Dear Trader…
Snapping a 7-day losing streak, Indian equity benchmarks ended with strong gains on Friday, as investors cheered the RBI MPC announcement of the repo rate hike. Key gauges opened with minor cuts as traders were concerned as the RBI said India’s current account deficit (CAD) in April-June was at $23.9 billion, or 2.8 per cent of gross domestic product (GDP), much higher than the $13.4 billion, or 1.5 per cent of GDP, in January-March 2022.
Besides, foreign institutional investors sold a net Rs 35.99 billion ($441.7 million) worth of equities on Thursday, as per provisional data available with the National Stock Exchange. However, key indices turned green and witnessed strong momentum in morning deals, after the Reserve Bank of India (RBI)’s Monetary Policy Committee (MPC) announced a 50 basis points (bps) hike in the repo rate to 5.90 per cent on Friday in order to bring elevated inflation back to its target.
Sentiments remained up-beat with S&P Global Ratings’ statement that rising rates and increased European energy insecurity are hitting growth in almost every country, but India with an estimated 7.3 per cent growth this fiscal, would be the star among emerging market economies. Traders also took a note of report that the Centre has reduced its borrowing target for the financial year 2022-23 (FY23) by Rs 10,000 crore to Rs 14.21 trillion amid robust tax collections.
Nifty futures opened at 16815.00 points against the previous close of 16833.30 and opened at a low of 16764.25 points. Nifty Future closed with an average movement of 445.35 points and a rise of around 272.70 points and 17106.00 points...!!
On the NSE, the midcap 100 index will rise 1.60% and smallcap 100 index is closing rise 1.59%. Speaking of various sectoral indices, PSU Bank, PVT Bank, Bank and Financial Services stocks saw heavy gains on the NSE, while all other sectoral indices also closed higher.
At the start of intra-day trading, October gold opened at Rs.49971, fell from a high of Rs.50689 points to a low of Rs.49935 with a rise of 85 points, a trend of around Rs.50079 and December Silver opened at Rs.56500, fell from a high of Rs.57208 points to a low of Rs.56292, with a rise of 446 points, a trend of around Rs.56606.
On the global front, European markets were trading higher as government bond yields pulled back from recent highs and new data showed the U.K. economy has not yet fallen into a recession. U.K. GDP for the second quarter of this year has been revised upwards to show growth of 0.2 percent from the previous estimate of a contraction of 0.1 percent.
Asian markets settled mostly lower on Friday with growing worries about the U.K.'s fiscal policy, Europe's energy crisis and hawkish Fed commentary weighing on markets. Chinese manufacturing data proved to be a mixed bag, with the official PMI bouncing back to the expansion territory in September, while the Caixin PMI marked a second straight month of contraction.
Technically, the important key resistances are placed in Nifty future are at 17170 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 17202 – 17272 levels. Immediate support is placed at 17007 – 16808 levels.
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