraday gains and edged lower. In less than an hour of trading in the negative, the indices hit a low of 26,263 and 7,856. Recovering from the red, the indices tried moving higher but after trading in a range, they managed to close a little above Wednesday’s close. Sensex closed at 26,360 (up 46 points or 0.17%), while Nifty closed at 7,891 (up 16 points or 0.20%). NSE recorded a volume of 83.52 crore shares. India VIX rose 0.53% to close at 13.7325.
There have been reports that some progress was made on the proposed goods and services tax (GST), after the empowered committee of state finance ministers decided on Wednesday, that the common threshold for levy of GST would be kept at Rs10 lakh in general category states and Rs5 lakh in special category states.
Oil Secretary Saurabh Chandra said that the under-recoveries of oil companies will come down substantially in the current fiscal, ending 31 March 2015, on account of better pricing and stable global crude prices.
Union Bank of India, Indian Bank, Bank of India, Federal Bank and PNB were among the top 10 gainers in the ‘A’ group on the BSE. All the bank stocks in the Sensex 30 pack, State Bank of India, HDFC Bank, Axis Bank and ICICI Bank were among the gainers. Finance Minister Arun Jaitley on Thursday said that the government was working to tighten up risk management in the banking sector.
NTPC (1.86%) was the top loser in the ‘A’ group among the Sensex 30 stocks. There was news that NTPC is exiting its non-core assetsn comprising 1,611 megawatt of hydel power projects, it will be selling them to public sector units including National Hydroelectric Power Corp and others that possess core competence of executing hydro power projects.
Titan Company (6.04%) was among the top four gainers in the ‘A’ group on the BSE.
Today the stock hit its 52-week high after Morgan Stanley upgraded the stock to 'overweight' from 'underweight' earlier.
Bhushan Steel continued to hit a new 52-week low and was the top loser (4.97%) in the ‘A’ group on the BSE. The stock has fallen 67% since 1st August (Rs394.85) before the news of the company's involvement in the Syndicate Bank bribery scam surfaced.
Amara Raja Batteries, which hit its 52-week high on Tuesday, was among the top two losers (4.38%) in the ‘A’ group on the BSE.
US indices closed mostly higher on Wednesday. The minutes from the Federal Reserve's July meeting showed that the central bank is in no rush to raise interest rates.
Asian indices showed a mixed performance. Nikkei 225 (0.85%) was the top gainer, while Seoul Composite (1.38%) was the top loser.
The HSBC/Markit Flash China Manufacturing Purchasing Managers' Index (PMI) fell to 50.3 in August from July's 18-month high of 51.7, missing forecasts.
European indices were trading in the green. US Futures too were trading marginally higher.
Data released today showed that German services and manufacturing activity slowed in August. The preliminary reading of a Purchasing Managers Index for the two industries fell to 54.9 in August from 55.7 in July, London-based Markit Economics said. A reading above 50 indicates expansion.
French manufacturing activity contracted for a fourth month in August, signaling that the euro area's second-largest economy is unlikely to return to growth after stagnating in the first half. A Purchasing Managers Index for the manufacturing industry fell to 46.5 in August from 47.8 in July, London-based Markit Economics said today, 21 August 2014. That's the lowest level in more than a year. A composite gauge of both manufacturing and services activity rose to 50 in August, the mark that divides expansion from contraction, from 49.4 in July.