Benchmarks hit fresh record highs; Nifty surpasses 10,300 mark

Extending their northward journey for fourth straight session, Indian equity benchmarks ended the F&O expiry day in green terrain, hitting fresh record highs with Sensex and Nifty surpassing their crucial 33,100 and 10,300 levels for the first time, respectively. Markets started on sluggish note, as sentiments remained dampened with Chief Economic Adviser Arvind Subramanian’s statement that bad loans and stressed assets in Indian Banks are estimated at Rs 10 lakh crore ($153.49 billion). Traders also remained on sidelines with a recent poll showing 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.

However, domestic gauges took U turn and entered into green terrain in noon deals to end near intraday highs, as traders turned optimistic with DIPP Secretary Ramesh Abhishek stating that India’s ranking may improve significantly in the World Bank’s ease of doing business report on the back of reforms initiated by the government. He also said that the introduction of GST is bound to be a ‘gamechanger’ for India’s economy despite the expected initial hiccups, which are being addressed by the government. Some support also came with private report stating that the recapitalisation programme for public sector banks is likely to boost equity market sentiment as it fuels growth recovery hopes, but should be followed up with structural changes at such banks for better results.

Firm opening in European counters too aided sentiments with CAC, DAX and FTSE trading in green in early deals 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. Asian markets exhibited mixed trend, as investors also digested regional corporate earnings results and looked for direction from the European Central Bank policy meeting, due later in the day.

Back home, 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. On the sectoral front, steel stocks shine during the trade, 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. However, aviation stocks ended mostly in red despite reports that Airlines in India carried 95.83 lakh passengers in September, up 16.34% from last September. The January to September passenger traffic was also higher compared to the previous year.

Finally, the BSE Sensex surged 104.63 points or 0.32% to 33,147.13, while the CNX Nifty was up by 48.45 points or 0.47% to 10,343.80.

The BSE Sensex touched a high and a low of 33,196.17 and 32,835.06, respectively and there were 17 stocks on gaining side as against 14 stocks on losing side on the index.

The broader indices ended in green; the BSE Mid cap index gained 0.52%, while Small cap index was up by 0.57%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 2.19%, Metal up by 2.07%, Energy up by 1.59%, Capital Goods up by 1.26% and PSU up by 1.26%, while Consumer Durables down by 0.78%, Telecom down by 0.58% and TECK was down by 0.09% were the few losing indices on BSE.

The top gainers on the Sensex were Cipla up by 3.18%, Maruti Suzuki up by 2.60%, Axis Bank up by 2.48%, Tata Steel up by 1.72% and Larsen & Toubro up by 1.68%. On the flip side, ICICI Bank down by 2.08%, Tata Motors - DVR down by 1.75%, Power Grid down by 1.65%, SBI down by 1.25% and Asian Paints down by 0.96% were the top losers.

Meanwhile, with a view to support startups in the oil and gas sector for a period of three years, as many as 10 public sector undertakings (PSUs) under the Ministry of Petroleum & Natural Gas, has unveiled a Rs 320 crore startup fund.  Union Petroleum Minister Dharmendra Pradhan has said that the oil sector PSUs have partnered with 36 projects (startups). He believes that this initiative would help promote innovation and new business models in the oil and gas sector. 

The minister further mentioned that the 10 state-run firms running the initiative are IndianOil, Hindustan Petroleum, Bharat Petroleum, Oil India, ONGC, Engineers India, Numaligarh Refinery, Gas Authority of India, Balmer Lawrie and Mangalore Refinery and Petrochemicals. He pointed out that India will offer investment opportunities worth $300 billion in oil sector over next 10 years so as to keep pace with the country's energy demand. In an apparent reference to the government's planned initiative on waste-to-wealth (energy) projects, he said that rag picking would be big business in the coming days.

Pradhan also indicated that the government has provided 3 crore LPG connections to poor households in 15 months and in the next 15 months, 4 crore families would be provide electricity connections under the Pradhan Mantri Sahaj Bijli Har Ghar Yojana - 'Saubhagya'. He also expressed hope that the burden of oil imports would reduce in the coming days, and added that if oil imports worth Rs 1 lakh crore are avoided then it would be a big boost for the country.

The CNX Nifty traded in a range of 10,355.65 and 10,271.85. There were 33 stocks in green as against 17 stocks in red on the index.

The top gainers on Nifty were BPCL up by 5.15%, HPCL up by 3.78%, Indian Oil Corporation up by 3.77%, Cipla up by 3.60% and Hindalco up by 2.91%. On the flip side, HCL Tech down by 4.64%, ICICI Bank down by 2.81%, Indiabulls Housing Finance down by 2.25%, SBI down by 2.03% and Ambuja Cement down by 2.01% were the top losers.

European markets were trading mostly in green; UK’s FTSE 100 increased 25.8 points or 0.35% to 7,473.01, France’s CAC gained 26.81 points or 0.5% to 5,401.70 and Germany’s DAX was up by 45.93 points or 0.35% to 12,999.34.

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.