Post Session: Quick Review

Indian equity benchmarks traded in green territory for most part of the day and ended with gains of more than three fourth of a percent.  Last leg of trade pulled the benchmarks higher with Nifty and Sensex crossing 10,900 and 35,500 marks, respectively for first time ever. The market breadth was in favour of decline despite benchmarks closing at record highs. The equity benchmarks traded with a gain of around quarter a percent in early deals as sentiments remained up-beat after the India Ratings and Research (Ind-Ra), a subsidiary of Fitch Ratings, projected that the country’s economic growth will improve to 7.1 percent in the next fiscal year 2018-19 from 6.5 percent in the current year 2017-18. The agency termed the Goods and Services Tax (GST) and insolvency law major drivers for the growth of Indian economy. It expects greater allocation of funds to farm and rural sectors in 2018- 19 Budget, which is unlikely to be a populist one despite the impending 2019 general election. Separately, the GST Council has decided to slash rates on 29 items, mainly handicrafts, to 0% while the rates of 49 other items have also been rationalized. The decision was taken during the GST Council’s 25th meeting held yesterday.

Adding some optimism among the investors, Vice-President M Venkaiah Naidu said that various decisions of the central government, including demonetisation and GST, are likely to have a positive impact in the coming years. Some support also came with Union Minister Suresh Prabhu’s statement that the commerce ministry is working on a strategy to diversify India's export basket in a bid to boost shipments.

On the global front, Asian markets closed in green. China’s economy grew faster than expected in the fourth quarter of 2017, as an export recovery helped the country post its first annual acceleration in growth in seven years, defying concerns that intensifying curbs on industry and credit would hurt expansion. European markets were trading in green as investors watch out for developments in US politics, new earnings and fresh data. Retail sales in the UK declined much more than expected in December, dampening optimism over the British economy.

The BSE Sensex ended at 35533.40, up by 273.11 points or 0.77% after trading in a range of 35221.16 and 35535.89. There were 23 stocks advancing against 8 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.90%, while Small cap index was up by 0.93%. (Provisional)

The top gaining sectoral indices on the BSE were Bankex up by 1.51%, Realty up by 1.25%, PSU up by 1.18%, Industrials up by 1.14% and Metal up by 1.05%, while there were no losers on BSE. (Provisional)

The top gainers on the Sensex were Adani Ports & Special Economic Zone up by 4.53%, Yes Bank up by 2.51%, ICICI Bank up by 2.11%, SBI up by 1.98% and Kotak Mahindra Bank up by 1.52%. (Provisional)

On the flip side, Infosys down by 0.87%, Sun Pharma down by 0.62%, Power Grid down by 0.56%, ONGC down by 0.46% and Maruti Suzuki down by 0.44% were the top losers. (Provisional)

Meanwhile, a day after government decided to lower its additional borrowing from Rs 50,000 crore to Rs 20,000 crore, global credit rating agency, Moody's Investors Service’s Vice President Marie Diron has said that the move will not have impact on India's sovereign rating of Baa2 that they have upgraded recently with a stable outlook.

Further, noting that restructuring of the borrowing is a relatively small amount with respect to the size of India's economy, Diron said that a change in borrowing adjustments from one year to the other will also not have impact on its overall cost of debt in the long run, due to the country’s long maturity time debt frame.  Vice President is also not expecting any impact of the borrowing cut over the fiscal deficit target estimate.

Moody’s Vice President further listed benefits of the governments’ significant move of GST implementation in the country and described it as revenue neutral. She said simplified tax system will lead to greater compliance and greater productivity and this will result into revenue accretion, although the rating agency is not expecting an immediate impact of the GST move in the next fiscal year.

The CNX Nifty ended at 10900.45, up by 83.45 points or 0.77% after trading in a range of 10793.90 and 10906.85. There were 40 stocks advancing against 10 stocks declining on the index. (Provisional)

The top gainers on Nifty were Indiabulls Housing up by 4.79%, Adani Ports & Special Economic Zone up by 4.20%, Bajaj Finance up by 2.73%, ICICI Bank up by 2.31% and Yes Bank up by 2.21%. (Provisional)

On the flip side, Ambuja Cement down by 2.68%, Ultratech Cement down by 2.40%, Sun Pharma down by 0.77%, Infosys down by 0.72% and Power Grid down by 0.53% were the top losers. (Provisional)

The European markets were trading in green; UK’s FTSE 100 increased 5.45 points or 0.07% to 7,706.41, Germany’s DAX increased 104.14 points or 0.78% to 13,385.57 and France’s CAC increased 26.15 points or 0.48% to 5,520.98.

Asian equity markets ended in green on Friday as stronger-than-expected Chinese GDP data and expectations for strong corporate earnings helped investors shrug off concerns about a potential US government shutdown. The US House of Representatives passed a stop-gap funding measure late Thursday to avert a government shutdown. But prospects appear gloomy in the Senate, where Democrats say they have the vote to block the spending bill in a bid to negotiate on budget and immigration deals. Chinese stocks ended at fresh two-year highs on Friday, with the Shanghai index posting its fifth straight week of gains, as banks extended their rally and after the country posted its first acceleration in full-year growth in seven years. Growth for the 2017 full-year picked up to 6.9 percent, the first annual acceleration for the economy since 2010. The annual growth easily beat the government’s 2017 target of around 6.5 percent and quickened from 6.7 percent in 2016, the weakest pace in 26 years. Further, Japanese shares ended higher with financial stocks leading the gains after US yields rose, while GMO Internet soared after an activist fund called on the company to change its governance structure.