Final hour buying helps Sensex to regain 32K mark; Nifty reclaims 9,900 level

Buying in final hour of trade helped markets to end the session with gain of around half a percent, with frontline gauges recapturing their crucial 32,000 (Sensex) and 9,900 (Nifty) bastions. Markets started the day on optimistic note with traders taking some encouragement with an Asian Development Bank’s (ADB) supplement report stating that India is expected to achieve the projected growth rate of 7.4% in 2017 and further up 7.6% next year on strong consumption demand, with South Asia leading the growth chart in Asia and the Pacific. Upbeat earnings from market heavyweight Reliance Industries too aided sentiments with company reporting a consolidated quarterly net profit increase of 28%, helped by higher-than-expected refining and petrochemicals margins and a one-time gain. Net profit rose to Rs 9,079 crore in the quarter ended June from Rs 7,077 crore a year earlier. Revenue rose to Rs 92,661 crore, an increase of 25.5% from Rs 73,829 crore a year ago.

Markets in the second half took U-turn and entered into red terrain, as anxiety spread among the investors with ADB’s statement that the goods and services tax is expected to boost growth in the medium term, however there may be some teething pains as firms adjust to the new system. Domestic bourses even went to test psychological 31,800 (Sensex) and 9,850 (Nifty) levels, but the key gauges got some support near those intraday low levels as they trim their losses from thereon and ended near intraday high levels, as investors continued hunt for fundamentally strong stocks. Some support also came with the private report stating that strong import growth in June points to continued recovery in India’s domestic demand and highlighted that economic expansion will accelerate from the April-June quarter.

On the global front, European markets were trading mostly in red in early deals, as a fresh flow of corporate earnings failed to change the mood of the previous session, dragged down by the European Central Bank’s policy meeting, which pushed the euro close to a two-year high. Asian markets ended mostly in negative terrain on Friday, with Hong Kong’s Hang Seng Index closing in red.

Back home, stocks related to realty counter edged lower despite reports that foreign investment in Indian real estate sector jumped more than two-fold at $ 7.6 billion during 2014-16 period compared with the previous three years. US accounted for more than 40% of the foreign investments, followed by Canada (18%) and Singapore (17%). Telecom stocks Bharti Airtel, Idea cellular, Reliance Communications, MTNL and Tata Teleservices (Maharashtra) closed in red after Reliance Industries’ Chairman and Managing Director Mukesh Ambani announced the launch of much-awaited 4G feature phone at the company’s 40th annual general meeting. DTH & Digital Cable TV Providers such as Dish TV India and Hathway Cable & Datacom too closed in red on Jio’s New TV-Enabled Phone.

The NSE’s 50-share broadly followed index Nifty gained by over forty points to end above its psychological 9,900 support level, while Bombay Stock Exchange’s Sensitive Index -- Sensex surged by over one hundred and twenty points to end above its crucial 32,000 mark. However, the broader markets underperformed benchmarks and ended the session mixed. The market breadth remained in favour of decliners, as there were 1,277 shares on the gaining side against 1,407 shares on the losing side, while 134 shares remain unchanged.

Finally, the BSE Sensex surged 124.49 points or 0.39% to 32,028.89, while the CNX Nifty was up by 41.95 points or 0.42% to 9915.25.

The BSE Sensex touched a high and a low of 32,062.23 and 31,808.93, respectively and there were 14 stocks on gaining side as against 17 stocks on losing side on the index.

The broader indices ended mixed; the BSE Mid cap index rose 0.04%, while Small cap index was down by 0.05%.

The top gaining sectoral indices on the BSE were Energy up by 2.24%, IT up by 1.66%, TECK up by 1.26%, Consumer Durables up by 1.09% and Oil & Gas was up by 0.99%, while Realty down by 1.10%, Telecom down by 1.04%, Healthcare down by 0.54%, Power down by 0.42% and Capital Goods was down by 0.32% were the top losing indices on BSE.

The top gainers on the Sensex were Wipro up by 6.47%, Reliance Industries up by 3.76%, Coal India up by 2.66%, TCS up by 1.87% and Kotak Mahindra Bank up by 1.86%. On the flip side, Bharti Airtel down by 2.05%, Lupin down by 1.99%, Power Grid down by 1.85%, Hero MotoCorp down by 1.34% and Cipla down by 0.96% were the top losers.

Meanwhile, Union Minister of Finance, Defence and Corporate Affairs, Arun Jaitley has released the National Trade Facilitation Action Plan (NTFAP) on July 20, 2017. After releasing this National Action Plan, he said that the entry into force of the WTO-Trade Facilitation Agreement (TFA) on February 22, 2017 is a major milestone for the global trading system. He also said that India looks forward to ensuring compliance with the TFA and also impetus to trade facilitation. 

The minister has said that the NTFAP gives a time bound map, not only for implementing TFA, but also for the country’s initiatives for trade facilitation and ease of doing business which goes beyond TFA. Adding further, he said that the aim of the action plan is to transform cross border clearance ecosystem through efficient, transparent, risk based, coordinated, digital, seamless and technology driven procedures which are supported by state-of-the-art sea ports, airports and land borders.

Jaitley further stated that the objectives to be achieved by National Action Plan are improvement in ease of doing business by reduction in cargo release time and cost, move towards paperless regulatory environment, transparent and predictable legal regime and improved investment climate through better infrastructure. He also noted that the action plan lists out specific activities which would be carried out by all regulatory agencies like Customs, FSSAI, Drug Controller, Plant Quarantine, DGFT etc in time bound manner. He added that this co-ordination among all the stakeholders is needed to achieve the objective of trade facilitation.

The CNX Nifty traded in a range of 9,924.70 and 9,838.00. There were 26 stocks in green as against 25 stocks in red on the index.

The top gainers on Nifty were Wipro up by 6.28%, Reliance Industries up by 3.67%, Zee Entertainment up by 3.17%, Coal India up by 2.76% and HCL Tech up by 2.18%. On the flip side, Bharti Airtel down by 2.02%, Lupin down by 1.99%, Indiabulls Housing Finance down by 1.84%, Power Grid Corporation down by 1.55% and Hero MotoCorp down by 1.28% were the top losers.

The European markets were trading mostly in red; Germany’s DAX decreased 48.21 points or 0.39% to 12,399.04 and France’s CAC was down by 24.32 points or 0.47% to 5,174.90, while UK’s FTSE 100 was up by 2.56 points or 0.03% to 7,490.43.

Asian equity markets ended mostly in red on Friday after the European Central Bank dropped no hints at tapering in September and media reports suggested that US special counsel Robert Mueller is expanding the Russia probe to include President Donald Trump's business dealings. Japan's Nikkei share average edged down as investors took profits on steelmakers, offsetting gains in Yaskawa Electric and other machinery makers. Meanwhile, China's stocks fell on Friday but ended the week higher, with demand for blue chips gaining momentum amid a slump in small-cap stocks, as investors sought firms with solid growth prospects and lower valuations. Hong Kong stocks snapped a nine-day winning streak as investors took a breather after the benchmark index scaled a fresh two-year peak in the previous session. Though, Seoul stocks ended up at fresh record highs as foreign investors scooped up financial shares on expectations of solid second-quarter earnings results.