Post Session: Quick Review

Indian equity benchmarks traded on a firm note throughout the day and ended with gain of around one percent snapping seven days losing streak. The market breadth was in favour of advances with five stocks advancing against each declining one. The equity benchmarks made an optimistic start in early deals as sentiments were upbeat after a sharp fall in oil prices eased investors’ concerns surrounding inflation and rising twin deficits. The EIA’s Short-Term Energy Outlook predicted that US oil production would top 11 million barrels per day this year. Traders also took some encouragement with ASSOCHAM chief’s statement that the RBI’s decision to keep the policy rate unchanged is on the expected lines, though the less than hawkish stance has come about as a relief for the industry which had even feared a possible hike in the lending rates, following inflationary concerns. Meanwhile, Moody’s said that the global green bond issuances are likely to surge by 60% to a record $250 billion this year, with India and China leading the emerging markets in this space.

Some support also came from a report that the CBDT has directed the taxman not to undertake ‘coercive’ steps in recovering pending taxes from startups under a specific provision of the Income Tax Act, a move aimed to help budding entrepreneurs in the country. Besides, sentiments also got boost by a report that India’s oil refining capacity is set to jump 80%, or by 194 MT, by 2030 as state refiners, Reliance Industries and Rosneft line up expansion plans, undeterred by the renewables explosion, hoping to meet future demand.

On the global front, Asian markets closed mostly in green. China reported trade balance data with a $20.34 billion surplus, compared to a $54.10 billion surplus seen for January. Exports rose 11.1%, compared to a 9.6% gain seen and up from 10.9% in December, while imports soared 36.9%, compared to a 9.8% rise expected, and a jump from 4.5% in December. The European markets were trading in red. Germany’s trade surplus last year fell for the first time since 2009, in a further sign that vibrant domestic demand is sucking in more imports and slowly re-balancing the country’s export-oriented economy.

Back home, stocks related to Public Sector Banks (PSBs) remained in focus after Economic Advisory Council to the Prime Minister (EAC-PM) chairman Bibek Debroy said that accretion of fresh non-performing assets (NPAs) of PSBs has virtually stopped.

The BSE Sensex ended at 34400.21, up by 317.50 points or 0.93% after trading in a range of 34108.76 and 34634.35. There were 24 stocks advancing against 7 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 1.85%, while Small cap index was up by 2.31%. (Provisional)

The top gaining sectoral indices on the BSE were Healthcare up by 2.94%, Basic Materials up by 2.56%, Realty up by 2.35%, Consumer Disc up by 1.66% and Telecom up by 1.51%, while Oil & Gas down by 0.28% was the sole losing index on BSE. (Provisional)

The top gainers on the Sensex were Sun Pharma up by 6.42%, Dr. Reddy’s Lab up by 3.00%, SBI up by 2.99%, Infosys up by 2.11% and Tata Steel up by 1.58%. (Provisional)

On the flip side, Power Grid down by 1.00%, ONGC down by 0.79%, Tata Motors down by 0.69%, ITC down by 0.67% and NTPC down by 0.64% were the top losers. (Provisional)

Meanwhile, highlighting issue of liquidity crisis among exporters due to delays in Goods and Services Tax (GST) refund, the Federation of Indian Export Organisations (FIEO) has said that the cash crunch is forcing exporters to turn down new orders and few of them have already refused new orders. The industry body noted that micro, small and medium enterprises (MSMEs) are also cutting their workforce due to liquidity crisis.

FIEO Director General Ajay Sahai pointed out that after the implementation of the new tax regime, many exporters have not received a single rupee. He also highlighted exporters’ feedback reports in which about 80 per cent of the refund is pending and the tax authorities are not accepting the application of input tax credit (ITC).

Sahai further expressed worries over the on-time implementation of e-wallet mechanism, as it is supposed to be introduced from April 01 this year, but still even broad contours of the scheme have not been notified. He also said that so far no consultation has happened with the trade and industry.

The CNX Nifty ended at 10579.30, up by 102.60 points or 0.98% after trading in a range of 10479.55 and 10637.80. There were 40 stocks advancing against 10 stocks declining on the index. (Provisional)

The top gainers on Nifty were Cipla up by 8.21%, Ambuja Cement up by 7.13%, Sun Pharma up by 6.32%, Bharti Infratel up by 3.81% and Dr. Reddy’s Lab up by 3.25%. (Provisional)

On the flip side, Indian Oil down by 4.78%, Aurobindo Pharma down by 2.36%, Power Grid down by 1.15%, NTPC down by 1.03% and ONGC down by 0.74% were the top losers. (Provisional)

The European markets were trading in red; UK’s FTSE 100 decreased 44.8 points or 0.62% to 7,234.62, Germany’s DAX decreased 120.32 points or 0.96% to 12,470.11 and France’s CAC decreased 28.69 points or 0.55% to 5,227.21.

Asian stocks ended mostly in green on Thursday following the week's sharp losses but traders are struggling to get a firm footing in a volatile February, spooked by heavy selling and warnings of more upheaval to come. Meanwhile, US bond yields crept up towards four-year highs and Brent crude prices hit a 2018 low on worries over surging US output, keeping underlying sentiments cautious. Japanese shares rose sharply on bargain hunting as the yen weakened against the dollar on the back of a return in investors’ risk appetite. Chinese shares ended lower even as a government report showed the country's exports grew at a faster-than-expected pace in January. In dollar terms, exports advanced 11.1 percent year-over-year in January, faster than the 10.7 percent rise economists had forecast. Imports jumped 36.9 percent from a year ago, well above the expected growth of 10.6 percent. Another report from the People's Bank of China revealed that China's foreign exchange reserves grew around $21.5 billion to $3.161 trillion in January, marking the 12th straight month of increase.