Post Session: Quick Review

It was a block buster performance of the Indian markets, with major bourses surging to near their one year highs. The markets remained in jubilant mood from the very beginning amid strong global cues and broad based buying was witnessed with the midcap index surging to a lifetime high. Traders rejoiced the brightened global economic outlook after a better than expected jobs data from US, while on domestic front there were hopes of the Good and Services Tax Bill being passed in the upcoming Parliament session that helped the market surge. There was some report that Congress, the main opposition party in Parliament is planning to drop its main demand - the tax rate to be written into Constitutional amendment. Congress may do away with the demand if the ruling government provides strong commitment to reasonable tax rate, as deemed fit by the party. The implementation of GST could boost India's GDP by 1-2 per cent. The surge in domestic currency too supported the markets, the Indian rupee on Monday strengthened over three-week high against the US dollar, tracking the gains in the global equity and currencies markets and as exporters and banks stepped up selling of the American currency. Hopes that India Inc. in the first quarter will post best revenue growth in two years also boosted sentiments, after private lender IndusInd Bank kickstarted the June quarter earnings season, reporting a 26 per cent jump in its quarterly net profit to Rs 661 crore, as compared to Rs 525 crore in the corresponding period a year ago. Though, the shares were weighed down by the higher bad loans, its NPAs as a percentage of total advances ticked up sequentially to 0.38 per cent in June quarter from 0.36 per cent in March quarter. 

On the global front, the Asia markets traded higher, bolstered by election results in Japan and Australia and shrugging off concerns a strong US jobs report might push the Federal Reserve closer to hiking rates. European stocks too opened higher participating in the global rally after US nonfarm payrolls data on Friday. The latest jobs data from the US showed that the US economy had added 287,000 jobs during the month of June, beating expectations.

Back home, continuous buying activities by both funds and retail investors kept the momentum going for the markets through the day, and the trade remained steady with not even iota of profit taking since a gap-up start in the morning. Traders also took support from NITI Aayog Vice Chairman Arvind Panagariya’s statement that the government has put the economy on the path of reform to achieve a high growth trajectory though there are significant lags between policy decisions and outcomes which need to be addressed. He also said that today, the economy is far healthier compared to the last year of UPA II in all macroeconomic parameters. All the sectoral indices posted good gains, led by finance, auto, realty and banking. Auto shares came into action after sales of passenger vehicles in June grew for the 12th straight month, according to data released by the Society of Indian Automobile Manufacturers (SIAM), domestic passenger vehicle sales grew 2.68 percent to 2,23,454 units in June from 2,17,620 units in the same month last year. However, car sales were down 5.18 percent to 1,54,237 units as against 1,62,655 units in June last year, Motorcycle sales last month increased 7.52 percent to 9,43,680 units as against 8,77,690 units a year earlier. Total two-wheeler sales in June grew 12.26 percent to 14,68,035 units as compared with 13,07,704 units in the year- ago month. Sales of commercial vehicles were up 5.63 percent to 56,032 units in June, while vehicle sales across categories registered a growth of 10.7 percent to 17,95,894 units from 16,22,254 units in June 2015. Rate-sensitive real estate and auto stocks also outperformed on hopes that Reserve Bank of India in its next policy meet in August will cut interest rate in the wake of the good progress of monsoon.

The BSE Sensex ended at 27632.86, up by 505.96 points or 1.87% after trading in a range of 27358.23 and 27647.48. There were 29 stocks in green against just 1 stock in red on the index. (Provisional)

The broader indices despite underperforming the benchmarks ended in green; the BSE Mid cap index was up by 1.48%, while Small cap index ended higher by 0.72%. (Provisional)

The top gaining sectoral indices on the BSE were Metal up by 2.30%, Bankex up by 2.13%, PSU up by 2.08%, Auto up by 2.03% and Realty up by 1.83%, while there were no losers. (Provisional)

The top gainers on the Sensex were Adani Ports & SEZ up by 5.12%, Tata Motors up by 3.89%, ICICI Bank up by 3.46%, SBI up by 2.84% and Maruti Suzuki up by 2.77%. On the flip side, Axis Bank down by 0.45% was the lone loser. (Provisional)

Meanwhile, to protect domestic manufacturers, the Revenue Department has imposed definitive anti-dumping duty of up to $168.76 per tonne on import of a chemical used in textile industry, originating from five countries-China, Iran, Taiwan, Indonesia and Malaysia. The imports of the chemical from these five countries will attract anti-dumping duty in the range of $ 83.08 per tonne to $ 168.76 per tonne.

As per the notification of Central Board of Excise and Customs the import restrictive tax has been imposed for five years by the Revenue Department on recommendations of the Directorate General of Anti-Dumping and Allied Duties. The DGAD, after an investigation, had found that the chemical 'Purified Terephthalic Acid' was being exported to India from the five countries below its normal value. Thus the chemical was being dumped into India. PTA -- a white, free flowing crystalline powder is the primary raw material for the manufacture of polyester chips which in turn is used in a number of applications in textiles, packaging, furnishings, consumer goods, resins and coatings.

MCC PTA India Corp and Reliance Industries had filed the application seeking levy of anti-dumping duty on PTA imports from these five countries. Indian Oil Corporation, another producer of PTA, had supported the petition. Based on the recommendations of the designated authority in its final findings, the revenue department has imposed anti-dumping duty in range from $83.08 per tonne to $168.76 per tonne depending on the producer and country of export.

Countries initiate anti-dumping probes to determine if the domestic industry has been hurt by a surge in below-cost imports. As a counter-measure, they impose duties under the multi-lateral WTO regime. Anti-dumping measures are taken to ensure fair trade and provide a level-playing field to the domestic industry. They are not a measure to restrict imports or cause an unjustified increase in cost of products.

The CNX Nifty ended at 8473.65, up by 150.45 points or 1.81% after trading in a range of 8407.05 and 8475.25. There were 48 stocks on gainers side against 3 stocks on losers’ side on the index. (Provisional)

The top gainers on Nifty were Adani Ports &SEZ up by 5.02%, Bank Of Baroda up by 4.88%, Tata Motors up by 3.89%, Tata Motors - DVR up by 3.76% and ICICI Bank up by 3.37%. On the flip side, HCL Tech. down by 0.67%, Axis Bank down by 0.38% and Indusind Bank down by 0.20% were the three losers. (Provisional)

European markets were trading with good gains, France’s CAC increased by 40.79 points or 0.97% to 4,231.47, UK’s FTSE 100 was up by 45.05 points or 0.68% to 6,635.69 and Germany’s DAX was higher by 134.76 points or 1.4% to 9,764.42.

Asian markets ended higher on Monday after the latest US jobs report showed the world's largest economy had added 287,000 jobs in June, far more than expected and the most since October. This was in contrast to May's dismal payroll gain of 11,000. While strong June jobs report put to rest lingering worries about the labor market and the broader economy, investors veered around to the view that the Federal Reserve will not hike interest rates in the near term, given the uncertain consequences of Brexit and the November presidential election. Investor sentiment was also bolstered by election results in Australia and Japan, a weaker yen and hopes of further policy easing in China. Japanese shares led regional gains as Prime Minister Shinzo Abe's ruling coalition won a landslide victory in an election for Parliament's Upper House, and the yen fell sharply against the dollar and euro on hopes for stimulus and economic revival. Investors shrugged off a report from the Cabinet Office, which showed that Japan's core machinery orders unexpectedly fell for a second straight month in May. Chinese shares rose as tepid inflation data boosted stimulus hopes. China's June consumer inflation grew at its slowest pace since January and the producer price index extended its decline, pointing to continued weak domestic demand.