Markets trim early gains; Sensex manages to end above 25,700 mark

Indian benchmarks despite getting a wonderful start and surging to around three fourth of a percent in first half of the session, failed to maintain the lead and ended with gain of around quarter a percent only. Sentiments were sanguine from the start of trade with the report that India’s GDP grew 7.6% in the year ended March, outstripping previous leader China and faster than last year's 7.2%.  January-March growth sped up to 7.9% from the preceding quarters, suggesting that despite the caveats, India will remain an island of relative prosperity in a world afflicted by economic uncertainty. Indicating yet another better tiding for the economy, Core sector production continued on its positive trajectory for the fifth straight month, with April growth accelerating the fastest in 17 months at 8.5%.  Core sector output has been growing steadily from December, with monthly readings being 0.9%, 2.9%, 5.7% and 6.4%, respectively, through March.  Some support also came with the report that India’s manufacturing PMI in May stood at 50.7 as against 50.5 in April, indicating an uptick in the manufacturing data. However, weak trend in global markets coupled with depreciation in rupee value limited the gains.

On the global front, Asian markets ended mostly in red on Wednesday as decline in crude oil prices dampened investors’ appetite for riskier assets, while the recently bullish dollar stalled against the euro and yen following a mixed bag of US economic data. Lingering uncertainty over Brexit and caution ahead of Thursday's OPEC and the ECB meetings, as well as Friday's US jobs report also kept investors cautious. Chinese markets had a choppy session, despite recent speculation about MSCI Inc including mainland stocks into its widely tracked benchmarks, while Japanese shares snapped a five-day winning streak as the yen strengthened and the latest survey from Nikkei showed manufacturing conditions in Japan weakened for a third consecutive month in May on weak demand from overseas consumers. Meanwhile, European stocks traded lower in early trade, as euro-region manufacturing slowed according to fresh purchasing managers' index. The index slid to 51.5 in May from 51.7 in the previous month.

Back home, the local benchmark indices got off to a rollicking opening as investors rejoiced after macro-economic indicators such as GDP numbers and core sector growth showing the country’s economy has gained momentum. Besides, a strong rupee, decent fourth quarter results and advancement of monsoons too were aiding the sentiments. The indices in no time climbed to intraday highs and traded around the psychological 26,850 (Sensex) and 8,200 (Nifty) levels. But the optimism soon started showing signs of easing in late hours of trade and profit booking in few sectors and drifting European markets weighed down the local bourses by the end of session. Finally, the NSE’s 50-share broadly followed index - Nifty garnered around quarter percent to settle above the crucial 8,150 level, while Bombay Stock Exchange’s Sensitive Index-Sensex accumulated around fifty points and closed above the psychological 25,700 mark. On the BSE sectoral space, the FMCG and Technology counters remained the top gainer in the space with over a percent gains followed by the IT and Realty pocket which gained modestly.  On the flipside, Banking counter languished at the bottom of the table with cut of over a percent, while the Capital Goods, Auto and Metal sectors settled with moderate cuts of over half a percent.  The market breadth remained optimistic as there were 1322 shares on the gaining side against 1314 shares on the losing side, while 156 shares remained unchanged.

Finally, the BSE Sensex gained 45.97 points or 0.17% to 26713.93, while the CNX Nifty rose 19.85 points or 0.24% to 8,179.95.

The BSE Sensex touched a high and a low 26857.25 and 26671.86, respectively. The broader indices made a mixed closing; the BSE Mid cap index ended down by 0.30%, while Small cap index up by 0.18%.

The top gaining sectoral indices on the BSE were FMCG up by 1.60%, TECK up by 1.13%, IT up by 0.83% and Realty up by 0.37%, while Bankex down by 1.19%, Capital Goods down by 0.61%, Auto down by 0.60%, Metal down by 0.55% and Power down by 0.46% were the top losing indices on BSE.

The top gainers on the Sensex were Adani Ports & SEZ up by 4.98%, Asian Paints up by 3.54%, Bharti Airtel up by 3.23%, ITC up by 2.60% and TCS up by 2.20%. On the flip side, SBI down by 3.39%, ICICI Bank down by 2.08%, BHEL down by 2.03%, Tata Motors down by 1.96% and Cipla down by 1.49% were the top losers.

Meanwhile, India became the fastest growing nation in the world for the January-March quarter, as the nation’s gross domestic product (GDP) grew 7.9 per cent in the fourth quarter, against a projected 7.7 per cent. The robust fourth quarter growth led to GDP posting 7.6 per cent growth in 2015-16, up from 7.2 per cent a year ago. Though, the annual growth rate remained the same, quarterly economic expansion changed in 2015-16 compared to earlier estimates.

