Post Session: Quick Review

Indian equity benchmarks traded on a volatile note and pared losses in the late afternoon session but closed flat. The equity benchmarks made a negative start in early deals as traders tracked mixed global cues, even as data showed that China’s manufacturing sector expanded at a faster-than-expected pace in March - raising hopes that the world’s second-largest economy was picking momentum. Sentiments remained subdued with the report that the Reserve Bank of India (RBI) is likely to keep key interest rates unchanged on April 6, 2017. The RBI shifted to a neutral stance from accommodative in February and this, in turn, may prompt the central bank to hold rates in the ensuing meet early next month. Meanwhile, according to data available with the Securities and Exchange Board of India (SEBI), listed firms raised Rs 4,837 crore through Qualified Institutional Placement (QIP) route in the first 11 months of current fiscal, as compared to Rs 14,488 crore in the same period of 2015-16, translating into a drop of 67 percent. The funds have been raised for business expansion plans, repayment of loan, to meet working capital requirements and for other corporate purposes. Buying crept in driven by a rally in index heavyweight Reliance Industries as the company’s telecom venture Reliance Jio’s Happy New Year plan ends on Friday, which is also the end of its free services. April 1 onwards, Jio users will have to pay for the data services. Separately, after the Lok sabha approval, the GST rollout looks imminent from July 1 and there are hopes that it will give a huge boost to economic activity in almost all sectors of Indian economy. Economic Affairs Secretary Shaktikanta Das has said that GST is an outcome of hard work done over last many years and it would remove the shadow economy. Das has also said that the tax net will be widened under the new regime and this may result in reduction of general tax rate. S&P Global Ratings said that the effect of demonetization is fading and growth is likely to return to the pre-note ban stage, but a clearer picture of the economy will be available by June-end.

On the global front, Asian markets closed mostly in red, as investors digested a mixed set of economic data out of East Asia and President Trump’s tense tweets about his meeting with China’s Xi Jinping next week. Japanese manufacturers’ business outlook likely improved for a second straight quarter in March to its strongest since mid-2015, buoyed by a weak yen and a pickup in exports. European markets were trading in red weighed down by losses among miners and a slump in insurer Old Mutual and other South African-exposed stocks.

Back home, select fertilizers stocks like Zuari Agro, National Fertilisers, RCF and GSFC closed in green ahead of a Cabinet meeting scheduled to discuss change in urea subsidy. The Cabinet meeting will be held to discuss changes to urea subsidy for production in excess of reassessed capacity.

The BSE Sensex ended at 29609.06, down by 38.36 points or 0.13% after trading in a range of 29552.61 and 29687.64. There were 12 stocks advancing against 18 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.77%, while Small cap index was up by 0.69%. (Provisional)

The top gaining sectoral indices on the BSE were Energy up by 2.55%, Oil & Gas up by 1.82%, Metal up by 1.14%, PSU up by 0.95% and Basic Materials up by 0.91%, while Telecom down by 0.99%, Bankex down by 0.65%, IT down by 0.47%, Realty down by 0.47% and TECK down by 0.46% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were Reliance Industries up by 3.92%, NTPC up by 1.56%, Maruti Suzuki up by 1.43%, SBI up by 1.16% and Mahindra & Mahindra up by 0.98%. (Provisional)

On the flip side, Axis Bank down by 1.90%, HDFC Bank down by 1.42%, ICICI Bank down by 1.39%, HDFC down by 1.24% and Hindustan Unilever down by 0.99% were the top losers. (Provisional)

Meanwhile, after the Loksabha approval, the GST rollout looks imminent from July 1 and there are hopes that it will give a huge boost to economic activity in almost all sectors of Indian economy. Economic Affairs Secretary Shaktikanta Das has said that GST is an outcome of hard work done over last many years and it would remove the shadow economy. Das has also said that the tax net will be widened under the new regime and this may result in reduction of general tax rate.

Noting that GST is a very transformative piece of legislation, Das has said that it will definitely give a boost to the real economy at the expense of the parallel shadow economy and added that the indirect tax regime would also raise gross domestic product (GDP) growth by 1.5-2 percentage points.

Regarding revenue losses once the GST comes into place, Shaktikanta Das said that states might lose revenue in initial years, but the revenue inflows will stabilise even in the medium term and noted that he would not expect the revenue losses to continue beyond the first three years. He said that in any case if it happens, then there is a compensation mechanism for the first five years to compensate the states.

The CNX Nifty ended at 9170.70, down by 3.05 points or 0.03% after trading in a range of 9152.10 and 9191.70. There were 26 stocks advancing against 25 stocks declining on the index. (Provisional)

The top gainers on Nifty were Reliance Industries up by 3.92%, Indian Oil Corporation up by 2.71%, Hindalco up by 2.23%, ACC up by 2.19% and NTPC up by 1.53%. (Provisional)

On the flip side, Bharti Infratel down by 3.52%, HDFC Bank down by 1.79%, ICICI Bank down by 1.78%, Grasim Industries down by 1.69% and Axis Bank down by 1.69% were the top losers. (Provisional)

The European markets were trading in red; UK’s FTSE 100 decreased 34.63 points or 0.47% to 7,334.89, Germany’s DAX decreased 5.43 points or 0.04% to 12,251.00 and France’s CAC decreased 12.83 points or 0.25% to 5,076.81.

Most of the Asian markets ended mostly in red on Friday, as investors digested a raft of regional economic data and looked ahead to next week's highly anticipated meeting between the leaders of US and China. Concern grew in the region after US President Donald Trump said that the meeting with China “will be a very difficult one in that we can no longer have massive trade deficits and job losses.” Earlier in the day, the Chinese market moved higher after official data showed activity in China's vast manufacturing sector expanded at a faster pace than expected in March with a PMI score of 51.8, beating forecasts for 51.7 and up from 51.6 in February. The Japanese market lost all the early gains and ended at their lowest levels in more than seven weeks as exporters lost ground despite a weaker yen and upbeat domestic data. Japan's core consumer price inflation rose for a second consecutive month in February.