Post Session: Quick Review

Indian markets rallied on Friday, recovering all their previous session losses and reclaiming their crucial psychological levels of 27000 (Sensex) and 8200 (Nifty) intraday, though Sensex managed to preserve its turf, Nifty ended marginally lower. Traders that took cues from the good going in the global markets were supported by statement of Central Board of Excise and Customs (CBEC) Member Service Tax V S Krishnan’s that GST can be implemented anytime during a year and not only the beginning of a financial year once the Bill is passed, he said that missing the April 1, 2016, deadline does not mean going to 1st April 2017. He also assured that the revenue neutral rate would not exceed 20 percent. Also, there was some sense of support with International Monetary Fund chief Christine Lagarde’s statement that the global lender may push ahead with interim steps to give emerging markets a bigger say, despite a stalemate in the US Congress over approval of broader governance reforms.

The global cues remained sanguine and after an overnight rally in the US markets, the Asian markets surged, extending a global equity rally, amid speculation the Federal Reserve won’t be raising interest rates until risks from outside the US subside. The emerging-market currencies too were up for their biggest weekly gain in more than six years. The European markets too made a strong start as oil prices rose to their highest in three months, ahead of key data of balance of trade from UK and industrial production data for August from Greece.

Back home, markets made a good start and managed to hold the gains till noon, however some profit taking emerged towards the second half and it seemed the markets will repeat the last session fate but traders going ahead for the earnings season next week, started buying the value stocks, specially the tech counter, which will majorly announce their numbers next week. Though, the trade remained a bit volatile too but the markets posted good gains by last. Market sentiments were aided by the strength in rupee, which moved higher on sustained bouts of dollar selling by banks and exporters amid weak dollar overseas. Auto sector though posted a modest gains after data released by Society of Indian Automobile Manufacturers (SIAM) said that domestic passenger car sales rose 9.48 per cent to 1,69,590 units in September from 1,54,898 units in the same month a year ago. Though, total two-wheeler sales in September declined 1.06 per cent to 15,37,137 units and sales of commercial vehicles were up 12.07 per cent at 62,845 units in September. Realty stocks too remained in limelight, as the Reserve Bank of India (RBI) has said that banks can provide home loans up to 90% for properties that cost up to Rs 30 lakh. Earlier, the facility was available only for properties that cost up to Rs 20 lakh. Sobha Developers surged by over 6%, NBCC gained over 3%, Ahluwalia Contracts too ended up by over a percent.

The BSE Sensex ended at 27021.58, up by 175.77 points or 0.65% after trading in a range of 26910.59 and 27200.44. There were 18 stocks on gainers side against 12 stocks declining on the index. (Provisional)

The broader indices made a mixed closing; the BSE Mid cap index was down by 0.13%, while Small cap index up by 0.13%. (Provisional)

The gaining sectoral indices on the BSE were IT up by 1.47%, TECK up by 1.23%, Metal up by 1.00%, Auto up by 0.38%, Bankex up by 0.35%, while PSU down by 0.44%, Power down by 0.26%, Oil & Gas down by 0.19%, Realty down by 0.14%, FMCG down by 0.12% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were Vedanta up by 12.60%, Tata Steel up by 4.28%, Tata Motors up by 4.21%, Infosys up by 3.14% and ICICI Bank up by 2.59%. On the flip side, Coal India down by 2.96%, Maruti Suzuki down by 1.96%, BHEL down by 1.35%, Sun Pharma Inds. down by 1.24% and Hindustan Unilever down by 0.73% were the top losers. (Provisional)

Meanwhile, amid repeated push of the government for financial inclusion, RBI Governor Raghuram Rajan sounded a cautious note and has said that financial inclusion should not be pressed beyond a point because beneficiaries may not have the capacity to make use of funds being made available to them.

Rajan who was speaking on the sidelines of IMF-World Bank meetings, said that pushing financial inclusion beyond a point can have negative impact because people at the bottom of pyramid do not have capacity to absorb credit. He said “In my sense, beyond a certain point... (financial inclusion) becomes actually negative,” he said, adding that everyone should not be pushed to borrow.

RBI governor also emphasized that technology and e-model could be used for improving businesses at remote centres and made a strong case for developing capacities to deal with the misuse of technology by criminal elements.

Recently, sticking to its theme of financial inclusion and making credit available for small borrowers, the Reserve Bank of India granted in-principle licences to set up small finance banks to 10 applicants, all microfinance companies.

The CNX Nifty ended at 8178.00, up by 48.65 points or 0.60% after trading in a range of 8139.65 and 8232.20. There were 23 stocks in green against 27 stocks in red on the index. (Provisional)

The top gainers on Nifty were Vedanta up by 12.70%, Tata Steel up by 4.38%, Tata Motors up by 4.30%, Infosys up by 3.21% and ICICI Bank up by 2.84%. On the flip side, Coal India down by 3.02%, Asian Paints down by 2.28%, Bank Of Baroda down by 2.26%, Maruti Suzuki down by 1.95% and Sun Pharma Inds. down by 1.16% were the top losers. (Provisional)

European markets were trading in green, France’s CAC gained 41.22 points or 0.88% to 4,717.13, UK’s FTSE 100 was up by 46.09 points or 0.72% to 6,420.91 and Germany’s DAX added 108.81 points or 1.09% to 10,101.88.

The Asian equity markets ended in green on Friday, on improving risk appetite globally as minutes from Federal Reserve’s latest meeting further eroded expectations of a near-term US rate hike. South Korea and Taiwan Stock Exchange was closed today on account of holiday. Japan’s Economics Minister Akira Amari stated that the country’s economy remained in a recovery trend although weakness was observed in some areas. Amari added that he hoped discussions between the government and private sector kicking off later this month would spur corporate capital spending and help sustain a moderate economic recovery. Japan’s Economy Watchers Current Index fell to a seasonally adjusted 47.5, from 49.3 in the preceding month. China’s retail sales growth slowed during the week-long National Day Holiday, adding to concerns about weakness in the world’s second largest economy. Revenues of retailers and catering firms grew 11% to 1.08 trillion yuan ($170.2 billion) during the October 1-7 ‘Golden Week’ holiday, a decline from the 12.1% growth in the same year-ago period. As China shifts to a new growth model, the International Monetary Fund chief Christine Lagarde has cautioned that this transformation of the world’s second largest economy is expected to be bumpy and not a smooth ride.