Post Session: Quick Review

Indian equity markets traded in green for most part of the day and ended the session with gains of around two tenth of a percent. The benchmarks made a positive start and traded in fine fettle in early deals as sentiments remained upbeat on report that as many as 43.67 lakh businesses have filed the initial GSTR-3B returns for the month of October -- the highest monthly return filing within due date. As many as 39.33 lakh returns were filed within due date for September and 28.46 lakh for August and 33.98 lakh for July.  However, the markets slipped as global rating agency S&P doesn’t seem to be convinced with the macro indicators. In a report, S&P said that India’s activity indicator looks lackluster indicating they might not barge on the BBB- rating on India any time soon. Benchmarks rebounded in late morning session after a foreign brokerage report shared a positive outlook for Indian economy next year and said that it saw GDP growth accelerating to 8% in FY19 from a projected 6.4% in FY18. The global investment bank sees headline inflation around 5.3% in FY19 and said that the Reserve Bank of India (RBI) could hike policy rates by 75 bps by mid-2019. Beyond this, it believes that the central bank may not cut rates in a bid to support the economy. Going forward, it sees the negative impact from GST to gradually fade over the coming year.

Investors took note of ICRA’s report which highlighted that the economic expansion in terms of gross value added (GVA) is expected to improve to 6.3% in the three months to September from 5.6% in the previous quarter, on the back of a rise in industrial growth. Headline GVA growth, however, is likely to trail the 6.8% recorded in the second quarter of FY17. The agency added that the second quarter was a period of adjustment for the economy, following the goods and services tax (GST) rollout. Auto sector was buzzing in today’s trade as highlighting auto industry’s quick revival from the negative impact of note ban, global ratings agency, Fitch Ratings in its latest report said that Indian passenger vehicles (PV) and two-wheelers sales are likely to continue growing in high single digits in the near term, backed by sustained low cost of ownership and healthy rural spending due to good monsoons and higher public-sector wages.

Meanwhile, shares of public sector banks were buzzing in today’s trade as investors reacted to Cabinet’s actions. The Cabinet had cleared an ordinance for changes to Insolvency and Bankruptcy Code (IBC). The Ordinance will be presented during the Winter Session of the Parliament. Mixed reactions were displayed in leather stocks with most of them losing their early gains on report that the Cabinet Committee has deferred incentive package for the industry. The Union Cabinet was expected to soon take a decision on Rs 2,600 crore incentive package for the labour-intensive leather and footwear sector to boost exports and job creation.

On the global front, Asian markets closed in green, as globally investors await the minutes of recent Federal Reserve policy meeting due later today. The Bank of Japan is dropping subtle, yet intentional, hints that it could edge away from crisis-mode stimulus earlier than expected, through a future hike in its yield target. With inflation still way below its 2% target, the BOJ sees no immediate need to withdraw stimulus, and regards weak price growth as its most pressing policy challenge. The European markets were trading mostly in red, while the UK market was trading in green as investors waited for the chancellor’s Budget speech.

The BSE Sensex ended at 33569.74, up by 91.39 points or 0.27% after trading in a range of 33465.23 and 33654.53. There were 16 stocks advancing against 15 stocks declining on the index. (Provisional)

The broader indices ended mixed; the BSE Mid cap index was down by 0.04%, while Small cap index was up by 0.19%. (Provisional)

The top gaining sectoral indices on the BSE were Industrials up by 0.45%, Consumer Disc up by 0.37%, Auto up by 0.32%, PSU up by 0.28% and Basic Materials up by 0.20%, while Telecom down by 0.98%, Metal down by 0.61%, Healthcare down by 0.52%, Consumer Durables down by 0.38% and Energy down by 0.12% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Adani Ports & Special Economic Zone up by 3.38%, SBI up by 1.41%, HDFC up by 1.34%, Asian Paints up by 1.25% and Maruti Suzuki up by 1.09%. (Provisional)

On the flip side, Dr. Reddy’s Lab down by 1.33%, Lupin down by 1.22%, Axis Bank down by 1.09%, Bharti Airtel down by 0.77% and NTPC down by 0.76% were the top losers. (Provisional)

Meanwhile, highlighting auto industry’s quick revival from the negative impact of note ban, global ratings agency, Fitch Ratings in its latest report has said that Indian passenger vehicles (PV) and two-wheelers sales are likely to continue growing in high single digits in the near term, backed by sustained low cost of ownership and healthy rural spending due to good monsoons and higher public-sector wages.

As far as commercial vehicles (CV) were concerned, sales of medium and heavy commercial vehicles (MHCV) grew 20 per cent year-on-year in the quarter to September 2017 after declining in 2016. It further said that CV sales are expected to benefit from the government's infrastructure spending and more- efficient interstate movement of goods after the GST came into effect.

Fitch Ratings ‘2018 outlook of Asia Pacific automotive manufacturers and suppliers’ report, automobile manufacturers’ spending on research and development (R&D) is expected to remain high due to focus on new BS VI emission compliant models. Leading automakers intend to invest in electric vehicles (EVS) after the government took steps to promote the switch to EVs over the long term. Fitch Ratings further said that component suppliers will benefit from growth in India and key overseas markets, including the CV market in the US, which showed signs of recovery in 2017.

The CNX Nifty ended at 10343.25, up by 16.35 points or 0.16% after trading in a range of 10309.55 and 10368.70. There were 25 stocks advancing against 25 stocks declining on the index. (Provisional)

The top gainers on Nifty were Zee Entertainment up by 3.77%, Adani Ports & Special Economic Zone up by 3.39%, GAIL India up by 2.17%, Ambuja Cement up by 1.82% and Ultratech Cement up by 1.70%. (Provisional)

On the flip side, Tech Mahindra down by 2.09%, Bajaj Finance down by 1.97%, Hindalco down by 1.64%, Aurobindo Pharma down by 1.45% and Bharti Infratel down by 1.43% were the top losers. (Provisional)

The European markets were trading mostly in red; Germany’s DAX decreased 29.54 points or 0.22% to 13,138.00, France’s CAC decreased 1.72 points or 0.03% to 5,364.43, while UK’s FTSE 100 increased 19.62 points or 0.26% to 7,430.96.

Asian equity markets ended in green on Wednesday after the major US averages hit fresh record closing highs overnight, buoyed by upbeat corporate earnings results and higher commodity prices. Investors remained focused on the minutes from the latest Fed and ECB meeting due today and tomorrow, respectively. Japanese shares ended higher, buoyed by gains in large-cap stocks such as SoftBank and Fanuc, and financial companies as global growth hopes lifted the mood across world markets. Further, Chinese shares ended higher, underpinned by robust gains in banking and energy shares, while those in the defensive consumer and healthcare sectors paused for a breath after recent gains. Meanwhile Hong Kong's Hang Seng index ended above 30,000 points for the first time in 10 years, amid signs Chinese investors are stepping up buying of Hong Kong stocks.