Bulls go brisk on Dalal Street; Sensex recaptures 33,100 level

Thursday turned out to be a remarkable day of trade for Indian equity benchmarks where bulls tightened their grip on Dalal Street, with Nifty and Sensex recapturing their crucial 10,200 and 33,100 levels, respectively. The markets’ mood remained up-beat throughout the day and benchmarks fervently gained from strength to strength to end near intraday high levels, as investors continued hunt for fundamentally strong stocks. Key gauges made a positive opening with Finance Minister Arun Jaitley’s statement that with greater digitisation and formalisation of financial activities and businesses, India is set to become an “extremely attractive” country to do business. He, however, acknowledged short-term challenges for the country in implementing strategic initiatives such as demonetisation and the GST. Adding to the optimism, Arun Jaitley said that India's economic slowdown has bottomed out and now it should start moving upwards after recovering from the temporary blip seen during the recent structural changes. The finance minister also assured investors of a strong banking sector in India.

Some support also came with Chief economic adviser (CEA) Arvind Subramanian’s statement that recent move by the Goods and Services Tax (GST) Council to cut tax on 178 items, though, will have marginal impact on the revenue but that will be compensated by compliance benefits. He also feels that fall in prices will also help keep inflation under control. Investors took note of a private survey which showed that Prime Minister Narendra Modi remains by far the most popular figure in Indian politics, releasing the main findings of its latest survey conducted among 2,464 respondents in India. The report enlightened that the public’s positive assessment of Modi is buoyed by growing contentment with the Indian economy: more than eight-in-ten say economic conditions are good.

Firm opening in European markets too aided sentiments with CAC, DAX and FTSE trading in green in early deals as the cyclical sectors which had driven a market-wide sell-off made a comeback. Retail sales in the UK rose more than expected in October, bolstering optimism over the British economy. Asian markets exhibited mixed trend as traders remained on sidelines ahead to the US House vote on a sweeping tax reform bill later today.

Back home, auto stocks remained on buyers’ radar with Centre’s announcement of the introduction of BS-VI grade automobile fuel in the national capital Delhi being advanced by two years to April 2018. Export oriented stocks remained buzzing, as the GSTN utility for exporters to claim refunds has been activated. With the new utility RFD-1A, a merchant exporter can claim refund of GST paid at the time of buying goods which he has exported in the relevant month.

Finally, the BSE Sensex soared 346.38 points or 1.06% to 33,106.82, while the CNX Nifty was up by 96.70 points or 0.96% to 10,214.75.

The BSE Sensex touched a high and a low of 33,165.15 and 32,829.82, respectively and there were 27 stocks on gaining side as against 4 stocks on losing side on the index.

The broader indices ended in green; the BSE Mid cap index surged 1.07%, while Small cap index was up by 1.10%.

The top gaining sectoral indices on the BSE were IT up by 2.16%, TECK up by 1.87%, Power up by 1.32%, Telecom up by 1.30% and Energy was up by 1.24%, while there were no losers on the BSE sectoral front.

The top gainers on the Sensex were Infosys up by 3.85%, SBI up by 2.54%, Reliance Industries up by 2.27%, NTPC up by 1.58% and TCS up by 1.49%. On the flip side, Adani Ports & SEZ down by 2.52%, Coal India down by 1.27%, Hero MotoCorp down by 0.38%, Cipla down by 0.10% and Bajaj Auto down by 0.09% were the top losers.

Meanwhile, the Ministry of Steel has said that it wants to bring down the import duty on stainless steel scrap to zero, along with ferro-nickel, after removal of import duty on nickel. In this regard, the steel ministry has already made a request to the finance ministry. Currently, both stainless steel scrap and ferro-nickel, key raw materials for stainless steel manufacturing, attract an import duty of 2.5%. 

Acknowledging the steps being taken by the ministry to protect the interests of domestic steel industry, president of industry body Indian Stainless Steel Development Association (ISSDA) K K Pahuja has said that if the import duty on ferro-nickel and stainless steel scrap is removed it will bring down the cost of production of stainless steel in the country. He also said that important elements like nickel and chromium are already present in stainless steel scrap, so the stainless steel industry will not need to get the two components, which will save time as well as cost of production. In addition, he noted that when stainless steel is made with mild steel, these two components are added, so, removal of import duty on stainless steel scrap along with ferro-nickel will be a win-win situation.

Adding further, Pahuja said that it will also create a new market for manufacturing of various stainless steel products such stainless steel pipes for use in water supply. He indicated that at present, in water supply galvanised steel pipes are used which catch leakages and are not corrosion-free so bacteria also develops in them and this leads to wastage of water and at times causes health issues. Besides, he said that the plastic pipes get crack and catch fungus and algae and added that introduction of stainless steel pipes in water supply and storage will address these issues. He noted that the life of stainless steel pipes will be more and maintenance cost will be near to zero.

The CNX Nifty traded in a range of 10,232.25 and 10,139.20. There were 37 stocks in green as against 13 stocks in red on the index.

The top gainers on Nifty were Infosys up by 4.01%, Bajaj Finance up by 3.73%, SBI up by 2.77%, Aurobindo Pharma up by 2.54% and Reliance Industries up by 2.44%. On the flip side, Adani Ports & SEZ down by 2.21%, Coal India down by 1.23%, Ultratech Cement down by 0.85%, BPCL down by 0.70% and ZEEL down by 0.46% were the top losers.

European markets were trading in green; UK’s FTSE 100 increased 13.38 points or 0.18% to 7,385.99, France’s CAC added 41.5 points or 0.78% to 5,342.75 and Germany’s DAX was up by 87.28 points or 0.67% to 13,063.65.

Asian equity markets ended mixed on Thursday as oil held steady, the yen weakened and investors looked ahead to the US House vote on a sweeping tax reform bill later today. Japanese shares ended higher, as buyers stepped back in for bargains following six straight days of losses, with SoftBank gaining after a report that it plans to invest as much as $25 billion in Saudi Arabia. Further, Hong Kong stocks firmed, helped by index heavyweight Tencent Holdings, which climbed to a record closing high after posting solid third-quarter results.