Dear Trader…
Indian equity benchmarks ended lower for a fifth straight day on Tuesday, dragged by heavy selling pressure in IT, FMCG and TECK stocks. The domestic indices fluctuated between gains and losses throughout the day before plunging sharply in late deals. Markets made positive start but soon turned volatile, as traders turned cautious after an Reserve Bank of India (RBI) article has flagged risks of disruptive spillovers from geopolitical hostilities and said India faces these challenges from a position of strength built on broadened vaccine coverage, financial sector resilience and robust exports and remittances and fiscal reprioritisation to spur capital spending on infrastructure.
However, markets managed to trade in green in late morning deals, taking support also came as working paper of the World Bank stated that extreme poverty in India declined by 12.3 percentage points between 2011 and 2019, with rural areas doing better than urban centres. But, a sudden sell-off during the fag-end of the session drove the markets down. Weaker quarterly corporate earnings, ongoing Russia-Ukraine spat, and high inflation worries also dented investor sentiment.
Nifty futures opened at 17275.00 points against the previous close of 17229.60 and opened at a low of 16843.30 points. Nifty Future closed with an average movement of 470.70 points and a decline of around 318.70 points and 16910.90 points...!!
On the NSE, the midcap 100 index will decline 1.37% and smallcap 100 index is closing decline 1.66%. Speaking of various sectoral indices, IT, FMCG, Realty and Media stocks saw heavy selling on the NSE, while all other sectoral indices also closed lower.
At the start of intra-day trading, April gold opened at Rs.53248, fell from a high of Rs.53416 points to a low of Rs.53010 with a decline of 229 points, a trend of around Rs.53043 and March Silver opened at Rs.69998, fell from a high of Rs.70390 points to a low of Rs.69624, with a rise of 43 points, a trend of around Rs.70019.
Meanwhile, an Reserve Bank of India (RBI) article on 'State of the Economy', published in the April 2022 RBI Bulletin, has flagged risks of disruptive spillovers from geopolitical hostilities and said India faces these challenges from a position of strength built on broadened vaccine coverage, financial sector resilience and robust exports and remittances and fiscal reprioritisation to spur capital spending on infrastructure. The article said India enters Samvat 2079 having crested the third wave of the pandemic with economic activity returning to speed in several sectors.
However, these gains are at risk from disruptive spillovers from geopolitical hostilities as increasingly evident in inflation prints, tightening financial conditions and a terms of trade shock accompanied by portfolio outflows. It pointed out that going forward, spurring private investment remains a key thrust area for sustaining growth on a durable basis. However, it said views expressed in the article are those of the authors and do not necessarily represent the opinion of the central bank.
Technically, the important key resistances are placed in Nifty future are at 17007 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 17077 – 17107 levels. Immediate support is placed at 16808 – 16676 levels.
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