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Market Report

Monday, 20-Oct-2014

NSE

  • The 30-share index ended at 26,429.85, up 321.32 points or +1.23 per cent. It touched a high of 26,517.90 and a low of 26,368.94 in intraday trade today. The Nifty closed at 7,879.40 today, up 99.70 points or +1.28 per cent. It touched a high of 7,905.95 and a low of 7,856.95 in intraday trade.

  • Our markets opened with a gap-up and rallied strongly on the back of positive cues from global peers and positive developments back home. However, it pared some of the intraday gains following weakness in European markets. The Indian markets pared most of the losses of last week as BJP win in assembly elections and oil & gas reforms boosted sentiment.

  • FII/FPIs have made a comeback today and were net buyers worth Rs 1040.08 crores. This is the first time this month that they have been net buyers, and only the 3rd time in the last 20 sessions. See our 'Market Stratistics' page. We had correctly predicted this in our pre-market report today. Foreign institutional investors are expected to make further comebacks following the recent developments in India.

  • The Indian rupee was trading higher at Rs 61.26 to the US dollar compared to its previous close of Rs 61.44 on sale of US dollars by exporters and banks following the fuel reforms announced by the government. Globally, Asian markets closed higher with Japan's Nikkei share average rising 3.8% today to post its biggest daily rise since June 2013 on the back of upbeat US economic data. But European shares were trading marginally lower after investors booked profits after sharp gains on Friday.

  • Inflation is on a downward trajectory and has seen a sharp decline with food inflation coming down sharply. The recent decision to lower diesel prices will further lower inflationary pressure in coming months. Diesel is the most used fuel in agriculture sector and transportation which have a direct impact on food prices. A cut in diesel prices will not only help cool off inflation but also lower the government's subsidy bill. According to a Kotak Institutional Equities report, this will create more space for the Reserve Bank of India to ease its policy stance and cut policy rate sooner than hitherto believed.

  • The nervousness in the market in the past few days had been more because of global concerns rather than anything India specific, said Devang Mehta of Anand Rathi Financial Services. In fact, India is a big beneficiary of low commodity & crude prices. The focus again shifts to the earnings season, where the market has been rewarding companies that has consistently been coming up with good numbers, he added.

  • Nifty could hit 8000-8050 levels in coming days, says Ashwani Gujral. The market should have closed at the highs of the day. The first day defines what kind of rally it would be and it looks slightly to be a weak upswing. One that could probably go 200 points from here, basically from 7850, say, till 8000-8050 and you will have up and down days, he adds.

NIFTY 3-Month

(Data/Charts courtesy NSEI/Yahoo!/iCharts/The Economic Times)