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Bears retained a tight grip on Dalal Street for the fourth day in a row on September 21, as the Nifty 50 - after gap up opening - fell sharply in the afternoon and broke crucial support of 11,000, but managed to pull back some losses in the latter part of the session to close off the day's low.
The free fall in Yes Bank after RBI's decision to end Rana Kapoor's term as CEO, and impact of the weakness in the rupee and hardening bond yield, started reflecting on NBFCs as sentiments were hit across sectors.
The Nifty Midcap index dropped 2.5 percent while Nifty Bank was down 2.6 percent and Realty lost 3.5 percent followed by auto, financial service and pharma.
The Nifty 50 started the day on a strong note at 11,271.30 and hit the day's high of 11,346.80 following positive global cues, and due to short covering, but suddenly crashed in the afternoon to break the 11,000-mark and hit an intraday low of 10,866.45, which last seen on July 9, showing a loss of 368 points intraday.
The index managed to recoup 2/3rd of losses in the last hour of trade to close 91.30 points lower at 11,143.10.
India VIX moved up sharply by 10.92 percent to 15.53 and during the day it made a high of 16.92 which is the highest level in the last seven months since February 20, 2018.
According to Pivot charts, the key support level is placed at 10,890.8, followed by 10,638.5. If the index starts moving upwards, key resistance levels to watch out are 11,371.1 and 11,599.1.
The Nifty Bank index closed at 25,596.90, down 680.45 points on Friday. The important Pivot level, which will act as crucial support for the index, is placed at 24,936.67, followed by 24,276.43. On the upside, key resistance levels are placed at 26,373.77, followed by 27,150.63.
Stay tuned to Moneycontrol to find out what happens in currency and equity markets today. We have collated a list of important headlines from across news agencies.
US markets end mixed; S&P 500, Dow hit new highs
The S&P 500 and Dow reached record highs on Friday ahead of Monday's major sector reshuffle, capping a week that largely shrugged off trade worries. The S&P 500 and the Dow were up, with the tech-heavy Nasdaq losing ground. All three were on track to post their second consecutive weekly gains, with the blue-chip Dow on its way to its best weekly percentage gain in over two months.
The Dow Jones Industrial Average rose 78.46 points, or 0.29 percent, to 26,735.44, the S&P 500 gained 3.04 points, or 0.10 percent, to 2,933.79 and the Nasdaq Composite dropped 18.66 points, or 0.23 percent, to 8,009.58.
Asian shares wobble as China halts trade talks with US
Asia shares eased in holiday-thinned trading on Monday and the safe haven yen gained as China canceled upcoming tariff talks with the United States, while oil prices jumped after top producers including Russia ruled out boosting crude output.
US stock futures were a touch weaker while MSCI’s broadest index of Asia-Pacific shares outside Japan dipped 0.3 percent. Australian shares fell 0.25 percent and New Zealand’s benchmark index faltered 0.6 percent.
SGX Nifty
Trends on SGX Nifty indicate a negative opening for the broader index in India, a fall of 22 points or 0.2 percent. Nifty futures were trading around 11,149-level on the Singaporean Exchange.
China's debt rises to $2.58 trillion by August-end
China's spiralling debt, a major concern for the slowing down of its economy, has risen to USD 2.58 trillion, a media report said Sunday. The country's top legislative body has decided that the upper limit for local government debt this year should be 21 trillion yuan.
China's local government debt balance stood at 17.66 trillion yuan (USD 2.58 trillion) by the end of August, but it remained within the official limit, state-run Xinhua news agency reported, quoting the Ministry of Finance. Over 526.6 billion yuan worth of the financing tools issued last month were special-purpose bonds for the development of public-interest projects, marking a substantial increase from 196 billion yuan in July.
Fitch ups India's growth forecast to 7.8% for FY19
Fitch Ratings on Friday upped India's growth forecast for the current fiscal to 7.8 percent, from 7.4 percent projected earlier. In its Global Economic Outlook, Fitch, however, flagged tightening of financial conditions, rising oil bill and weak bank balance sheets as headwinds to growth. "We have revised up our forecast for FY2018-2019 growth to 7.8 percent from 7.4 percent on the back of the better-than-expected 2Q18 outturn. India's growth likely peaked in 2Q18 (April-June) though," Fitch said.
The Indian rupee has been the worst-performing major Asian currency so far this year. "And despite the central bank's greater tolerance for currency depreciation, interest rates have been raised by more than anticipated," the global rating agency said in the report.
Oil rises as markets tighten ahead of Iran sanctions
Oil prices rose on Monday as US markets tightened just weeks ahead of Washington’s plan to impose new sanctions against Iran. Brent crude futures were at $79.74 per barrel at 0036 GMT, up by 94 cents, or 1.2 percent. US West Texas Intermediate (WTI) crude futures rose by 74 cents, or 1.1 percent, to $71.52 a barrel.
FPIs turn net sellers in Sept, pull out $2 bn so far
Overseas investors have pulled out a massive Rs 15,365 crore ($2.1 billion) from the capital markets so far in September, after putting in funds during the previous two months, on widening current account deficit coupled with global trade tensions. The latest outflow comes following a net infusion of close to Rs 5,200 crore in the capital markets, both equity and debt, last month and Rs 2,300 crore in July.
