Dear Trader…
Indian equity benchmarks recouped most of their initial losses, but ended in the negative zone on Wednesday amid dull global cues. Key gauges made gap-down opening and remained under immense selling pressure during early deals, as traders were concerned as domestic ratings agency Icra said India's current account deficit (CAD) will widen to 5 per cent of the GDP in the September quarter due to higher merchandise trade deficit. The trade deficit has doubled to $28.7 billion for August due to a 36.8 per cent expansion in imports and a 1.2 per cent decline in export earnings. Domestic sentiments remained pessimistic, amid private report estimating that India's consumer price index (CPI) firmed to 6.9% year-on-year in August, while core inflation likely stood at 6%.
However, key gauges recovered most of their lost ground and came off day’s lows in late afternoon deals, taking support from Moody's Investors Service’s statement that India's economic recovery is unlikely to be derailed by rising challenges to the global economy, higher inflation and tightening financial conditions, and affirmed a stable outlook for the country's rating Baa3. Also, Moody's saw the Indian economy expanding by 7.6 per cent in the current fiscal compared to 8.7 per cent growth in the last financial year that ended on March 31. For 2023-24, it estimates a 6.3 per cent GDP growth. Some support also came as Commerce and Industry Minister Piyush Goyal’s statement that India's goods and services exports have already crossed $675 billion in the last fiscal year and the country is now aspiring to take international trade to $2 trillion by 2030.
Nifty futures opened at 17543.35 points against the previous close of 17682.95 and opened at a low of 17521.25 points. Nifty Future closed with an average movement of 158.75 points and a decline of around 27.95 points and 17655.00 points...!!
On the NSE, the midcap 100 index will decline 0.50% and smallcap 100 index is closing decline 0.78%. Speaking of various sectoral indices, the NSE saw gains in Auto, PVT Bank, Bank, Fin Service And PSU Bank 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.50207, fell from a high of Rs.50362 points to a low of Rs.50007 with a rise of 12 points, a trend of around Rs.50293 and December Silver opened at Rs.52872, fell from a high of Rs.53650 points to a low of Rs.52637, with a rise of 313 points, a trend of around Rs.53459.
Meanwhile, domestic ratings agency Icra in its note has said that India's current account deficit (CAD) will widen to 5 per cent of the Gross domestic product (GDP) in the September quarter of current fiscal (Q2FY23) due to higher merchandise trade deficit. The trade deficit has doubled to USD 28.7 billion for August due to a 36.8 per cent expansion in imports and a 1.2 per cent decline in export earnings.
It mentioned ‘The current account deficit (CAD) is projected to widen to an all-time high of USD 41-43 billion in Q2 FY23 from the USD 30 billion expected in Q1 FY23. It is expected to widen to 5 per cent of GDP in Q2 FY23, the second highest level since Q3FY12.’ It stated for the first two months of the quarter, the monthly average trade deficit has trended higher at USD 29.3 billion as against USD 23.5 billion in the June quarter, driven by strong domestic demand which led to a surge in the imports while exports remained subdued amid international slowdown fears.
Technically, the important key resistances are placed in Nifty future are at 17606 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 17575 – 17505 levels. Immediate support is placed at 17737 – 17808 levels.
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