Dear Trader…
Registering seventh straight session fall, Indian equity benchmarks witnessed a sharp sell-off and lost nearly 5 percent in Thursday’s session, as escalating tensions between Russia and Ukraine spooked sentiments. Key indices opened in red and stayed in the negative terrain for whole trading session, as traders remain concerned with India Ratings’ report in which it has revised downwards its Gross Domestic Product (GDP) growth forecast for 2021-22 to 8.6 per cent from the consensus 9.2 per cent projected earlier.
Key indices continued their free fall during the final hour of trade, as sentiments remained downbeat with Fitch Ratings’ statement that India's economy is rapidly recovering from the pandemic but uncertainties remain around its medium-term debt trajectory. It said financial institutions face an uneven recovery due to lingering asset-quality risks and capital limitations. Some pessimism also came as Foreign Institutional Investors (FII) remained net sellers of domestic stocks on Wednesday. FIIs sold Rs 3,417 crore worth equity.
Nifty futures opened at 16600.00 points against the previous close of 17080.65 and opened at a low of 16230.10 points. Nifty Future closed with an average movement of 533.85 points and a decline of around 830.65 points and 16250.00 points...!!
On the NSE, the midcap 100 index will decline 5.74% and smallcap 100 index is closing decline 6.25%. Speaking of various sectoral indices, PSU Bank, Realty, Media and Auto 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.50800, fell from a high of Rs.52797 points to a low of Rs.50800 with a decline of 1836 points, a trend of around Rs.52215 and March Silver opened at Rs.64737, fell from a high of Rs.68097 points to a low of Rs.64737, with a decline of 2560 points, a trend of around Rs.67145.
Meanwhile, RBI Deputy Governor M D Patra has said India's GDP will be just one per cent above the pre-pandemic level even after the estimated 9.2 per cent growth in FY22, and this factor coupled with comfort on inflation make the RBI to continue with the accommodative monetary policy. Making it clear that India's slide on growth began in 2017, much before the pandemic, Patra said the country has lost up to 15 per cent of output forever, which has resulted in the loss of livelihoods as well.
He stated ‘India is in a comfortable position as far as inflation is concerned. And, since that is there, we have the headroom to support growth and we will do so because we are dealing with lost output, lost livelihoods.’ He mentioned that the 6.01 per cent headline inflation in January is the peak level and the same will decline to the RBI's target of four per cent by the December 2021 quarter.
On growth, he said India, which had one of the strictest lockdowns on entering the pandemic in 2020 that led to a nearly one-fourth contraction in the economy in Q1FY21, was the second worst-hit country after Peru. ‘And, if you knock out the fiscal stimulus, India exceeds the depression of Peru. So, we have dug out of the deepest recessions in the world,’ Patra added
Technically, the important key resistances are placed in Nifty future are at 16272 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 16303 – 16373 levels. Immediate support is placed at 16160 – 16006 levels.
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