Post Session: Quick Review

Indian equity benchmarks traded in green throughout the day and ended the session mildly higher with Nifty surpassing 10,000 mark. The market breath was in favour of advances with 3 stocks advancing, while 2 stocks were declining on the bourses. The benchmarks made an optimistic start and traded in fine fettle in early deals as sentiments remained upbeat with RBI Governor Urjit Patel’s statement that the economy is recovering, after growth slowed to a three-year low of 5.7 percent in the April-June quarter. He added that the GDP growth will pick up in the third and fourth quarters (of the current fiscal year) to above 7 per cent. Some support also came with Agriculture secretary Shobhana K Pattanayak’s statement that India is headed for a good rabi season despite below normal monsoon rains, thanks to a surge of rainfall in the last week of September that replenished soil moisture. The secretary added that the late rains will benefit planting of rabi crops such as wheat and chana. Separately, SBI research report highlighted that India has been reasonably successful in reducing corruption, which has had a positive impact on its economic growth. The research paper shows that between 2011 and 2016, countries, such as India, UK, Portugal and Italy, have not only succeeded in improving their overall rank in corruption perception index, but also achieved GDP growth despite slowdown in the world economy. India has improved its overall rank the most from 95 in 2011 to 79 in 2016.

The upsides was, however, capped after the Reserve Bank of India (RBI) released data that indicates pessimism reigns among consumers and there is less hope for improvement in general economic conditions compared to last year. The RBI’s results of the September 2017 round of the Consumer Confidence Survey, reflecting households’ perceptions and expectations on the general economic situation, the employment scenario, the overall price situation and their own income and spending, showed the Current Situation Index waned further into the pessimistic zone.  Realty stocks were under pressure on report that launches of new homes in top eight cities came down by 33% to 60,140 units in January- September, hit by demand slowdown, but supply of affordable homes rose 27%.  All cities, barring Mumbai, saw a decline in new launches, mostly due to the introduction of RERA and GST implementation.

On the global front, Asian markets closed mixed. Bank of Japan Governor Haruhiko Kuroda reiterated the central bank’s resolve to maintain its massive stimulus program until inflation moved stably above its 2 percent price target. He also said inflation was likely to gradually accelerate towards 2 percent due to improvements in the output gap and inflation expectations. The European markets were trading mostly lower amid ongoing political uncertainty in the Catalonia region of Spain. Repercussions following the Catalonia region of Spain’s recent bid for secession have been seen from the central government in Madrid.

Back home, auto stocks were buzzing in today’s trade on report that India’s commercial vehicles sales in September rose at the fastest pace in nearly six years, suggesting a recovery in the economy. According to data released by the Society of Indian Automobile Manufacturers (SIAM), manufacturers dispatched 77,195 commercial vehicles, 25.27% more from a year earlier, to dealerships in the past month.

The BSE Sensex ended at 31904.51, up by 57.62 points or 0.18% after trading in a range of 31896.90 and 31994.77. There were 19 stocks advancing against 12 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.66%, while Small cap index was up by 0.99%. (Provisional)

The top gaining sectoral indices on the BSE were Utilities up by 1.01%, Telecom up by 0.94%, Power up by 0.92%, Energy up by 0.82% and IT up by 0.69%, while Realty down by 1.04% and FMCG down by 0.22% were the only losing indices on BSE. (Provisional)

The top gainers on the Sensex were Lupin up by 2.15%, Power Grid up by 1.61%, Axis Bank up by 1.57%, Coal India up by 1.47% and Reliance Industries up by 1.41%. (Provisional)

On the flip side, Hindustan Unilever down by 1.23%, Tata Steel down by 0.88%, ITC down by 0.86%, ICICI Bank down by 0.75% and Tata Motors - DVR down by 0.59% were the top losers. (Provisional)

Meanwhile, highlighting the smooth transition of the recently introduced Goods and Services Tax (GST), Finance Minister Arun Jaitley has said the new tax regime transition has been fairly smooth for states as they are adopting it at a fast pace despite attempts to derail its implementation. The FM further expressed optimism about the country and noted that global integration of Indian economy is happening at a time when other economies are becoming more protectionist.

Jaitley said that under the GST the government has unveiled attractive schemes to ensure that the non-compliant in India become compliant. He added that the lowest slab in India is five per cent, which doesn't exist anywhere in the world. That is because of the non-compliant tax character of the Indian society. You make it easy for people to enter the taxation system that you are able to expand. In the GST, for up to 10 million turnover we now have a scheme for them.

Arun Jaitley also highlighted the government's other initiatives like easing FDI norms and Digital India Programme, while asserting that India is now a better place to do business on the back of such initiatives. He also ensured that India is now becoming capable of taking big decisions and implementing them at a large-scale. Besides, Finance Minister noted improvements of infrastructure and power sectors, by saying that as many as 250 highways projects are under construction and the country is now having surplus power along with capacity of Indian ports have been expanded.

The CNX Nifty ended at 10013.60, up by 24.85 points or 0.25% after trading in a range of 10002.30 and 10034.00. There were 31 stocks advancing against 19 stocks declining on the index. (Provisional)

The top gainers on Nifty were UPL up by 3.61%, Lupin up by 2.26%, Bharti Airtel up by 2.07%, Power Grid up by 1.92% and IndusInd Bank up by 1.65%. (Provisional)

On the flip side, Ambuja Cement down by 1.12%, Eicher Motors down by 1.12%, Hindustan Unilever down by 1.09%, Indian Oil Corporation down by 1.00% and ITC down by 0.93% were the top losers. (Provisional)

The European markets were trading mostly in red; Germany’s DAX decreased 21.13 points or 0.16% to 12,955.27, France’s CAC decreased 5.51 points or 0.1% to 5,360.32, while UK’s FTSE 100 increased 7.54 points or 0.1% to 7,515.43.

Asian equity markets made a mixed closing on Tuesday as investors assessed political developments in Washington and awaited cues from the US earnings season as well the minutes from the most recent Federal Reserve meeting due this week for direction. The dollar treaded water on worries over North Korean provocations and amid diminished risk appetite after a top Republican senator sparred verbally with US President Donald Trump. Investors also kept an eye on developments in Catalonia as its President prepares to address the region's parliament on independence. Chinese shares erased early losses to end higher after reports that the government is making efforts to restrain market swings before a key leadership reshuffles this month. Japanese shares rose to close near their highest level in 21 years after the yen weakened over the weekend and Japan's current account surplus figures for August exceeded expectations. Meanwhile, Taiwan markets were closed for a public holiday.