Most experts are of the view that as long as Nifty holds above 10800-10850, bulls should remain in charge of D-Street.
A volatile day for Indian markets. We started the day on a somber note but bulls managed to push the index higher in the second half of the trading sessions. The S&P BSE Sensex closed 186 points higher at 36,254 while the Nifty50 ended 47 points up at 10,910.
Both indices managed to reclaim crucial resistance levels towards the close of the trade. For Sensex, it was 36000 while for Nifty, it was 10900. Most experts are of the view that as long as Nifty holds above 10800, bulls should remain in charge of D-Street.
On the macro front, govt will unveil manufacturing PMI data for the month of December. The activity improved in November and touched an 11-month high. The Nikkei India Manufacturing Purchasing Managers' Index strengthened to 54.0 in November from 53.1 in October.
The Indian rupee strengthened against the US dollar, tracking gains in some Asian currencies. The rupee settled at 69.43, up 34 paise from its previous close of 69.77 on Tuesday. This was the highest close of the rupee since early August, said a report.
On the institutional side, FPI were net sellers in Indian markets for about Rs 48 crore while DIIs were net buyers to the tune of Rs 142 crore, according to provisional data.
Talking about the big interview of PM Modi to one of the media agency highlighted that the former Reserve Bank of India (RBI) governor Urjit Patel had personally written to Prime Minister Narendra Modi about wanting to resign, citing personal reasons, several months before stepping down from the office in December.
When asked if there was any political pressure on the governor to resign, Modi denied that was the case.
Hence, it might come as a relief to Mint Street as it signals that there may not be any tiff between the government and the Reserve Bank of India. The autonomy of RBI stays intact.
Big News:
Revenue collection from Goods and Services Tax (GST) fell to Rs 94,726 crore in December from Rs 97,637 crore a month ago, as per data released by the Finance Ministry on January 1.
While the December collections are lesser than November and October (where it exceeded 1 lakh crore), overall average collection for 2018-19 has shown marked improvement over 2017-18.
"This, coupled with decent growth in income tax collections, gives a clear indication that the tax base is expanding. Next couple of months may also see similar collections and government may want to have a more realistic estimate of GST collection for next year," said a taxation expert with PwC India.
The government has set a target of over Rs 12 lakh crore for the financial year 2018-19, which can be achieved if the average monthly mop up is around Rs 1 lakh crore, as compared with Rs 89,885 crore in 2017-18.
Technical News:
Nifty formed a Hammer-like candle on the daily charts
The positive momentum could be possible only if the Nifty holds 10,850 levels in coming sessions, experts said, adding the next target would be 10,985 followed by 11,176 levels.
Three levels: 10807, 10,923, 11000
Max Call OI: 11200, 11000
Max Put OI: 10500, 10000
Stocks in news:
Private sector lender Karnataka Bank on January 1 said it has revised upward MCLR by 0.15 percent to 9.10 percent for one-year tenor. The revised marginal cost of fund-based lending rate (MCLR).
Tata Motors reported an 8 percent decline in domestic sales to 50,440 units in December as compared with 54,627 units in the same month last year. Remember, the stock cracked over 60% in 2018.
Aurobindo Pharma USA Inc is recalling 80 lots of tablets used for the treatment of high blood pressure and heart failure from the American market due to the presence of impurity that may cause cancer in humans, the company said.
Technical Recommendations:
We spoke to SMC Global Securities and here’s what they have to recommend:
DCB Bank Limited: Buy| Target: Rs 179| Stop Loss: Rs 156| Return 8%
ICICI Bank Limited: Buy| Target: Rs 386| Stop Loss: Rs 345| Return 7%
Escorts Ltd: Buy| Target: Rs 785| Stop Loss: Rs 660| Return 10%
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