As per the data released by the Central Statistics Office (CSO), real GDP or GDP at constant (2011-12) prices for the year 2015-16 is now estimated at Rs 113.50 lakh crore (Rs 113.51 lakh crore estimated earlier on 8th February, 2016), showing a growth rate of 7.6 percent (similar to 7.6 percent estimated earlier) over the First Revised Estimates of GDP for the year 2014-15 of Rs 105.52 lakh crore, released on 29th January 2016.

Real GVA, i.e, GVA at basic constant (2011-12) prices for the year 2015-16 is now estimated at Rs 104.27 lakh crore (as against Rs 104.38 lakh crore estimated earlier on 8th February, 2016), showing a growth rate of 7.2 percent (as against 7.3 percent estimated earlier over the First Revised Estimates of GVA for the year 2014-15 of  Rs 97.27 lakh crore, released on 29th January 2016.

The sectors which registered growth rate of over 7.0 percent were financial, real estate and professional services, posting growth of 10.3 percent, manufacturing 9.3 percent, trade, hotels, transport, communication and services related to broadcasting growing by 9.0 percent, and mining and quarrying showing growth of 7.4 percent. The growth in the agriculture, forestry and fishing, construction, electricity, gas, water supply & other utility services, public administration, defence and other services was estimated to be 1.2 per cent, 3.9 per cent, 6.6 per cent and 6.6 percent respectively.

The GDP grew 7.5 per cent in the first quarter of 2015-16, against 7.6 per cent projected in advance estimates; 7.6 per cent in the second quarter, against a projected 7.7 per cent; 7.2 per cent in the third quarter, against a projected 7.3 per cent; and 7.9 per cent in the fourth quarter, against a projected 7.7 per cent. Nominal GDP growth climbed to 10.4 per cent in the fourth quarter, from 9.1 per cent in the third quarter, pointing to inflationary pressure building up. The GDP growth rate of 7.6 per cent in 2015-16 is the highest in the new series.

The Gross National Income (GNI) at 2011-12 prices is now estimated at Rs 112.13 lakh crore (as against Rs 112.14 lakh crore estimated on 8th February 2016), during 2015-16, as against the previous year’s First Revised Estimate of Rs 104.28 lakh crore. In terms of growth rates, the gross national income is estimated to have risen by 7.5 percent during 2015-16, in comparison to the growth rate of 7.3 percent in 2014-15.

The per capita income in real terms (at 2011-12 prices) during 2015-16 is likely to attain a level of  Rs 77435 as compared to Rs72,889 for the year 2014-15. The growth rate in per capita income is estimated at 6.2 percent during 2015-16, as against 5.8 percent in the previous year.

The CNX Nifty traded in a range of 8,215.35 and 8,171.05. There were 25 stocks advancing against 26 decliners on the index.

The top gainers on Nifty were Adani Ports & SEZ up by 5.13%, Asian Paints up by 3.98%, Bharti Airtel up by 3.57%, ITC up by 2.86% and Bharti Infratel up by 2.68%. On the flip side, SBI down by 3.10%, Tata Motors down by 2.80%, Bank of Baroda down by 2.49%, Cipla down by 2.04% and Tata Motors DVR down by 2.02% were the top losers. European markets were trading in red; Germany’s DAX decreased 59.22 points or 0.58% to 10,203.52, UK’s FTSE 100 dropped 34.78 points or 0.56% to 6,196.01 and France’s CAC was down by 29.65 points or 0.66% to 4,475.97.

Asian equity markets ended mostly lower on Wednesday as oil extended overnight losses, the yen strengthened and a slew of data painted a mixed picture of regional economies. Lingering uncertainty over Brexit and caution ahead of Thursday's OPEC and the ECB meetings, as well as Friday's US jobs report also kept investors cautious. Chinese shares slipped as a slew of data reinforced investor concerns about a decelerating economy. While China's official manufacturing PMI came in at 50.1 for May, marking a third straight month of expansion, the Caixin manufacturing PMI contracted for the 15th straight month with a reading of 49.2, down from 49.4 in April. The official non-manufacturing PMI, a gauge of activity outside factory floors, slipped to 53.1 in May from 53.5 in April. Japanese shares snapped a five-day winning streak as the yen strengthened and the latest survey from Nikkei showed manufacturing conditions in Japan weakened for a third consecutive month in May on weak demand from overseas consumers.