According to the latest depository data, foreign portfolio investors (FPIs) withdrew a net sum of Rs 6,832 crore from equities during September 3-21 and Rs 8,533 crore from the debt market, taking the total to Rs 15,365 crore (USD 2.1 billion).
RBI announces norms for co-origination of priority sector loans by banks, NBFCs
The Reserve Bank announced guidelines for co-origination of priority sector loans by banks and NBFCs with a view to enhancing flow of funds to the sector at competitive rates.
As per the norms issued by the RBI for all scheduled commercial banks (excluding Regional Rural Banks and Small Finance Banks) and Non-Banking Financial Companies - Non-Deposit taking- Systemically Important (NBFC-ND-SIs), the sharing of risks and rewards between these entities should be in a manner that enables appropriate alignment of respective business objectives, as per their mutual agreement.
Rupee firms up by 17 paise to 72.20 against US dollar
The rupee continued its bullish trend for the second day, rising 17 paise to end at 72.20 against the US dollar on sustained selling of the American currency even as local equities witnessed a high volatility.
The domestic currency hit an intra-day high of 71.70 before giving back early strong gains swayed by domestic stock volatility. The Indian unit briefly touched a low of 72.48. After drifting to a session low of 72.48, the local unit finally managed to pull back towards the tail-end trade and settled the day at 72.20, showing a gain of 17 paise, or 0.23 percent.
SEBI comes out with revised KYC norms for FPIs
Providing relief to foreign portfolio investors (FPIs), SEBI came out with revised Know Your client (KYC) norms as well as eligibility conditions for such entities. Certain categories of FPIs would be required to maintain a list of beneficial owners and provide the same to the regulator.
"Category II and III FPIs registered prior to this circular (existing FPIs) should provide the list of BOs and applicable KYC documentation within six months," SEBI said in a circular.
Govt to start merging regional rural banks, to cut tally to 36
The government has initiated consolidation of regional rural banks along with the public sector lenders and intends to bring down their number to 36 from the existing 56. In this regard, the Centre has begun consultations with states as they are one of the sponsors of the regional rural banks (RRBs) in the country, a senior Finance Ministry official has said.
The development assumes significance in the light of government earlier this month announcing decision to merge Bank of Baroda, Vijaya Bank and Dena Bank to create another global size bank. The proposed consolidation of RRBs and bringing down their tally from the existing 56 to 36 will usher in better scale- efficiency, higher productivity, robust financial health of such banks, improved financial inclusion and greater credit flow to rural areas, the official said.
Forex reserves rise by $1.2 bn to $400.5 bn
India's foreign exchange reserves rose by $1.207 billion to $400.489 billion in the week to September 14 on account of increase in foreign currency assets, according to RBI data. In the previous week, forex reserves had declined by $819.5 million to $399.282 billion.
In the reporting week, foreign currency assets, a major component of the overall reserves, increased by $1.055 billion to $376.154 billion, as per RBI data.
Garden Reach Shipbuilders IPO to open today
State-run Garden Reach Shipbuilders and Engineers will open its initial public offering for subscription on September 24 with a price band of Rs 115-118 per share. IDBI Capital Markets & Securities and Yes Securities India are book running lead managers, and Alankit Assignments is registrar to the issue. Equity shares are proposed to be listed on BSE and NSE.
The public issue consists offer for sale of 2,92,10,760 equity shares by Government of India. The offer includes a reservation of up to 5,72,760 equity shares for subscription by eligible employees. The offer will constitute 25.50 percent of the post offer paid-up equity share capital. Retail investors and employees will receive shares at a discount of Rs 5 per share on final offer price.
The issue will close on September 26. Bids can be made for minimum 120 shares and in multiples of 120 shares thereafter.
BSE to move 8 companies out of surveillance framework from Sep 24
Leading exchange BSE will move out eight companies from the additional surveillance measure (ASM) framework from September 24. The companies are Commex Technology, Oscar Investments, Tiaan Ayurvedic & Herbs, ACI Infocom, Kretto Syscon, Oasis Tradelink, Usher Agro, and VKJ Infradevelopers.
Usher Agro will be excluded from the framework from September 24 by the rival exchange NSE as well. In separate communications dated September 21, the exchanges also said that Globus Spirits has been shortlisted in ASM framework with effect from September 24.
London Stock Exchange strikes pact with NSE
The London Stock Exchange Group on Friday announced a new memorandum of understanding with the National Stock Exchange of India to cooperate on dual listings and the launch of the group's offerings in India.
London Stock Exchange (LSE) said the MoU is aimed at working together with the National Stock Exchange (NSE) on creating a dual listing route for Masala bonds and explore the launch of ELITE, LSE group's business support and capital raising programme for private high-growth companies, in India next year.
The MoU was signed in London by Vikram Limaye, MD & CEO of the NSE, and Nikhil Rathi, CEO, London Stock Exchange Plc, and witnessed by MK Das, Principal Secretary to the Chief Minister of Gujarat Vijay Rupani.
3 stocks under ban period on NSE
Securities in ban period for the next day's trade under the F&O segment include companies in which the security has crossed 95 percent of the market-wide position limit.
For September 24, Adani Enterprises, Adani Power and Wockhardt are present in this list.
With inputs from Reuters & other agencies
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