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Wednesday, January 20, 2016

Pre Session- Sensex set to resume drop on global growth jitters

Indian equity benchmarks are likely to witness a gap down opening on Wednesday tracking a bearish trend across Asia as traders weigh a cutback of global economic growth forecasts by the International Monetary Fund (IMF) amidst an ongoing China slowdown, and a continued oil price collapse, souring the appetite for risky assets. Weakness in the CNX Nifty Index futures for January delivery which fell by 0.81 per cent or 59.5 points at 7,377.5 at 10:19 am Singapore time also signals that Dalal Street may open lower today. While it left its forecasts for growth in Asia’s third biggest economy unchanged at 7.3 per cent and 7.5 per cent in FY 2015-16 and FY 2016-17 respectively, the IMF cut the growth forecast for the world economy to 3.4 per cent in 2016 from 3.6 per cent earlier as a commodity slump and political turmoil hits emerging markets such as Brazil while China slows. China’s economic growth forecast for 2016 was left untouched at 6.3 per cent. Back home, traders will be focused on the Q3 earnings numbers of index heavyweights such as Axis Bank, JSW Energy and UltraTech Cement to be unveiled today. Shares of Reliance Industries Limited may witness buying momentum after the company in after-market hours on Tuesday reported a record quarterly net profit of Rs 7,290 crore for the October- December quarter of FY16, as refining margins soared to a seven-year high. Snapping a three-day losing streak, the 30-share Sensex on Tuesday rallied 291.47 points or by 1.21 per cent to end at 24,479.84 driven by bargain buying in beaten down stocks and a market rebound in China as slowing growth upped stimulus bets. Foreign investors pulled out a net USD 276 million from Indian stocks on January 18, resulting in a total outflow of USD 1.1 billion for the year so far.

Asian shares plunged on Wednesday as oil fell below the USD 28 per barrel and the IMF lowered its global economic outlook, fueling a flight to safe haven assets and prompting an exit from risky assets. China’s Shanghai Composite fell for the first time in three days led by a drop in shares of commodity producers amid worries that a slowing economy may erode profits. Hang Seng plunged over 3 per cent and Japan’s Nikkei 225 tanked over 2 per cent to almost a one-year low as a stronger yen curbed the lure for exporter stocks. Wall Street posted a mixed finish on Tuesday amidst optimism that China may do more to stem a slowdown after the economy grew at 6.9 per cent in 2015, the weakest pace since 1990 while Q4 growth slowed to 6.8 per cent. Oil’s slide to a fresh 12-year low weighed on sentiment as the IEA cut the outlook for global crude demand in 2016, fueling concerns over a supply glut. The Dow Jones Industrial Average advanced 0.17 per cent; the Nasdaq Composite fell 0.26 per cent while S&P 500 closed up 0.05 per cent.

Top traded Volumes on NSE Nifty – Vedanta Ltd. 25513321.00, State Bank of India 24501774.00, ICICI Bank Ltd. 14747672.00, Axis Bank Ltd. 14215698.00 and Tata Motors Ltd. 7304555.00.

On BSE, total number of shares traded was 32.06 Crore and total turnover stood at Rs. 3062.84 Crore.

On NSE Future and Options, total number of contracts traded in index futures was 312062 with a total turnover of Rs. 16242.27 Crore. Along with this total number of contracts traded in stock futures were 578114 with a total turnover of Rs. 26640.26 Crore. Total numbers of contracts for index options were 3824987 with a total turnover of Rs. 210998.18 Crore and total numbers of contracts for stock options were 361664 with a total turnover of Rs. 17772.18 Crore.

The FIIs on 19/01/2016 stood as net seller in equity and debt. Gross equity purchased stood at Rs. 3131.97 Crore and gross debt purchased stood at Rs. 256.50 Crore, while the gross equity sold stood at Rs. 4998.03 Crore and gross debt sold stood at Rs. 272.47 Crore. Therefore, the net investment of equity and debt reported were Rs. -1866.06 Crore and Rs. -15.97 Crore.