Post Session: Quick Review

Indian equity benchmarks traded below neutral line throughout the day and ended in red for the third straight session tracking subdued global cues following correction in metals and crude oil prices. Oil prices tumbled continuing Tuesday’s slide after the International Energy Agency cast doubts over the past months’ narrative of tightening fuel markets. The market breath was in favour of declines with one stock advancing against four declining ones. The benchmarks traded in red in early deals as the sentiments were dampened after trade deficit widened to its highest in nearly three years in October, as export growth contracted for the first time after more than a year. The trade deficit widened to $14.02 billion last month from $8.98 billion in September. Merchandise exports for October fell 1.12% from a year earlier to $23.1 billion, dropping for the first time since August 2016.

Market participants failed to get relief from ASSOCHAM’s report that while there has been a temporary slowdown after GST implementation (in July 2017) a consensus view is that India is poised for a sustainable growth in the near future. The report maintained that GST will have a significant impact on all aspects of the businesses operating in the country including - supply chain, logistics, cash flows and transactions. Besides, investors also shrugged off the Central Board of Direct Taxes’ (CBDT) statement that it was not only confident that the Income Tax (IT) department would achieve Rs 9.80 lakh crore target of direct tax revenue collections for the financial year 2017-18, but that it would surpass it. CBDT Chairman Sushil Chandra has said that the net direct tax collections, which are made up of personal and corporate taxes, have been buoyant and very good.

On the global front, Asian markets closed in red, as the cautious sentiments from the last session continued, with energy-related plays in the region falling on weakening oil prices. Japan’s economy grew faster than expected in the third quarter due to strong exports, posting the longest period of uninterrupted growth in more than a decade. The economy expanded at a 1.4% annualized rate in July-September, slightly above the median estimate for annualized growth of 1.3%. The European markets were trading in red as a fall in commodity stocks and continued profit taking sent the shares to an eight-week low. The number of people in work in Britain fell by the most in more than two years in the three months to September, a latest sign of weakness in Britain’s Brexit-bound economy.

Back home, ADAG companies like Reliance Communications (RCom), Reliance Home Finance, Reliance Infrastructure, Reliance Nippon Asset Management,   Reliance Power and Reliance Capital closed in red after RCom defaulted on Dollar bonds. Separately, the National Company Law Appellate Tribunal (NCLAT) issued a notice to RCom over a petition filed by Manipal Technologies seeking its due. State Bank of India (SBI) and Punjab National Bank (PNB) also closed in red as they have got maximum exposure of debt to RCom.

The BSE Sensex ended at 32786.15, down by 155.72 points or 0.47% after trading in a range of 32683.59 and 32944.94. There were 7 stocks advancing against 24 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 0.85%, while Small cap index was down by 1.41%. (Provisional)

The top losing sectoral indices on the BSE were Metal down by 2.81%, Telecom down by 2.40%, Basic Materials down by 1.95%, Realty down by 1.65% and Utilities down by 1.63%, while there were no gainers on BSE sectoral front. (Provisional)

The top gainers on the Sensex were Asian Paints up by 2.84%, Kotak Mahindra Bank up by 1.15%, ICICI Bank up by 0.89%, Hero MotoCorp up by 0.53% and Infosys up by 0.27%. (Provisional)

On the flip side, Sun Pharma down by 4.01%, ONGC down by 2.53%, Bharti Airtel down by 2.35%, NTPC down by 1.75% and Lupin down by 1.50% were the top losers. (Provisional)

Meanwhile, pointing that revival of infrastructure sector is in the primitive stages, credit rating agency, ICRA in its latest report has said that infrastructure companies with exposure to airport and highway sectors are doing well by showing improvement in their operational and financial performance, however many infrastructure players are struggling with stressed balance sheet problem.

As per ICRA’s report, aggregate debt of infra companies at a standalone level as of March 2017 rose only marginally from March 2016, while at the consolidated level, debt declined by 12% year-on-year to Rs 1.39 lakh crore from Rs 1.58 lakh crore, on account of stake disinvestment in subsidiaries or projects by the infra companies.

The report also found that the order book position of most construction companies have improved to over three times their last reported annual revenues, with government’s efforts to improve the country’s  infrastructure. ICRA however noted that the sector continue to face funding issues, as banks are still grappling with high Non-Performing Assets woes.

The CNX Nifty ended at 10126.60, down by 60.00 points or 0.59% after trading in a range of 10094.00 and 10175.45. There were 13 stocks advancing against 37 stocks declining on the index. (Provisional)

The top gainers on Nifty were Asian Paints up by 2.78%, BPCL up by 2.27%, Ambuja Cement up by 2.03%, Tech Mahindra up by 1.89% and Eicher Motors up by 1.25%. (Provisional)

On the flip side, Bharti Infratel down by 4.85%, Vedanta down by 4.08%, Sun Pharma down by 3.98%, Hindalco down by 2.99% and UPL down by 2.74% were the top losers. (Provisional)

The European markets were trading in red; UK’s FTSE 100 decreased 36.55 points or 0.49% to 7,377.87, Germany’s DAX decreased 135.96 points or 1.04% to 12,897.52, and France’s CAC decreased 29.66 points or 0.56% to 5,285.92.

Asian equity markets ended lower on Wednesday as commodities declined on concerns over slowing growth in China and uncertainty prevailed over the fate of a US tax reform bill. Japanese shares ended lower as the yen surged broadly and economic data on industrial output and GDP painted a mixed picture of the economy. While Japan's industrial output declined less than initially estimated in September, GDP grew 0.3 percent sequentially in the third quarter of 2017, shy of expectations for a 0.4 percent gain and down from 0.6 percent in the second quarter, separate reports showed. Further, Chinese shares extended their losses, hurt by resources shares amid signs of a slowdown in industrial production as the nation’s economy enters a period of moderating growth.