Post Session: Quick Review

India equity benchmarks traded in green throughout the day and ended the session with gain of more than six tenth of a percent ahead of RBI monetary policy review. The central bank’s two-day monetary policy review begins today and the decision is due tomorrow. This has led to unabated buying by domestic financial institutions, which added to the positive mood. The benchmarks made a gap-up opening and traded in green in early deals as traders took some encouragement with Finance Minister Arun Jaitley’s statement that net collections till September 18 of this fiscal grew 15.7% to Rs 3.7 lakh crore. The number of taxpayers rose to 6.26 crore in 2016-17 from 4.72 crore in 2012-13. According to a finance ministry statement, some parliamentarians suggested that more searches be conducted against black money holders since many people are still transacting in black money. They also suggested lowering tax rate and changes to tax slabs. Jaitley indicated that the government would consider reducing the goods and services tax slabs and easing compliance burden for small taxpayers once revenues from GST better those from the previous tax regime. Some support also came after the Nikkei India Manufacturing Purchasing Managers’ Index, or PMI, remained unchanged at 51.2 in September. As per the report, September data painted an encouraging picture as the sector continued to recover from the disruptions caused by the introduction of the GST in July.

Investors took note that the Centre has begun a slew of measures to boost medium and small scale industries, exports and the textile sector. As per report, September 27 Cabinet meeting had discussed proposals related to providing stimulus to medium and small-scale industries, exports and the textile sector which have not performed to their optimum strength in last few quarters. Separately, expressing hopes about India’s Gross Domestic Product (GDP) growth recovery in the coming months, Former Reserve Bank of India (RBI) governor C Rangarajan said that the economy needs to pick up very fast to be able to maintain a healthy annual growth for the financial year 2017-18.

On the global front, Asian markets closed mostly higher. Japanese companies’ inflation expectations eased slightly in September from three months ago in a worrying sign the economy continues to struggle with a deflationary mindset. The European markets were trading in green as market sentiments remained strong despite the Las Vegas mass shooting late Sunday and ongoing political turmoil in Spain.

The BSE Sensex ended at 31488.72, up by 205.00 points or 0.66% after trading in a range of 31440.48 and 31615.28. There were 20 stocks advancing against 11 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.78%, while Small cap index was up by 0.45%. (Provisional)

The top gaining sectoral indices on the BSE were Consumer Durables up by 2.22%, Energy up by 1.55%, Oil & Gas up by 1.47%, FMCG up by 1.17% and Metal up by 1.13%, while Power down by 0.71%, Telecom down by 0.35% and Capital Goods down by 0.28% were the few losing indices on BSE. (Provisional)

The top gainers on the Sensex were Tata Motors - DVR up by 4.90%, Tata Motors up by 3.60%, Asian Paints up by 2.95%, Reliance Industries up by 2.15% and Bajaj Auto up by 1.87%. (Provisional)

On the flip side, Power Grid down by 2.37%, Maruti Suzuki down by 1.23%, Bharti Airtel down by 1.20%, Cipla down by 1.06% and SBI down by 0.85% were the top losers. (Provisional)

Meanwhile, indicating modest improvement in manufacturing sector’s business condition, India Manufacturing Purchasing Managers’ Index (PMI)-a composite single-figure indicator of manufacturing performance- remained unchanged for the month of September at 51.2. However, the reading signaled an expansion for the second consecutive month, remaining above the no-change mark of 50.0.

As per the report, the expansion in manufacturing activity of the country was on account of increase in output and new orders. However, the expansion rate remained weak in both cases, by easing slightly. Inflows of new orders increased for the second month in succession during September. The rate of growth softened from the preceding month and was marginal overall. The survey data further showed that Indian manufacturers raised their staffing levels at the fastest pace since October 2012 on the back of more new work orders, while noting decrease in new export orders.

On the inflation front, the report said that even if cost pressure intensified during September month due to Goods and Services Tax (GST) and greater prices for steel and petroleum products, inflation was modest, remaining below the long-run series average. Further, in order to protect margins amid higher inflationary pressures, firms raised their selling prices but at a marginal pace as amid competitive conditions, they couldn’t increase the prices more.

The CNX Nifty ended at 9854.80, up by 66.20 points or 0.68% after trading in a range of 9831.05 and 9895.40. There were 38 stocks advancing against 12 stocks declining on the index, while one stock remained unchanged. (Provisional)

The top gainers on Nifty were GAIL India up by 4.12%, Tata Motors up by 3.61%, Aurobindo Pharma up by 2.47%, Reliance Industries up by 2.32% and Indiabulls Housing up by 2.26%. (Provisional)

On the flip side, Power Grid down by 2.56%, Bharti Airtel down by 1.64%, Cipla down by 1.48%, Maruti Suzuki down by 1.39% and SBI down by 0.98% were the top losers. (Provisional)

The European markets were trading in green; UK’s FTSE 100 increased 3.21 points or 0.04% to 7,442.05, Germany’s DAX increased 73.79 points or 0.58% to 12,902.65 and France’s CAC increased 9.16 points or 0.17% to 5,359.60.

Asian equity markets ended mostly higher on Tuesday, tracking an overnight rally on Wall Street. The dollar was bolstered by upbeat US economic data and tax reform hopes while oil prices slipped further in Asian deals after falling more than 2 percent on Monday amid signs of higher output. Japanese shares rallied to hit two-year highs as the yen held weak in the wake of new data pointing to strength in the world's largest economy. Markets in South Korea and China remained closed for the Harvest Festival and National Day, respectively.