Dear Trader…
Indian equity benchmarks trimmed most of the day's gains but managed to settle in the positive territory on Friday. Benchmarks made gap-up opening, as traders took encouragement with a report that the Income-tax department has collected around Rs 28 crore in taxes after about 1 lakh returns were filed by taxpayers under the newly introduced return filing form called ITR-U that was notified this year as part of the Budget 2022-23.
However, key gauges erased gains in the dying hour of trade but managed to close in green, taking support from Services Export Promotion Council (SEPC) said that implementation of the proposed India-UK free trade agreement will help to boost the country's services exports, particularly from legal, accounting and auditing sectors. Adding some more relief, a private report stated that the Indian software-as-a-services (SaaS) market is expected to grow multi-fold by 2025, accounting for almost 7 to 10 per cent of the global market from 2 to 4 per cent currently.
Nifty futures opened at 17677.30 points against the previous close of 17588.40 and opened at a low of 17602.05 points. Nifty Future closed with an average movement of 162.95 points and a rise of around 89.60 points and 17678.00 points...!!
On the NSE, the midcap 100 index will rise 0.55% and smallcap 100 index is closing rise 0.70%. Speaking of various sectoral indices, only Media, Realty, PVT Bank, FMCG and Pharma stocks were seen selling on the NSE, while all other sectoral indices closed higher.
At the start of intra-day trading, October gold opened at Rs.51636, fell from a high of Rs.51685 points to a low of Rs.51330 with a decline of 292 points, a trend of around Rs.51410 and September Silver opened at Rs.55450, fell from a high of Rs.55595 points to a low of Rs.55360, with a rise of 108 points, a trend of around Rs.55497.
Meanwhile, expressing optimism over India’s credit worthiness, S&P Global Ratings said India has built up buffers against cyclical difficulties and has ample foreign exchange reserves to withstand pressure on credit worthiness. S&P Sovereign & International Public Finance Ratings Director Andrew Wood said the country has a strong external balance sheet and limited external debt, making debt servicing not so expensive. He said ‘the country has built up buffers against cyclical difficulties like those, which we are experiencing right now’. He said the rating agency did not expect near-term pressures to have a serious impact on India's credit worthiness.
He also said ‘we are expecting a strong level of GDP growth of 7.3% this fiscal’, and added that the rupee exchange rate movement against the U.S. dollar had been moderate. The rupee has depreciated about 7% against the U.S. currency this year but has performed better than its emerging market peers. He said India had ‘ample buffer’ in its foreign exchange reserves and the forex kitty is expected to recover to $600 billion by the end of this year. Forex reserve stood at $570.74 billion as of August 12. The U.S.-based agency has a 'BBB-' rating on India with a stable outlook.
S&P said it expected the Reserve Bank of India to raise interest rates further to 5.65% to tame inflation. Retail inflation remained above the RBI's comfort level for the seventh month in a row and was 6.71% in July. Wholesale price-based inflation remained in double-digits for the 16th month in July at 13.93%. To tame stubbornly high inflation, the RBI has raised the key interest rate three times this year to 5.4%. The central bank had projected retail inflation to average 6.7% in 2022-23.
Technically, the important key resistances are placed in Nifty future are at 17707 levels, which could offer for the market on the higher side. Sustainability above this zone would signal opens the door for a directional up move with immediate resistances seen at 17770 – 17808 levels. Immediate support is placed at 17606 – 17474 levels.
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