Post Session: Quick Review

Indian equity markets ended the Friday’s trade in green terrain and went home with a gain of around a percent. Markets started the session on an optimistic note with Niti Aayog Vice Chairman Rajiv Kumar’s statement that India will emerge as a model for the rest of the world once it completes economic, political and social transitions. He highlighted India’s development process, outlined country’s experiences since Independence and laid out a future vision for achieving a New India by 2022. Traders also took some encouragement with CRISIL’s report stating that asset quality of microfinance institutions (MFI), including small finance banks, has come out of the impact of demonetisation and stabilised since June 2017. The report added that asset quality has improved, as evidenced by reducing portfolio delinquencies and cumulative collection efficiencies have risen to over 99 percent for disbursements since April 2017.

Some support also came with private report stating that exports of India-made retail and lifestyle products clocked a 16% growth in 2017, over the same period last year. It further noted that in terms of growth, India has surpassed China which traditionally led from the region, and now stands at number 3. Traders shrugged off private report that America’s bilateral trade deficit with four major countries, including India, narrowed in the first three quarters of 2017 as compared to the previous year, the US administration today said in a report according to which India’s growth has slowed due to the effects of its structural economic reforms.

Banking stocks remained on buyers’ radar with Fitch rating stating that the RBI’s new norms for overhauling the mechanism to deal with bad loans is aimed at speeding up the NPA resolution, but would undermine the banking sector earnings in the near-term. Metal counters gained shine after India Ratings and Research (Ind-Ra) revised the outlook on the steel sector to stable for FY19 from negative in FY18, led by demand growth in domestic and global markets. While it expects stressed steel assets to meet incremental demand over next 18-24 months, the ratings firm felt steel players would gain from improved sales realizations driven by improvement in operational and financial performance in FY19.

On the global front, Asian markets ended mostly in green after U.S. government debt yields fell from multiyear highs reached on Wednesday, helping ease worries over inflation and higher interest rates. Japanese shares eked out modest gains as bond markets regained stability. European markets were trading mostly in green in early deals as multiple speeches from Fed officials due later today for further insight on inflation and interest rates. Germany's economy expanded as initially estimated in the fourth quarter largely on foreign demand.

The BSE Sensex is currently trading at 34142.15, up by 322.65 points or 0.95% after trading in a range of 33832.00 and 34167.60. There were 26 stocks advancing against 5 stocks declining on the index. (Provisional)

The broader indices were trading in green; the BSE Mid cap index surged 1.47%, while Small cap index was up by 1.54%. (Provisional)

The top gaining sectoral indices on the BSE were Metal up by 3.16%, Basic Materials up by 2.43%, Healthcare up by 1.91%, Telecom up by 1.90% and Power was up by 1.44%, while there were no losers on the BSE sectoral front. (Provisional)

The top gainers on the Sensex were Sun Pharma up by 6.02%, Tata Steel up by 5.97%, Yes Bank up by 2.21%, ONGC up by 1.99% and Bharti Airtel up by 1.98%. (Provisional)

On the flip side, Asian Paints down by 1.38%, Infosys down by 0.56%, Coal India down by 0.51%, Hindustan Unilever down by 0.17% and Mahindra & Mahindra down by 0.12% were the top losers. (Provisional)

Meanwhile, amid healthy global and domestic demand growth along with ongoing capacity rationalisations in China, the credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has revised the steel sector outlook to stable for the next financial year (FY19) from negative in the current fiscal year (FY18). It added that improvement in demand-Supply balance is expected to enhance operational and financial performance of steel industry.

The rating agency also revised outlook on rated steel entities to stable for FY19 from negative in FY18, on the back of higher cash flow generation and balance sheet deleveraging. Besides, it is expecting consolidation in the steel sector during FY19, but some of the stressed assets may take 12-18 months to ramp-up utilisation to optimum levels.

Ind-Ra is also expecting steadiness in import-export levels and added that a turnaround in stressed assets along with capacity addition could meet the incremental demand. However, the report expressed worries over the increasing global trade protectionism, as it is risk factor for export and may also put some pressure on the domestic capacity utilization.

The CNX Nifty is currently trading at 10491.05, up by 108.35 points or 1.04% after trading in a range of 10396.65 and 10499.10. There were 43 stocks advancing against 7 stocks declining on the index. (Provisional)

The top gainers on Nifty were Tata Steel up by 6.31%, Sun Pharma up by 5.21%, UPL up by 3.72%, Tech Mahindra up by 3.13% and Vedanta up by 2.81%. (Provisional)

On the flip side, GAIL India down by 1.66%, Asian Paints down by 1.46%, Eicher Motors down by 0.54%, Mahindra & Mahindra down by 0.46% and Infosys down by 0.44% were the top losers. (Provisional)

European markets were trading mostly in green France’s CAC rose 5.03 points or 0.09% to 5,314.26 and Germany’s DAX was up by 25.54 points or 0.2% to 12,487.45, while UK’s FTSE 100 was down by 11.04 points or 0.15% to 7,241.35.

The Asian markets closed in green on Friday following the lead from Wall Street, with energy firms lifted by a rally in oil prices. The market sentiments improved further after US government debt yields fell from multiyear highs reached on Wednesday, helping ease worries over inflation and higher interest rates. Japanese shares eked out modest gains as bond markets regained stability. Further, Chinese shares extended their rebound, struggling off Beijing’s seizure of high-flying conglomerate Anbang Insurance Group amid signs the government is once again supporting the country’s stock markets after their recent rout.