Indian markets settle with moderate gain

After trading on a feeble note for most part of the session, Indian benchmark indices managed to negotiate a close in the green terrain, as investors showed renewed buying interests in information technology, Consumer Durables and Realty counters. Investors got some comfort with RBI governor’s statement that there is further scope for banks to reduce lending rates as the Reserve Bank has already brought down its policy rates by 175 basis points since January 2015. Some support also came with Economic Affairs Secretary Shaktikanta Das’ statement that India will be able to pull off a 7% plus growth rate next fiscal as the Budget for 2017-18 has come up with several measures to provide a fillip to various sectors. Further, rejecting arguments that fiscal deficit target of 3.2% is optimistic, he said it is realistic and there is all possibility that revenues will exceed the target, as Budget has not taken into account the demonetisation windfall. However, gains remained capped on report that foreign portfolio investors (FPIs) sold shares worth a net Rs 127.69 crore on February 08, 2017. Adding the anxiety among market participants, RBI’s bi-monthly survey on consumer confidence indicate that Indian households are less confident of their current economic situation as people are uncertain about their immediate income, employment and spending capabilities. Meanwhile, banking stocks declined as RBI held repo rates at 6.25% for the second time in a row, changing its stance to 'neutral' from 'accommodative'. On the other hand, IT stocks gained traction as global IT major Cognizant has guided for a revenue growth of $3.51 billion to $3.55 billion for March quarter. The company expects March quarter non-GAAP diluted EPS to be at least $0.83 per share.

On the global front, Asian markets ended mostly higher on Thursday as investors grew more confident about China due to an ongoing commodity price rally along with Beijing's gentle monetary tightening, via money-market rates. Trading volumes remained rather thin in the wake of growing concerns over political instability in Europe and lingering uncertainty over US President Donald Trump's policies. However, ignoring better-than-expected core machinery orders data, Japan's Nikkei share average ended lower due to pressure from a stronger yen ahead of a meeting this week between US President Donald Trump and Japan's Prime Minister Shinzo Abe. Reports showed Japan's Core machinery orders rose 6.7 percent in December from the previous month, beating forecasts for an increase of 3.1 percent. Meanwhile, European markets were trading marginally higher as investors maintained caution amid rising political uncertainty.

Back home, after getting a gap up start, the local benchmarks showed some strength in early trades, but the sentiments turned pessimistic in late morning trades and indices start drifting lower, however the market regained its momentum in the final hour of trade and finished the day in positive territory. The NSE’s 50-share broadly followed index Nifty, added single digit gains to settle above the crucial 8,750 support level, while Bombay Stock Exchange’s Sensitive Index or Sensex gained around thirty-nine points and ended above the psychological 28,300 mark. Moreover, broader markets managed a touch better than the larger peers as the BSE’s midcap and smallcap indices settled with gains of 0.23% and 0.19% respectively. The market breadth remained optimistic, as there were 1384 shares on the gaining side against 1513 shares on the losing side, while 148 shares remained unchanged.

Finally, the BSE Sensex gained 39.78 points or 0.14% to 28329.70, while the CNX Nifty was up by 9.35 points or 0.11% to 8,778.40. 

The BSE Sensex touched a high and a low of 28469.48 and 28152.18, respectively and there were 15 stocks on gainers side against 15 stocks on the losers side on the index.

The broader indices ended in green; the BSE Mid cap index jumped 0.23%, while Small cap index was up by 0.19%.

The top gaining sectoral indices on the BSE were IT up by 1.64%, TECK up by 1.62%, Consumer Durables up by 0.80%, Realty up by 0.80% and FMCG up by 0.42%, while Metal down by 0.73%, Bankex down by 0.47%, PSU down by 0.36%, Capital Goods down by 0.29% and Power down by 0.03% were the top losing indices on BSE.

The top gainers on the Sensex were TCS up by 2.72%, Hero MotoCorp up by 1.26%, Infosys up by 1.24%, GAIL India up by 1.23% and Mahindra & Mahindra up by 1.06%. On the flip side, Cipla down by 2.65%, Tata Steel down by 2.29%, NTPC down by 2.09%, Larsen & Toubro down by 0.91% and Sun Pharma down by 0.84% were the top losers.

Meanwhile, dispelling any fear of slowdown, Indian economy attracted $4.68 billion foreign direct investment (FDI) in November 2016, up 60 per cent over the corresponding period last year of $2.93 billion. During the period, India received the maximum FDI from Singapore, Mauritius, the UK, the US, the Netherlands and Japan.

During April-November period of the current fiscal, FDI in the country grew to $32.49-billion against $24.81 billion in the same period previous year. Among the main sectors, services received the maximum FDI of $6.69 billion during the eight-month period of 2016-17, followed by telecom ($5.47 billion), computer hardware and software ($1.61 billion), electrical equipment ($2 billion) and information & broadcasting ($1.06 billion).

Foreign investments are considered crucial for India, needing around $1 trillion for overhauling its infrastructure sector. The government has been focusing to improve the ease of doing business and relax regulations for increasing FDI and in a view of growth perspective in FDI, the Finance Minister in his Budget speech announced to abolish Foreign Investment Promotion Board (FIPB) and come up with a new mechanism that could include approvals by the ministries concerned for expeditious clearance of foreign investment proposals which will improve ease of doing business.

The CNX Nifty traded in a range of 8,821.40 and 8,724.10. There were 28 stocks in green as against 23 stocks in red on the index.

The top gainers on Nifty were Bharti Infratel up by 2.56%, Zee Entertainment Enterprises up by 2.34%, Tech Mahindra up by 2.20%, TCS up by 2.03% and Aurobindo Pharma up by 1.49%. On the flip side, Hindalco down by 2.65%, Cipla down by 2.35%, Tata Steel down by 2.20%, NTPC down by 1.66% and Bank of Baroda down by 1.39% were the top losers.

The European markets were trading in green; UK’s FTSE 100 increased 2.84 points or 0.04% to 7,191.66, Germany’s DAX increased 23.94 points or 0.21% to 11,567.32 and France’s CAC increased 20.84 points or 0.44% to 4,787.44.

Asian equity markets ended higher on Thursday, although Japanese markets remained under pressure owing to the yen's overnight strength. Trading volumes remained rather thin in the wake of growing concerns over political instability in Europe and lingering uncertainty over US President Donald Trump's policies. With cues waited from Japanese Prime Minister Shinzo Abe's meeting with US President Donald Trump Friday in Washington, D.C., investors ignored better-than-expected core machinery orders data. Reports showed Japan's Core machinery orders rose 6.7 percent in December from the previous month, beating forecasts for an increase of 3.1 percent. Meanwhile, Chinese shares closed at a two-month high after reports that China would step up supply-side reforms and reduce overcapacity in the construction material sector. The Malaysian market was closed for Thaipusam festival.