Trends on SGX Nifty indicate positive opening for Indian indices

Trends on SGX Nifty indicate positive opening for Indian indices. The Indian markets are expected to open higher on positive global cues, said Devarsh Vakil, Deputy-Head Retail Research at HDFC Securities

After fluctuating between gains and losses, Indian markets ended marginally lower in the volatile session, The Nifty closed 22 points or 0.13 percent lower at 17222. In broader markets, midcap and smallcap indices ended marginally higher yesterday. Banks, financials, and consumer durables declined while metal, IT, pharma, and oil and gas stocks advanced.

After pausing for breath in last two days, SGX Nifty this morning is indicating a stirring rally, hopefully the bounce is neat and takes Nifty towards its biggest hurdles at 17500-17807 zone, said Prashanth Tapse, Vice President (Research), Mehta Equities Ltd.. Cautious optimism prevails after headlines indicate that Ukrainian President Volodymyr Zelenskyy said there was progress in the ceasefire negotiations with Moscow. The make-or-break for Nifty’s support is seen at the psychological 17,000-mark and below the same, expect a waterfall of selling which could take the index down to 16.691 with inter-week perspective. From a chartist standpoint, the technical landscape will improve considerably only if Nifty closes above its biggest hurdles at 17.807 mark, Tapse added.

Majority of the Asian markets are trading in green. US markets closed with handsome gains with NASDAQ ending with almost 2 percent gains on the back of NATO submit. On Thursday benchmark indices remained range bound amid negative global market cues and rising crude oil prices. Markets remained below crucial levels of 17,250 as highest call writing was witnessed at these levels, said Mohit Nigam, Head - PMS, Hem Securities.

On the Technical front, the key resistance level for Nifty50 is 17,300 followed by 17,400 and on the downside 17,100 and 17,000 will act as strong support. They key resistance level for bank nifty is 35,850 followed by 36,200 and on the downside 35,300 and 35,000 will act as strong support.

For the last five trading sessions, Nifty has been consolidating in the narrow range of 200 odd points. Bank Nifty continued its underperformance, as it plunged more than 1.7 percent against a minor fall in Nifty. Fall in crude oil prices will help bank stocks regain some lost strength, said Vakil.

On March 24, the Sensex settled 0.15 percent or 89.14 points lower at 57,595.68 points. Similarly, Nifty settled 22.90 per cent or 0.13 points down at 17,222.75 points.

OMCs hike fuel prices

Petrol and diesel prices were hiked by 80 paise a litre each on Friday, the third increase in four days as oil firms recoup losses from holding rates during the period prior to the recently-concluded assembly elections.

Petrol in Delhi will now cost Rs 97.81 per litre as against Rs 97.01 previously while diesel rates have gone up from Rs 88.27 per litre to Rs 89.07, according to a price notification of state fuel retailers. In the financial capital-Mumbai, petrol is being retailed at Rs 112.51 per litre and diesel now costs Rs 96.70 a litre.

In Kolkata, petrol is being retailed at Rs 106.34 while diesel costs Rs 91.42 per litre. In Chennai, petrol is available at Rs 103.67 and diesel for Rs 93.71.

The increases are the steepest single-day rise since the daily price revision was started in June 2017. With three increases beginning March 22, petrol and diesel prices have gone up by Rs 2.40 a litre.

Public sector OMCs' hike in diesel and petrol prices which will be effective from today can further impact the corporate earnings as companies are already facing the pressure of rising input cost. We advise investors to remain selective while selecting stocks as nifty can face tough resistance around 17350. said Nigam.

Stocks to watch out for

Tata Power and IDFC will be in limelight in the next few sessions as plans fructify for the deal for their renewables and asset management businesses respectively.

Asian shares steady

Asian shares were headed for a second successive week of gains on Friday, though trading was choppy amid hawkish US monetary policy, shifts in Chinese economic policy, and ongoing ructions in commodity markets due to the war in Ukraine, Reuters said.

MSCI's broadest index of Asia-Pacific shares outside Japan traded flat, but it's up 1 percent on the week. Japan's Nikkei was also little changed having closed the previous day at a nine week high.

Hong Kong shares were a drag on the regional benchmark, falling 0.5 percent, weighed down by tech stocks, as US and Hong Kong dual listed names took a hit from renewed fears that a row over audit records will force them to delist in the United States. Australian stocks rose 0.4 percent helped by miners, while Chinese blue chips lost 0.4 percent.

US stock close higher

US stocks closed near session highs Thursday as world leaders met to respond to Russia’s invasion of Ukraine and investors monitored remarks by Federal Reserve officials.

The Dow Jones Industrial Average rose 217.61 points, or 0.63 percent, to 34,576.11, the S&P 500 gained 39.88 points, or 0.89 , to 4,496.12. The pan-European STOXX Europe 600 index ticked down 0.2% percent and MSCI's main world stocks index, which no longer includes Russian companies, was up 0.41 percent on the day, Reuters said.

Upbeat economic data helped the upmove in indices. The S&P Global U.S. services flash purchasing managers index for March rose to 58.9 from 56.5 a month earlier, while the manufacturing flash PMI rose to 58.5 from 57.3. A reading of more than 50 indicates expanding activity.

