Dear Trader…
Indian equity benchmarks plunged sharply on Monday, extending fall to the second straight session. The markets crash was mainly induced by heavy global sell off fuelled by escalating tensions between Russia and the West over Ukraine. Key indices made gap-down opening and stayed in red for whole day as India’s industrial production growth slowed down for a fourth straight month in December to 0.4 per cent mainly due to a poor performance by the manufacturing sector. According to the data released by the National Statistical Office (NSO), the manufacturing sector, which constitutes 77.63 per cent of the Index of Industrial Production (IIP), contracted by 0.1 per cent in December.
During the afternoon session, markets further fell as wholesale inflation across the country rose to 12.96 per cent in January, which was higher than expectation. The wholesale price index (WPI) grew 13.56 per cent during the month of December 2021, while the WPI for November last year was revised to 14.87 per cent from 14.23 per cent. The WPI in January 2021 was at 2.51 per cent. Some concern also came as data from depositories indicated that foreign portfolio investors (FPIs) have withdrawn a net Rs 14,935 crore from the Indian market in the first half of February. FPIs have been net sellers for the fourth consecutive month. As per data, FPIs took out Rs 10,080 crore from equities, Rs 4,830 crore from the debt segment and Rs 24 crore from hybrid instruments. Traders remained on sidelines ahead of CPI inflation data scheduled for Feb 14.
Nifty futures opened at 17129.00 points against the previous close of 17355.80 and opened at a low of 16801.00 points. Nifty Future closed with an average movement of 328.00 points and a decline of around 546.80 points and 16809.00 points...!!
On the NSE, the midcap 100 index will decline 3.94% and smallcap 100 index is closing decline 4.44%. Speaking of various sectoral indices, PSU Bank, Realty, Metal and Media stocks saw heavy selling on the NSE, while all other sectoral indices also closed lower.
At the start of intra-day trading, February gold opened at Rs.49450, fell from a high of Rs.49710 points to a low of Rs.49443 with a rise of 577 points, a trend of around Rs.49691 and March Silver opened at Rs.63100, fell from a high of Rs.64172 points to a low of Rs.63100, with a rise of 1016 points, a trend of around Rs.64004.
Meanwhile, SBI Research in its latest report has said that given the record government borrowing plan of Rs 14.3 lakh crore for FY23, the Reserve Bank of India (RBI), which already holds as much as 17 per cent of the Rs 80.8 lakh crore outstanding government bonds, will have to find buyers for at least Rs 2 lakh crore, as banks typically opt for short-term debt of under 10-years.
The Budget 2023 has pegged the Centre's gross borrowing at a record Rs 14.3 lakh crore. Together with the states, the gross borrowing will be Rs 23.3 lakh crore and the net will be Rs 17.8 lakh crore for the next financial year. The Budget seeks to pay back Rs 3.1 lakh crore next fiscal, up from Rs 2.7 lakh crore this fiscal. With Rs 80.8 lakh crore outstanding government bonds, the RBI is the second-largest holder of them after financial institutions.
Technically, the important key resistances are placed in Nifty future are at 16930 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 17007 – 17077 levels. Immediate support is placed at 16770 – 16707 levels.
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