Bulls back on Dalal Street after a day off; Sensex ends shy of 32k mark

Indian equity benchmarks once again back on track with frontline gauges, erasing most of their previous session losses, settled almost at 32,000 (Sensex) and 9,900 (Nifty) levels. Markets traded with full traction throughout the session, as sentiments remained up-beat with NITI Aayog Vice Chairman Arvind Panagariya’s statement that India’s GDP could rise to about $8 trillion over the next 15 years if the country registers an economic growth of 8 percent annually and come very close to eliminating abject poverty entirely. Traders also took some encouragement with rating agency Fitch’s latest report stating that new indirect tax regime Goods and Services Tax (GST) is likely to be beneficial for auto, cement and organised retail sectors, but will have a negative impact on oil and gas, and SME sectors.

Rally got extended in last leg of trade with private report stating that India will reclaim its position as the fastest growing major global economy this year, partly propelled by benefits from a new tax system and bolstered by an expected central bank interest rate cut. Finance Minister Arun Jaitley’s statements that the GST is a win- win deal for all as it will expand the tax net, end inspector raj and bring down prices of goods too supported the sentiments.

Positive opening in European counters too aided sentiments, as investors took stock of a series of corporate announcements from across the continent. Asian markets ended mostly in green, with China turning around after a few days of losses. A poll found Japanese manufacturers and service providers’ business confidence held steady at high levels in July, underlining the central bank’s upbeat view on the economy.

Back home, pharma stocks remained on buyers’ radar on report that the government is looking at introducing a new National Pharmaceuticals Policy and is already in the process of working out details. The oil & gas stocks too remained in action, as the government is likely to consider the sale of government's 51.11 per cent stake in Hindustan Petroleum Corp (HPCL) to Oil and Natural Gas Corporation (ONGC) for over Rs 28,000 crore.

Moreover, telecom stocks Bharti Airtel, Idea Cellular, Reliance Communications, MTNL and Tata Tele (Maharashtra) rang loud with major telcos push for doubling mobile call termination charge. Bharti Airtel, Vodafone and Idea Cellular -- sought doubling of interconnection usage charge (IUC), a key input for mobile tariffs, saying that terminating incoming calls on their networks costs 30-35 paise per minute.

The NSE’s 50-share broadly followed index Nifty gained by over seventy points to end tad below its psychological 9,900 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex surged by over two hundred and forty points to end near its crucial 32,000 mark. The broader markets too traded with traction and ended the session with a gain of around a percent. The market breadth remained in favour of advances, as there were 1,714 shares on the gaining side against 971 shares on the losing side, while 168 shares remain unchanged.

Finally, the BSE Sensex surged 244.36 points or 0.77% to 31,955.35, while the CNX Nifty was up by 72.45 points or 0.74% to 9,899.60.

The BSE Sensex touched a high and a low of 31,978.89 and 31,793.72, respectively and there were 25 stocks on gaining side as against 6 stocks on losing side on the index.

The broader indices ended in green; the BSE Mid cap index soared 1.01%, while Small cap index was up by 0.99%.

The top gaining sectoral indices on the BSE were Telecom up by 3.08%, Metal up by 1.95%, Healthcare up by 1.78%, Realty up by 1.50% and FMCG was up by 1.49%, while there were no losers on the BSE sectoral front.

The top gainers on the Sensex were Bharti Airtel up by 3.22%, Coal India up by 2.66%, ITC up by 2.42%, Dr. Reddy’s Lab up by 2.01% and TCS up by 1.88%. On the flip side, Hero MotoCorp down by 0.74%, Infosys down by 0.56%, Hindustan Unilever down by 0.46%, Adani Ports & SEZ down by 0.37% and ICICI Bank down by 0.18% were the top losers.

Meanwhile, expressing optimism over growth of Indian economy, NITI Aayog Vice Chairman Arvind Panagariya has said the country’s gross domestic product (GDP) could touch $8 trillion over the coming 15 years by maintaining 8 percent growth annually. With the current level of growth, he noted that living standards and amenities that are taken for granted by Western countries could become available to a very large part of the Indian population in the next 15 years.

Panagariya stated that today, India has left China behind in the race to the world's fastest growing economy and it grew in real dollars in the previous 15 years ending 2016-17 (at) about 9 percent. Adding further, he said that if one were to make a very conservative assumption that over the next 15 years, India would grow 8 percent, GDP would increase from 2.3 trillion dollars today to close to about $8 trillion, with an average income of over $5,000. He also clarified that at that level of income it is not simply that the country will be very close to ending mass poverty entirely but a large part of the population will be very prosperous.

He further said that currently, the Indian economy is experiencing much more stable growth and added that there are some of the legacy issues such as the non- performing assets of the banks and they are being tackled by the government. He added that inflation is down to below two percent and the government has systematically cut the fiscal deficits. Highlighting government’s various reforms initiatives such as the Goods and Services Tax (GST), Insolvency and Bankruptcy Act and the Aadhar Act, Panagariya said that the benefits of those reforms are just starting to show.

The CNX Nifty traded in a range of 9,905.05 and 9,851.65. There were 41 stocks in green as against 10 stocks in red on the index.

The top gainers on Nifty were Aurobindo Pharma up by 4.30%, Bharti Airtel up by 3.17%, Hindalco up by 2.92%, Zee Entertainment up by 2.81% and Coal India up by 2.49%. On the flip side, Ultratech Cement down by 2.89%, ACC down by 1.42%, Bharti Infratel down by 0.73%, Ambuja Cement down by 0.62% and Infosys down by 0.58% were the top losers.

The European markets were trading in green; Germany’s DAX rose 6.63 points or 0.05% to 12,437.02, France’s CAC increased 9.3 points or 0.18% to 5,182.57 and UK’s FTSE 100 was up by 10.52 points or 0.14% to 7,400.74.

Asian equity markets ended mostly in green on Wednesday as investors remained optimistic about China's ongoing economic transition and looked ahead to policy statements from the European and Japanese central banks, due Thursday. The dollar stayed on the defensive on doubts over US President Donald Trump's ability to deliver tax reforms, while oil prices pulled back slightly on industry data showing a rise in US crude inventories. Chinese shares ended higher as investors piled into banking, consumer and resources shares after robust economic growth data earlier in the week and on expectations that Beijing is stepping up efforts to reform lumbering and inefficient state companies. Japanese shares closed marginally higher in choppy trade, with buying in defensive stocks offsetting worries about the impact of a stronger yen as the US dollar flounders.