Post Session: Quick Review

Indian equity benchmark oscillated in negative and positive territory in a narrow range and ended the session slightly in green. The markets made a sluggish start in red in early deals as banking stocks led fall on fresh selling amid mixed Asian cues. The sentiments were dampened after the Reserve Bank of India (RBI) on Saturday introduced an incremental CRR of 100% for the fortnight to absorb the surge in liquidity in banking system following demonetisation of high value notes. The CRR hike will reduce the market liquidity considerably and lowers the chances of any rate cut by the RBI in its upcoming policy review. The rupee wiped off its opening gains and traded down against the dollar in early trade amid continued buying of the American currency by banks and importers. Foreign institutional investors were net sellers in domestic equity market on Friday, as they offloaded shares worth of Rs 2,038 crore, according to the data available with NSDL. Gross purchases and gross sales stood at Rs 6,179 crore and Rs 8,217 crore, respectively. Investors will be keeping an eye on crude oil prices which is expected to rise as producing nations contemplate production cuts. The Organization of Petroleum Exporting Countries (OPEC), the cartel that accounts for a third of global oil production, is meeting in Vienna on November 30, 2016 for a possible production cut. Russia, the largest non-OPEC oil producer, is also proposing a production freeze at current levels of output. Buying emerged with Union Minister Nirmala Sitharaman’s statement that India’s economy grew at 7.1 percent in the first six months of the current financial year despite subdued growth in the world economy. She added that various steps are being taken to boost industrial production and growth which includes ‘Make in India’ and ‘Startup India’ initiatives, Liberalisation of FDI (Foreign Direct Investment) policy and development of industrial corridors.

On the global front, Asian markets ended mostly in green, while Japanese stocks closed in red after seven straight sessions of gains as the yen gained sharply against the dollar and oil prices slipped. China’s central bank vice governor stated that current condition points to a stabilization of China’s yuan after a volatile performance against the US dollar, adding that the currency remains strong. European stocks moved lower as a decline in oil prices weighed on the energy sector and as concerns over an upcoming referendum in Italy, dampened market sentiment.

Back home, liquor stocks like United Spirits, Pincon Spirit, IFB Agro Industries, Jagatjit Industries, Globus Spirits, Empee Distilleries, Tilaknagar Industries, GM Breweries, Associated Alcohols & Breweries, Som Distilleries & Breweries, Pioneer Distilleries, Ravi Kumar Distilleries and Khoday India closed in green on an anticipation of an increase in demand ahead of the end of the year demand for liquors owing to new year parties around the country.

The BSE Sensex ended at 26333.61, up by 17.27 points or 0.07% after trading in a range of 26183.22 and 26413.99. There were 16 stocks advancing against 14 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.97%, while Small cap index was up by 0.64%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 1.82%, Power up by 1.47%, FMCG up by 1.21%, Metal up by 1.04% and Oil & Gas up by 0.92%, while Consumer Durables down by 1.17%, Bankex down by 1.14% and IT down by 0.20% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were Bharti Airtel up by 5.78%, Adani Ports & Special Economic Zone up by 2.79%, ONGC up by 2.03%, ITC up by 2.01% and Hero MotoCorp up by 1.84%. (Provisional)

On the flip side, SBI down by 2.63%, Mahindra & Mahindra down by 1.91%, ICICI Bank down by 1.64%, HDFC down by 1.00% and TCS down by 0.96% were the top losers. (Provisional)

Meanwhile, in view of the problems faced by the transporters after the government’s decision to demonetize Rs 500 and Rs 1,000 notes, the Associated Chambers of Commerce & Industry of India (Assocham) urged the government to consider among other relief measures, increasing the cash withdrawal limits for logistic and transport fleet owners as they need hard cash for meeting expenses for crew members including truck drivers and cleaners. It said that the note ban has come as a bottleneck to the transport business.

As per the latest Assocham study on Transport and Logistics, a close to 10 percent of the en route expenses of trucks on trunk routes are accounted for by drivers and other support crew for the journeys which take 7-8 days on a single trip. The study noted that the fuel accounts for 52-66 percent of the total trip expenses, another 25-40 percent are to be accounted for sub heads like tolls, octroi, speedy clearance at check posts etc. Hence, all this money is required in cash, the driver also acts as a petty cashier.

The industry body has suggested the government to review the cash withdrawal limit of Rs 50,000 from the current account per week and raise to minimum Rs 4-5 lakh, which is bare minimum. Besides, the fleet owners face other problems which need to be resolved for improving the overall efficiency of the fleet owners and ease of doing business. Faster turnaround of trucks alone in the absence of check posts may improve the operational efficiency of the road transport sector. According to the study, presently, there are 177 inter-state check posts and 268 toll barriers on national highways.

The CNX Nifty ended at 8119.00, up by 4.70 points or 0.06% after trading in a range of 8066.50 and 8146.50. There were 29 stocks advancing against 22 stocks declining on the index. (Provisional)

The top gainers on Nifty were Bharti Airtel up by 6.71%, Tata Power up by 3.85%, Zee Entertainment up by 3.75%, Idea Cellular up by 3.73% and Adani Ports & Special Economic Zone up by 3.15%. (Provisional)

On the flip side, Bank of Baroda down by 3.07%, SBI down by 2.64%, IndusInd Bank down by 2.53%, Yes Bank down by 1.69% and ICICI Bank down by 1.65% were the top losers. (Provisional)

The European markets were trading in red; UK’s FTSE 100 decreased 47.14 points or 0.69% to 6,793.61, Germany’s DAX decreased 93.51 points or 0.87% to 10,605.76 and France’s CAC decreased 39.17 points or 0.86% to 4,511.10.

Most of the Asian markets made a positive closing on Monday, though there was some cautiousness too ahead of the OPEC meeting and after Saudi Arabia backed out of the non-OPEC meeting. Chinese market surged to an 11-month high, on upbeat industrial profits data for October that bolstered optimism that China's economic growth is possibly bottoming out. The Hong Kong market too posted gains of about half a percent after China and Hong Kong securities regulators approved the launch of Shenzhen-Hong Kong Stock Connect. On the other hand the Japanese market snapped a seven-session winning streak, with a strengthening yen and lower prices weighing on markets. Though, some late hour strength in dollar led to recovery in the index.