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Below is the View On Daily Market Commentary by Mr. Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.
“Indian equity markets despite opening on a strong positive note, slipped in red, tracking weak global markets which tanked on bleak economic outlook. Sensex fell 310 points to close at 30,380 level (-1.0%) while Nifty50 was down 69 points to close at 8,925 level (-0.8%). However, the overall market breadth was positive with both Nifty Midcap 100/Nifty Smallcap 100 up 1.3% each. Sector-wise it was a mixed bag with FMCG being the biggest gainer, up 4% followed by Realty, IT, Media and Metal. Banks (-2.2%) and Auto (-1.8%) were the worst performers dragging the market into red. India VIX cooled down 4% to 49 level. Brent crude futures slipped 4.4% to USD28.3 per barrel. On the currency front, the rupee tumbled 17 paise to an all-time low of 76.44 against the US dollar.
The IMF yesterday predicted that the world this year would suffer its steepest downturn since the Great Depression of 1930s. It slashed India's projected GDP growth to 1.9% for 2020 from 5.8% earlier. The death toll in India due to coronavirus rose to 377 while the number of cases in the country climbed to more than 11,400. On the other hand, global tally of the infections has crossed 19 lakh, with over 1.2 lakh deaths.
Sentiments in the first half of the session was upbeat given partial opening up of economy in phased manner from 20th April. However, it got dampened in the second half, tracking the weak global sentiments which got impacted due to bleak IMF projections. Going ahead, the markets would continue to remain volatile as it would track trend in coronavirus cases and government relief measures to combat the economic crisis due to it. With earnings season starting, investors would also focus on the management commentary with regards to the impact of Covid-19 on their respective businesses.
Technically, if Nifty sustains below 8900 zones, then we may see a fall towards 8650 and then 8550 zone. While on the upside, resistance is placed at 9250 then 9400-9500 zones.”
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