Bulls take control on Dalal Street as BJP leads in Gujarat, Himachal

Extending gaining streak for third straight day, Indian equity benchmarks ended the Monday’s trade with a gain of around half a percent, as Prime Minister Narendra Modi-led BJP looked set to win key polls in Himachal Pradesh and Gujarat. Markets made dismal start with Sensex and Nifty tumbling below their crucial 32,600 and 10,100 levels in early deals, as early trends had suggested that the BJP and the Congress are locked in a tight race to win Gujarat. However, domestic markets staged splendid recovery and entered into green terrain after the ruling party -- BJP -- made a comeback against Congress in Himachal Pradesh and Gujarat election results. Sentiments also remained up-beat with data from the commerce department, which showed that India’s exports rose at a faster clip in November, reversing the contraction in the previous month. Exports grew 30.6% in November from a year ago, while imports rose 19.6%. Traders also took some encouragement with statement of an UN expert that India can achieve an 8% growth rate for the next two decades by promoting investment and improving the living conditions of its people.

Sentiments also remained optimistic with Reserve Bank of India (RBI) Governor Urjit Patel’s statement that with growth picking up in the second quarter of the current financial year, the economic slowdown may have bottomed out. He said “our recent growth numbers may have disappointed some in the first quarter of this fiscal year, but the second quarter has recorded an uptick and the slowdown may well be bottoming out”. Traders also took some support with report that foreign investors are flocking to the Indian capital markets in a big way with a net inflow of over $30 billion (more than Rs 2 lakh crore) of so-called hot money in 2017, with equities alone getting over $8 billion -- an amount bigger than the cumulative investment of the previous two years.

Positive opening in European counters too aided sentiments on hopes a major US tax reform bill will be passed before the end of the year. Asian markets ended mostly in green led by over one and a half a percent jump in Japanese markets, as the country’s exports accelerated sharply in November, yet again pointing to growing momentum in the world’s third-biggest economy.

Back home, stocks of public sector banks (PSBs) remained in focus on report that the first round of capital infusion for state-run banks that was announced recently is likely to take place soon. The government is likely to raise around Rs 70,000 crore by February 2018 as part of the total Rs 1.35 lakh crore to be met through recapitalization bonds. Finance Minister Arun Jaitley said the government has decided to recapitalize PSBs to enhance credit growth and job creation. Select stocks from fertiliser space remained n buyers’ radar after the Finance Ministry sought Parliament’s approval for the net additional spending of Rs 33,380 crore ($5.21 billion) for 2017-18. This includes Rs 20,532 crore for the fertiliser sector. Stocks from footwear industry exhibited mixed trend after the Union Cabinet chaired by Prime Minister Narendra Modi on Friday approved special package for employment generation in leather and footwear sector. The package involves implementation of central scheme ‘Indian Footwear, Leather & Accessories Development Programme’ with an approved expenditure of Rs 2,600 crore over the three financial years from 2017-18 to 2019-20.

Finally, the BSE Sensex surged 138.71 points or 0.41% to 33,601.68, while the CNX Nifty was up by 55.50 points or 0.54% to 10,388.75.

The BSE Sensex touched a high and a low of 33,801.90 and 32,595.63, respectively and there were 20 stocks on gaining side as against 11 stocks on losing side on the index.

The broader indices ended in green; the BSE Mid cap index gained 0.76%, while Small cap index was up by 0.45%.

The top gaining sectoral indices on the BSE were Metal up by 1.83%, Auto up by 1.21%, Consumer Discretionary Goods & Services up by 1.17%, Consumer Durables up by 0.94% and Telecom up by 0.91%, while Realty down by 0.29% and Energy was down by 0.11% were the only losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 2.71%, Sun Pharma up by 2.06%, SBI up by 1.97%, Wipro up by 1.90% and ICICI Bank up by 1.78%. On the flip side, Yes Bank down by 1.23%, Coal India down by 1.11%, Infosys down by 0.79%, ITC down by 0.62% and Kotak Mahindra Bank down by 0.53% were the top losers.

