Post Session: Quick Review

Today’s session turned out to be a disastrous day of trade for Indian equity markets. The frontline gauges ended the session with losses of around one and half percent on back of F&O expiry and regional geopolitical tensions. The benchmarks made a gap-up opening in early deals tracking the regional counter parts after OPEC took an important step towards a cap on crude-oil output. Investors took some encouragement from Finance Minister Arun Jaitley’s statement, who reacting to 32-point jump on World Economic Forum’s Global Competitiveness Index in two years, has said that it shows India has covered a long distance and is on its way to emerge as a major player in global economy. Some support also came after continuing its good run for the sixth day at a stretch, the rupee appreciated against the US dollar in early trade at the Interbank Foreign Exchange on continued selling of the greenback by exporters and banks amidst higher opening in the domestic equity market. Investors maintained a cautious approach with the RBI Deputy Governor SS Mundra’s statement that Banks may have to set aside more money as buffer against bad loans (non-performing assets) as recoveries are becoming difficult and resolutions few and far between. Mundra added that historical correlation between GDP growth and banks’ credit expansion is fast eroding due to proliferation of other institutions, and lenders will have to make a slew of changes to regain their share. Meanwhile, the markets fell sharply after the Army said it has conducted surgical strikes against terrorists across Line of Control. The street expects a near-term pause in the bull market on account of negative sentiment arising out of geopolitical tensions. It has been reported that the villages in Punjab which are 10 KM from International Border with Pakistan are being evacuated. Also, additional troops of Border Security Force (BSF) have moved in. The government has called an all-party meeting in the wake of surgical strikes across the India-Pakistan border.

On the global front, Asian equity markets ended in green, after an OPEC agreement to limit crude output fuelled a rally in oil and more than offset nervousness about a tight race for the US presidency. In China, the Shanghai Composite rose as liquidity flows in the market were watched ahead of a major holiday period next week. Bank of Japan Governor Haruhiko Kuroda stated that central bank will pursue the most appropriate yield curve to achieve its 2 percent inflation target. The governor added that central bank is ready to ease policy further by cutting its short- and long-term interest rate targets, or expanding risky asset purchases.

The BSE Sensex ended at 27894.10, down by 398.71 points or 1.41% after trading in a range of 27719.92 and 28475.57. There were 3 stocks advancing against 27 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 3.53%, while Small cap index was down by 3.83%. (Provisional)

The top losing sectoral indices on the BSE were Realty down by 5.84%, Power down by 4.00%, Metal down by 3.50%, PSU down by 2.71% and Consumer Durables down by 2.64%. (Provisional)

The few gainers on the Sensex were TCS up by 0.28%, ONGC up by 0.12% and ITC up by 0.04%. (Provisional)

On the flip side, Adani Ports & Special Economic Zone down by 4.62%, Lupin down by 3.77%, GAIL India down by 3.65%, Tata Steel down by 3.63% and Sun Pharma down by 3.34% were the top losers. (Provisional)

Meanwhile, in order to accelerate the development of inland water transport sector as an alternative mode of transport in the country, the Inland Waterways Authority of India (IWAI) has signed three separate memorandum of understanding (MoUs) with Dredging Corporation of India (DCI), Mormugao Port Trust (MPT) and Paradip Port Trust (PPT). These MoUs are meant to make use of the synergies, strengths and expertise of the Ports and Dredging sectors as water transport is an alternative, viable and environment friendly mode of transport.

The Shipping Ministry has said that the MoU with DCI will enable IWAI to maintain navigable depth in National Waterways. MoU will also help IWAI to develop National Waterway in Odisha and various National Waterways (NW) in Goa, it ensure development of the fairways, the dredging responsibilities of the IWAI are expected to increase rapidly in the next few years. Under the MoU, DCI will supplement the asset base of IWAI by purchasing/leasing shallow depth dredgers and operating them in National Waterways. DCI will also prepare cost estimates and determine the duration of the dredging projects.

As per the MoU between IWAI and MPT, there will be development of National Waterways like Mandovi, Zuari, Chapora, Mapusa and Sal rivers and Cumbharjua canal. IWAI and MPT will jointly work to achieve fairway development of the 182-Km stretch in Goa which includes dredging, river training works, bank protection, navigation aids, Vessel Traffic Management System (VTMS) etc. MPT will also provide project management supervision services related to the infrastructure works in the national waterways.

The MoU between IWAI and PPT will result in collaboration between IWAI and PPT to develop a viable navigation system on NW-5 in Odisha for Phase-1 to facilitate the movement of cargo vessels of economical size and viable capacity. This will include fairway development of 212 Km stretch. PPT will cooperate and assist IWAI in project management, supervision, services including planning, designing, consultancy in respect of the works related to fairway development, terminals construction and other related infrastructure works on NW-5.

The CNX Nifty ended at 8615.65, down by 129.50 points or 1.48% after trading in a range of 8558.25 and 8800.65. There were 3 stocks advancing against 48 stocks declining on the index. (Provisional)

The top gainers on Nifty were Bharti Infratel up by 3.47%, TCS up by 0.82% and Coal India up by 0.44%. (Provisional)

On the flip side, BHEL down by 7.23%, Adani Ports & Special Economic Zone down by 4.41%, Aurobindo Pharma down by 4.36%, Hindalco down by 4.30% and ICICI Bank down by 3.66% were the top losers. (Provisional)

The European markets were trading in red; UK’s FTSE 100 increased 74.13 points or 1.08% to 6,923.51, Germany’s DAX increased 70.93 points or 0.68% to 10,509.27 and France’s CAC increased 53.54 points or 1.21% to 4,485.99.

The Asian markets ended in green on Thursday after bank shares recovered in Europe, US durable goods orders data beat estimates and OPEC members surprised market participants with a preliminary deal to curb output. A final decision on the OPEC agreement for a modest oil output cut would be taken at the next formal meeting, set to be held in Vienna on November 30. Japanese shares rallied as the OPEC deal and sluggish retail sales data pushed the yen lower against the dollar and euro. Retail sales in Japan fell 1.1 percent in August from the previous month, when they rose 1.5 percent, a government report showed. Meanwhile, Chinese stocks rose, led by energy shares, but turnover in Shanghai was near a four-month low as traders braced for a long holiday.