The yield on benchmark 10-year Treasury notes was up 3.2 basis points to 2.354 percent; 10-year German Bunds crept over 0.53 percent.

Jobless benefit claims decline

US economic data showed first-time jobless benefit claims fell 28,000 to 187,000 last week, the lowest since 1969. U.S. durable-goods orders fell 2.2 percent in February, coming in below forecasts

Chipmaker Nvidia stock surged by almost 10 percent and Intel by 7 after reports that Nvidia may consider sourcing computer chips from Intel.

Crude prices to remain volatile

Crude oil prices cooled-off on Thursday after the EU abstains for fresh action on the Russian oil. EU leaders, along with NATO and Group of Seven members, gathered in Brussels on Thursday to assess their response to Russia’s month-old invasion of Ukraine. There’s no consensus among the EU on cracking down on Russian oil, with opposition from nations including Austria. Still, U.S. President Joe Biden remains in the region on Friday, and the administration may yet unveil measures to help Europe reduce flows of Russian natural gas. The United States could pump additional oil in to the system and could also help the European Union to supply natural gas to reduce dependence on the Russian oil and gas.

Rahul Kalantri, VP Commodities, Mehta Equities Ltd. said, crude oil prices are expected to remain volatile in today’s session ahead of the US President meeting outcomes with the NATO and EU leaders. WTI Crude oil is having support at $108.00–104.50 and resistance is at $114.00–118.50. In INR terms Crude oil has support at Rs 8,540-8,410; while resistance is at Rs 8,770–8,940.

IOC, BPCL, HPCL lost $2.25 bn due to fuel price freeze

IOC, BPCL and HPCL together lost around $2.25 billion (Rs 19,000 crore) in revenue for keeping petrol and diesel prices on hold during elections in five states, including Uttar Pradesh, Moody's Investors Services said on Thursday.

State fuel retailers did not revise petrol and diesel rates for a record 137 days despite prices of crude oil (raw material for producing fuel) rising to $120 per barrel compared to around $82 in early November when the hiatus began.

If crude oil prices continue to average around $111 a barrel, the three rated entities - IOC, BPCL and HPCL - will incur a combined daily loss of around $65-70 million on the sale of petrol and diesel unless fuel prices are increased to cover the rising crude oil prices, it said.

Gold, silver prices up

Gold and silver prices are sharply higher in Thursday trading session, as safe-haven demand is featured amid marketplace risk aversion that remains elevated amid the Russia-Ukraine war. Sharp gains in crude oil prices this week are also bullish for the metals markets, even though oil prices backed off today. April gold futures were up by $26.70 at $1,964.00 and May silver was up by $0.736 at $25.925 an ounce.

The Russia-Ukraine war and its widespread market implications continue on the front burner. President Biden Thursday is meeting with NATO and EU leaders to discuss the war. The two-day summit will be held at NATO headquarters in Brussels.

There are some reports surfacing that Russian President Putin’s war is producing cracks in the Kremlin. The reports said the Russian central bank chief quit and has left the country, while another official wanted to resign but Putin would not allow it.

Technically, April gold futures prices hit a two-week high today and saw a bullish upside breakout from the recent sideways trading range. Bulls have the firm overall near-term technical advantage. Rahul Kalantri, VP Commodities, Mehta Equities Ltd. said, both precious metals are expected to remain firm in upcoming sessions. Gold has support at $1937.40-1922, while resistance at $1976-1988 per troy ounce. Silver has support at $25.50-25.25, while resistance is at $25.98-26.20. In INR terms gold has support at Rs 51,820–51,650, while resistance is at Rs 52,220–52,330. Silver has support at Rs 68,474- 68,120 while resistance is at Rs 69,635–70,100.

USDINR outlook

On March 24, the Indian Rupee made a dull opening at 76.34 levels and thereafter traded in a range between 76.23 to 76.40 levels owing to continuous demand for dollar by importers coupled with suspected IPO related inflows into the system. Heena Naik, Research Analyst - Currency, Angel One Ltd, said, in the upcoming session, the local unit is likely to continue with its sideways trend as investors refrain from taking any risky bets over to the weekend. However, the possibility of USDINR going south is more on the back of year-end closing dollar selling by IT companies. USDINR is expected to trade in a range between 76.00 to 76.50 levels, Naik said.

USDINR 29March futures contract showed high volatility on Thursday. Rahul Kalantri, VP Commodities, Mehta Equities Ltd. said, "We observed that a pair crossed its immediate resistance level of 76.3000 but facing steep resistance around 76.5500 levels. Looking at the technical set-up, a pair only cross and sustain above 76.5500 could show further strength; support is placed at 75.9500 levels. We expect a pair could trade in the range of 75.9500-76.5500 and either side breakout of the range will give further directions," he added.

Stocks under F&O ban

Seven stocks – Balrampur Chini Mills, Delta Corp, Indiabulls Housing Finance, Vodafone Idea, L&T Finance Holdings, SAIL, and Sun TV Network – are under the F&O ban for March 25.

(With inputs from Reuters)

Published on: Friday, March 25, 2022, 08:35 AM IST