Post Session: Quick Review

Indian equity benchmarks pared all of their initial losses and ended in green territory, with gains of around more than four tenth of a percent. Healthy buying in interest rate sensitive stocks, derivatives expiry and broadly positive global cues, buoyed the markets with Nifty and Sensex closing above 10,300 and 33,100 marks respectively. The benchmarks traded slightly in red in early deals as sentiments were dampened after on Wednesday Chief Economic Adviser Arvind Subramanian said that bad loans and stressed assets in Indian Banks are estimated at Rs 10 lakh crore ($153.49 billion). The government announced a Rs 2.11 lakh crore recapitalization plan for its state-owned banks over the next two years, in a bid by Prime Minister Narendra Modi to tackle a major drag on the economy that has frustrated his attempts to boost growth. Separately, a recent poll showed that India’s economy will likely grow at its slowest pace in four years this fiscal year, as a currency ban and the new Goods and Services Tax (GST) have disrupted business activity and dampened consumer demand. The poll enlightened that Asia’s third-largest economy will grow at 6.7 percent in the fiscal year ending March 2018, the slowest since the new methodology of measuring gross domestic product (GDP) was introduced in the 2014-15 fiscal year.

Some buying crept in after Arvind Subramanian, chief economic adviser (CEA) in the finance ministry, suggested that measures such as privatization, selective capital infusion into viable banks, and taking stressed loans off the balance sheet of banks will make the record bailout of state-owned banks, announced by finance minister Arun Jaitley, even more effective. Some support also came with S&P Global Ratings’ report highlighting that Rs 2.11 lakh crore capital infusion into PSU banks will help dealing with bloated balance sheet and enable banks to take haircuts on their non-performing loans.

Meanwhile, PSU banking stocks were under pressure in today’s trade as the government’s capital infusion for public sector banks means that consolidation of these lenders is now on the back burner and could be delayed to after elections in 2019. Select steel stocks were buzzing as India imposed anti-dumping duty on some cold-rolled flat products of stainless steel from China, the US, South Korea and the European Union, to curb the influx of cheaper imports and help local producers. The duty, which will be in effect until 10 December 2020, exempts certain grades of stainless steel.

On the global front, Asian markets closed mixed. South Korea’s economy clocked its fastest growth in seven years last quarter, as global demand for the country’s electronics more than offset the impact of regional geopolitical strains on trade and boosted expectations for an imminent interest rate rise. Gross domestic product rose 1.4 percent in the third quarter from the previous quarter. The European markets were trading in green ahead of the European Central Bank’s monetary policy decision later in the day. ECB chief Mario Draghi is expected to announce a gradual reduction in the massive monetary stimulus as the euro area economic growth gains momentum.

Back home, Polaris Consulting & Services was locked at upper circuit after the IT Company told stock exchanges that its board would meet on October 31 to consider delisting of its equities. The company said it will appoint a SEBI registered merchant banker for carrying out due diligence as required in terms of Regulation of the SEBI delisting Regulations. Jaiprakash Associates plunged after the Supreme Court on Wednesday declined to allow the company to hive-off the rights of multi-crore six-lane Yamuna Expressway connecting Greater Noida with Agra in Uttar Pradesh.

The BSE Sensex ended at 33192.78, up by 150.28 points or 0.45% after trading in a range of 32835.06 and 33196.17. There were 16 stocks advancing against 15 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.58%, while Small cap index was up by 0.63%. (Provisional)

The top gaining sectoral indices on the BSE were Oil & Gas up by 2.30%, Metal up by 2.10%, Energy up by 1.76%, PSU up by 1.40% and Capital Goods up by 1.30%, while Telecom down by 0.90% and Consumer Durables down by 0.63% were the only losing indices on BSE. (Provisional)

The top gainers on the Sensex were Cipla up by 3.78%, Maruti Suzuki up by 2.43%, Axis Bank up by 2.26%, Tata Steel up by 1.66% and Larsen & Toubro up by 1.64%. (Provisional)

On the flip side, ICICI Bank down by 2.65%, SBI down by 2.06%, Power Grid down by 1.79%, Tata Motors - DVR down by 1.62% and Asian Paints down by 1.05% were the top losers. (Provisional)

Meanwhile, Indian companies raised a whopping $3.28 billion debt from overseas markets in the month of September 2017 through external commercial borrowings (ECBs)/ foreign currency convertible bonds (FCCBs) which is higher than $1.56 billion debt raised in August this year.

According to the Reserve Bank of India (RBI) data, in September 2017, Power Grid Corporation of India, EXIM Bank, and NTPC figure among the companies which together raised $3.28 billion debt from overseas markets, while Housing Development Finance Corporation (HDFC) was the only one to raise $201 million through Rupee Denominated Bonds (RDB).

Power Grid and EXIM Bank raised funds amounting $ 500 million each, through ECB/FCCB, while NTPC and IOC raised $353.89 million and $300 million respectively. Besides, SAIL was also in the list of borrowers by raising $350 million. Going Further, Larsen & Toubro, Dassault Reliance Aerospace, Cadila Healthcare, Apollo Tyres, and Birla Corporation were the companies that raised funds through the ECB.

The CNX Nifty ended at 10336.30, up by 40.95 points or 0.40% after trading in a range of 10271.85 and 10355.65. There were 33 stocks advancing against 17 stocks declining on the index. (Provisional)

The top gainers on Nifty were BPCL up by 5.15%, HPCL up by 3.78%, Indian Oil up by 3.77%, Cipla up by 3.60% and Hindalco up by 2.91%. (Provisional)

On the flip side, HCL Tech down by 4.53%, ICICI Bank down by 2.81%, Ambuja Cement down by 2.31%, Indiabulls Housing down by 2.25% and SBI down by 2.00% were the top losers. (Provisional)

The European markets were trading in green; UK’s FTSE 100 increased 25.82 points or 0.35% to 7,473.03, Germany’s DAX increased 39.14 points or 0.3% to 12,992.55 and France’s CAC increased 16.68 points or 0.31% to 5,391.57.

Asian equity markets made a mixed closing on Thursday after US shares fell the most in seven weeks overnight in the wake of a string of disappointing earnings reports and rising bond yields. Investors also digested regional corporate earnings results and looked for direction from the European Central Bank policy meeting, due later in the day. Chinese shares ended higher after President Xi Jinping's vast ‘Belt and Road’ infrastructure project was included in the ruling Communist Party's constitution. Japanese shares eked out modest gains on earnings optimism and amid the prospect of further stimulus from the government.