Post Session: Quick Review

Indian markets could not hold the initial gains amid a volatile session of trade on Friday and ended modestly in red. The start was on a solid note with Sensex reclaiming the crucial level of 25800 level, but soon after profit booking started and continued intermittently till last that dragged the markets well below the morning highs into red. The early gains were induced by a Sub-committee of the FSDC headed by Reserve Bank of India (RBI) Governor Raghuram Rajan, stating that there was no immediate cause for worry for India from global economic developments and financial volatility. Additionally, NITI Aayog vice-chairman Arvind Panagariya made a strong pitch for 50-100 bps cut in the RBI’s key rates, seeking support for economic recovery.

On the global front, while the US markets extended the gains, the Asian markets showed a mixed trend as Investors kept grappling with heightened global equity volatility as they awaited the Federal Reserve’s decision next week and watching developments in China. Japanese market too remained volatile and despite recovery ended modestly in red amid hopes that central bank will expand monetary stimulus by next month. The European markets made a soft start, extending the last session’s weakness on rising concerns on companies' exposure to Brazil.

Back home, traders turned a bit cautious ahead of the industrial production data slated to be announced later in the day, there was general expectation of a modest decline in the IIP numbers for July from its previous month figure of 3.8%, as the core sector data too had shown a dismal data earlier. Banking stocks witnessed good bounce back despite the Deputy Reserve Bank of India (RBI) governor S.S. Mundra stating that in the next few days, RBI will announce the names of successful applicants who are to be granted small finance bank licences. The stocks rallied on the expectations that the consumer inflation for the month of August has cooled off further, giving room for the RBI to cut rates. The broader markets extended their gains and outperformed their larger counterparts. In sector specific actions, IT sector was one of the top gainers, led by rise in Infosys despite the company’s management warning that the margins will be under pressure specifically in larger deals for the first 12-18 months, before improving later. Though, it also said that the company is making corrections in its pricing strategy to win more deals. The PSU oil marketing companies that moved higher after the international crude oil prices eased on Friday due to a strong dollar and Saudi Arabia's dismissal of a producer summit, later gave up most of the gains after Paris based International Energy Agency in its latest report raised its global oil demand growth forecast, leading to some improvement in crude prices

The BSE Sensex ended at 25596.34, down by 25.83 points or 0.10% after trading in a range of 25530.41 and 25875.96. There were 11 stocks in green against 19 stocks in red on the index. (Provisional)

The broader indices outperformed the benchmarks and ended in green; the BSE Mid cap index was up by 0.06%, while Small cap index gained 0.49%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 0.61%, IT up by 0.41%, FMCG up by 0.40%, TECK up by 0.19%, Consumer Durables up by 0.06%, while Metal down by 1.68%, Capital Goods down by 0.71%, Auto down by 0.50%, INFRA down by 0.37%, Bankex down by 0.14% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were Wipro up by 1.38%, SBI up by 1.08%, Infosys up by 1.06%, ONGC up by 1.04% and HDFC up by 0.93%. On the flip side, Tata Steel down by 2.89%, Tata Motors down by 2.70%, Vedanta down by 2.56%, GAIL India down by 2.43% and BHEL down by 2.38% were the top losers. (Provisional)

Meanwhile, Commerce and Industry Minister Nirmala Sitharaman has said that India may be ranked better this year in the World Bank's 'Ease of Doing Business' report as the government has taken several steps in this direction such as having a timeline for clearance of applications, de-licensing the manufacturing of many defence products and introduction of e-Biz projects for single window clearance. Further, Sitharaman stated that the World Bank together with a professional agency could release the ranking of Indian states on 'ease of doing business' this week. Besides, she emphasized that most of the states have taken a series of steps to remove red-tapism and improve business environment and also said that “states can no longer be red-tape ridden states'.

Additionally, she highlighted that there exist huge opportunities in sectors such as health care, energy, automobile and defence for investments in northern states which have shown growth of about 7.7% during 2004 to 2014. The government is ensuring greater market access for Indian industry in the trade agreements which it is negotiating. The government has been making investments to improve infrastructure.

In the World Bank's 'Ease of Doing Business 2015' report India is ranked 142 among 189 nations. With the exception of two parameters (getting credit and protecting minority investors), India does not feature in the top 100 in the remaining parameters.

The CNX Nifty ended at 7783.65, down by 4.45 points or 0.06% after trading in a range of 7759.90 and 7864.85. There were 21 stocks on gainers side against 29 stocks on losers side on the index. (Provisional)

The top gainers on Nifty were BPCL up by 1.75%, SBI up by 1.34%, Wipro up by 1.30%, HDFC up by 1.20% and Asian Paints up by 1.06%. On the flip side, Cairn India down by 3.73%, BHEL down by 3.06%, Tata Steel down by 2.89%, Tata Motors down by 2.85% and Vedanta down by 2.56% were the top losers. (Provisional)

European markets were trading lower in early deals, Germany’s DAX declined by 83.66 points or 0.82% to 10,126.78; France’s CAC lost 34.32 points or 0.75% to 4,562.21and UK’s FTSE 100 was down by 13.72 points or 0.22% to 6,142.09.

The Asian markets closed mostly in red on Friday, as uncertainty over whether the US Federal Reserve will raise interest rates next week gripped investors. Japanese business sentiment turned positive in July-September and companies stuck to upbeat spending plans, a government survey showed, offering some relief for policymakers worried about a hit from slowing Chinese growth and ensuing market turmoil. The poll, the first comprehensive business confidence survey for the current quarter, followed a recent run of gloomy data, including a survey showing the service sector’s mood worsening in August. An index gauging sentiment at large manufacturers stood at plus 11.0 in July-September, rebounding from minus 6.0 in the previous quarter. Japan’s Corporate Goods Price Index fell to a seasonally adjusted annual rate of -3.6%. South Korea’s central bank reassured investors that its future policy decisions would be based on economic data, but noted that another rate cut soon was unlikely because the economy was already recovering as expected. The Bank of Korea’s seven-member policy committee unanimously held the base rate steady at a record-low 1.50 percent, the third straight month it unanimously kept the rate unchanged after cutting it in June.