Post Session: Quick Review

Indian equity markets traded on a firm note for most part of the day and ended with modest gains. The market breadth was in favour of declines with two stocks advancing against three declining ones. The equity benchmarks made a positive start and traded slightly in green in early deals. Traders took some support with report that the Commerce and Industry Ministry is mulling incentives for states that play a proactive role in promoting exports as it will help boost economic growth. However, selling in noon session dragged markets lower as investors were cautious with the rating agency CRISIL attributing the continuing slowdown to the impacts of the demonetisation, GST implementation and weakness in agriculture, though it has maintained its FY19 growth estimate at 7.6% on the low base.

But markets gained strength soon with CARE Ratings’ latest report which said that growth in bank credit is a positive sign which if sustained could point towards a recovery in terms of demand for funds for investment purposes. Investors also took some support from a report which said that direct tax collections in the first nine months of the current fiscal grew 18.2 percent to Rs 6.56 lakh crore, mainly on account of income tax mop-up from individuals.

Meanwhile, investors took note of SBI report that India needs to urgently raise its tax base to meet the fiscal deficit target without curbing essential expenditure. The report - ‘India's Public Finance Trends’ said that the country’s gross fiscal deficit as percentage of GDP, started shooting up after the 2008 financial crisis. However, with economic recovery gaining pace, the government embarked on the path of fiscal consolidation and has brought down its fiscal deficit to 3.5% of GDP in 2016-17. Select stocks in fast-moving consumer goods (FMCG) were buzzing in today’s trade on private report that in the next 12 months, consumer goods companies would see a revival, both in volume and margin terms, with an anticipated revival in the rural sector. With a few state elections and expected populist budget, the rural sector is anticipated to be a prime beneficiary. However, select stocks in housing loans and banking space were under pressure after a report flagged concerns about the growing delinquencies in affordable housing segment. A joint report by Moody’s and its domestic affiliate ICRA enlightened that competitive pressures and larger exposure to the self-employed are the prime reasons for the build-up of stress in the segment.

On the global front, Asian markets closed mixed, while the yen stole the currency spotlight and jumped after the Bank of Japan’s slight reduction to its bond purchases reminded investors that it will eventually normalize policy. The European markets were trading in green amid investors eyeing the release of a number of economic reports out of the euro zone. The unemployment rate in the euro zone fell as expected in November. In a report, Eurostat said that the rate of unemployment fell to a seasonally adjusted 8.7%, from 8.8% in the preceding month. European equities were already boosted after German Chancellor Angela Merkel on Monday entered talks with a rival party in a last-ditch effort to form a coalition government after months of political uncertainty in the euro zone’s largest economy.

Back home, select cement stocks were buzzing on report that some companies have raised cement prices in Mumbai by 9-20 percent in January.

The BSE Sensex ended at 34431.40, up by 78.61 points or 0.23% after trading in a range of 34343.41 and 34488.03. 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 0.42%, while Small cap index was up by 0.01%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 3.13%, Energy up by 1.06%, Consumer Durables up by 0.84%, FMCG up by 0.42% and Oil & Gas up by 0.25%, while Telecom down by 1.37%, Healthcare down by 0.67%, Power down by 0.62%, Utilities down by 0.59% and Auto down by 0.45% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Coal India up by 5.65%, Yes Bank up by 2.58%, Wipro up by 1.96%, ITC up by 1.83% and Reliance Industries up by 1.25%. (Provisional)

On the flip side, Bharti Airtel down by 1.25%, Bajaj Auto down by 1.16%, Hero MotoCorp down by 1.09%, Adani Ports & Special Economic Zone down by 1.07% and Sun Pharma down by 1.01% were the top losers. (Provisional)

Meanwhile, registering a growth of 18.2% in the first nine months of the current fiscal, the government’s revenue collection continued its rising trend, mainly on account of income tax mop-up from individuals. According to the Ministry of Finance, India’s net direct tax collections, which are made up of personal and corporate taxes, rose to Rs 6.56 lakh crore during the April-December period of the financial year 2018. The collection indicates that 67% of the annual budget target of direct taxes (Rs 9.8 lakh crore) has been achieved.

Before adjusting for refunds, gross collections surged by 12.6% to Rs 7.68 lakh crore up to December, 2017. Further, refunds amounting to Rs 1.12 lakh crore have been issued during April to December, 2017.

In terms of advance tax, Rs 3.18 lakh crore have been received up to December, 2017, a growth of 12.7% over the corresponding period of last year, while Corporate Income Tax (CIT) Advance Tax grew 10.9% and Personal Income Tax (PIT) Advance Tax surged 21.6%.

The CNX Nifty ended at 10627.40, up by 3.80 points or 0.04% after trading in a range of 10603.60 and 10659.15. There were 19 stocks advancing against 31 stocks declining on the index. (Provisional)

The top gainers on Nifty were Coal India up by 5.76%, Yes Bank up by 2.37%, ITC up by 1.73%, Wipro up by 1.48% and Reliance Industries up by 1.23%. (Provisional)

On the flip side, Zee Entertainment down by 2.22%, Eicher Motors down by 2.05%, Bharti Infratel down by 1.59%, Hindalco down by 1.47% and Bajaj Finance down by 1.46% were the top losers. (Provisional)

The European markets were trading in green; UK’s FTSE 100 increased 23.12 points or 0.3% to 7,719.63, Germany’s DAX increased 20.2 points or 0.15% to 13,387.98 and France’s CAC increased 24.24 points or 0.44% to 5,511.66.

Asian equity markets ended mixed on Tuesday as investors digested earnings guidance from tech heavyweight Samsung Electronics and kept an eye on ongoing talks between South Korea and North Korea, the first formal talk between the two Koreas in more than two years. Chinese shares extended gains after central bank data showed China's foreign exchange reserves increased for the eleventh straight month in December. Further, Japanese shares ended higher, with sentiments lifted by record highs on Wall Street overnight and strong December sales reported by clothing company Fast Retailing at its Uniqlo clothing outlets in Japan. Investors shrugged off the yen's strength against the dollar after the Bank of Japan trimmed the size of its bond-repurchase offer in its latest market operation.