Meanwhile, reversing the fall witnessed in October, India’s merchandise exports jumped 30.55% to $26195.76 million in November 2017, on the back of robust growth in shipments of gems and jewellery and engineering goods. However, the overall trade deficit widened to $13829.20 million in November 2017 as against $13395.61 million in the year-ago period. The trade deficit during April-November 2017-18, was $99976.86 million as against $67886.19 million in the same period last year. 

As per the data released by the Commerce Ministry, exports grew by 30.55% to $26195.76 million in November 2017, as compared to $20066.26 million in the same month a year ago. In Rupee terms exports was higher by 25.21% to Rs 169912.50 crore in November 2017, as compared to Rs 135699.47 crore in November 2016. Cumulative value of exports for the period April-November 2017-18 was $196482.31 million as against $175410.66 million, registering a positive growth of 12.01% over the same period last year. In Rupee terms it was up by 7.90% to Rs 1267771.18 crore from Rs 1174997.07 crore.

Non-petroleum and Non Gems & Jewellery exports in November 2017 were valued at $19247.56 million against $15104.42 million in November 2016, an increase of 27.43%. Non-petroleum and Non Gems and Jewellery exports during April-November 2017-18 were valued at $143528.58 million as compared to $126660.74 million for the corresponding period in 2016-17, an increase of 13.32%.

Imports during November 2017, increased by 19.61% to $40024.96 million as compared to  $33461.87 million in November 2016 and in rupee terms it was up by 14.73% to Rs 259612.29 crore from Rs 226288.21 crore in November 2016. Cumulative value of imports for the period April- November 2017-18 was $296459.17 million as against $243296.85 million, registering a positive growth of 21.85% over the same period last year. In rupee terms the cumulative value of imports was Rs 1913047.30 crore, up by 17.35% as against Rs 1630199.71 crore in the same period last year.

Oil imports during November, 2017 were valued at $9550.97 million which was 39.14% higher than oil imports valued at $6864.25 million in November 2016. Oil imports during April- November, 2017-18 were valued at $65802.97 million which was 22.65% higher than the oil imports of $53652.71 million in the corresponding period last year. Non-oil imports during November, 2017 were estimated at $30473.99 million which was 14.57% higher than non-oil imports of $26597.62 million in November, 2016. Non-oil imports during April- November 2017-18 were valued at $230656.20 million which was 21.63% higher than the level of such imports valued at $189644.14 in April- November, 2016-17.

The CNX Nifty traded in a range of 10,443.55 and 10,074.80. There were 35 stocks in green as against 14 stocks in red, while one stock remained unchanged on the index.

The top gainers on Nifty were Vedanta up by 3.84%, Hindalco up by 3.23%, Mahindra & Mahindra up by 2.59%, Cipla up by 2.58% and Sun Pharma up by 2.11%. On the flip side, Tech Mahindra down by 1.36%, Yes Bank down by 1.30%, HCL Tech down by 1.25%, UPL down by 1.14% and Coal India down by 1.13% were the top losers.

The European markets were trading in green; UK’s FTSE 100 increased 28.48 points or 0.38% to 7,519.05, France’s CAC surged 64.66 points or 1.21% to 5,413.96 and Germany’s DAX was up by 177.13 points or 1.35% to 13,280.69.

Asian equity markets ended mostly in green on Monday after data showed Japan's export growth accelerated in November. Japanese shares ended higher as the yen weakened on optimism about Republican lawmakers passing tax reform legislation in the US and the legislation will reduce corporate as well as individual tax rates and is intended to boost growth in the world's largest economy. Further, Chinese shares finished marginally higher. House prices in majority of the Chinese cities increased in November, figures from the National Bureau of Statistics showed today. On a monthly basis, house prices climbed in 50 cities out of 70 surveyed by the government.