Post Session: Quick Review

Indian equity benchmarks traded with traction throughout the day and ended the session with gain of more than one percent. The benchmarks traded jubilantly in early deals as sentiments remained up-beat on World Bank report that India has jumped 30 spots to number 100 in the latest Ease of Doing Business report for 2018. The report highlighted that India stands out this year as one of the 10 economies that improved the most in the areas measured by Doing Business. The report, which ranks New Zealand, Singapore and Denmark as the easiest countries in the world to do business in, ranked China at 78, which is 22 spots above India. The report also recognized India as one of the top 10 improvers in this year’s assessment, having implemented reforms in eight out of 10 Doing Business indicators. Describing as significant the huge improvement in India’s position in the World Bank’s ease of doing business ranking, a top US-India business advocacy group said this would help the country attract more FDI. Additionally, core sector growth hit a six-month high in September. The index of eight core industries - coal, crude oil, natural gas, refinery products, fertilisers, steel, cement, and electricity - was up 5.2% in September, compared with 4.4% in August and 5.3% in September last year.

Separately, India’s fiscal deficit at the end of the first half of the current fiscal touched 91.3% of the budget estimate, mainly due to rise in expenditure. In absolute terms, the fiscal deficit was Rs 4.99 lakh crore during the April-September period of 2017-18. During the same period of last financial year, 2016-17, the deficit was at 83.9% of the target. Some support also came from, Economic Affairs Secretary Subhash Chandra Garg’s statement that the government is hopeful of sticking to the 3.2 per cent fiscal deficit target for the current fiscal, although a final view would be taken in December. Investors took note that India could review the application of the highest 28% slab under the Goods and services Tax (GST) and consider imposing a lower rate on items of frequent use. Items in the 28% slab include washing machines, refrigerators, electrical fittings, cement, ceiling fans, watches, automobiles, tobacco products, nutritional drinks, auto parts, plastic furniture and plywood. Some of the goods placed in that bracket are manufactured by MSMEs and they are feeling some pressure.

On the global front, Asian markets closed mostly in green. Soaring memory chip sales helped South Korea exports record 12 consecutive months of growth in October, evidence Asia’s fourth largest economy is stepping up a gear. While shipments growth moderated from September, October outpaced September in terms of average exports per working day, highlighting brisk business activity. The European markets were trading in green, despite a terrorist attack in New York, as investors focused on earnings reports. The UK manufacturing sector continued to expand at a solid pace at the start of the fourth quarter.

The BSE Sensex ended at 33603.23, up by 390.10 points or 1.17% after trading in a range of 33340.62 and 33651.52. There were 18 stocks advancing against 13 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.34%, while Small cap index was up by 0.44%. (Provisional)

The top gaining sectoral indices on the BSE were Telecom up by 4.08%, Realty up by 2.44%, Bankex up by 2.05%, Metal up by 1.80% and FMCG up by 1.32%, while Consumer Durables down by 0.71%, Healthcare down by 0.27%, Utilities down by 0.26%, IT down by 0.23% and Power down by 0.22% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Bharti Airtel up by 8.91%, SBI up by 4.87%, ICICI Bank up by 4.28%, HDFC up by 2.46% and Axis Bank up by 2.00%. (Provisional)

On the flip side, Dr. Reddy’s Lab down by 3.06%, Power Grid down by 1.25%, Sun Pharma down by 1.03%, Hero MotoCorp down by 1.03% and Bajaj Auto down by 0.64% were the top losers. (Provisional)

Meanwhile, amid subdued demand conditions due to negative impacts of Goods and Services tax (GST), India’s manufacturing sector growth lost its momentum in the month of October. The seasonally adjusted Nikkei India Manufacturing Purchasing Manger’s Index (PMI) - a composite single-figure indicator of manufacturing performance - slowed down to 50.3 in October from 51.2 in September, indicating stagnation in the health of the manufacturing sector. However, the reading signaled an expansion for the third consecutive month, remaining above the no-change mark of 50.0.

As per the survey report, fractional rise witnessed in output, while new export orders for Indian goods reduced in October at fastest rate since September 2013. The report further added that employment increased for the third consecutive month in October due to greater outstanding business but the increment was modest and broadly unchanged from September’s recent high.

On the inflation front, input costs remained higher by rising at the fastest pace since May, while output prices rose in October as the companies attempted to pass on higher cost burdens to clients and to protect profit margins. The report further noted that purchasing activity fell marginally for the first time in three months and the reduction also witnessed in pre-production stocks.

The CNX Nifty ended at 10440.60, up by 105.30 points or 1.02% after trading in a range of 10383.05 and 10451.65. There were 29 stocks advancing against 21 stocks declining on the index. (Provisional)

The top gainers on Nifty were Bharti Airtel up by 9.21%, SBI up by 4.73%, ICICI Bank up by 4.57%, Vedanta up by 3.45% and Hindalco up by 3.09%. (Provisional)

On the flip side, Eicher Motors down by 4.04%, Bharti Infratel down by 3.83%, Dr. Reddy’s Lab down by 3.01%, UPL down by 2.16% and HCL Tech down by 1.73% were the top losers. (Provisional)

The European markets were trading in green; UK’s FTSE 100 increased 10.7 points or 0.14% to 7,503.78, Germany’s DAX increased 180.52 points or 1.36% to 13,410.09 and France’s CAC increased 28.29 points or 0.51% to 5,531.58.

Asian equity markets ended mostly higher on Wednesday, lifted by optimism over global economic growth and corporate earnings. Data showed that US consumer confidence in October rose to its highest level in nearly 17 years and as China's Caixin manufacturing Purchasing Managers' Index for October matched expectations. Meanwhile, the US Federal Reserve is also likely to be in focus, with the central bank due to announce its latest monetary policy decision later in the day. While the Fed is expected to leave interest rates unchanged, investors will be looking for clues about the possibility of a rate hike in December. Japanese shares ended higher, cheered by booming profits for Japan Inc. including exporters such as Sony and Nitto Denko.