Post Session: Quick Review

Indian equity benchmarks traded on a jubilant note throughout the day and ended with gain of around two percent. The bulls took full control on Dalal Street with Nifty gaining around 200 points, while Sensex gaining more than 600 points. The market breadth was slightly in favour of advances with one stock advancing against each declining one. Indian equity benchmarks made a gap-up opening and traded jubilantly in early deals. The sentiments were upbeat as Union commerce and industry minister Suresh Prabhu exuded confidence that India will become a $5 trillion economy in the next seven years, adding that India will be a bigger economy than China at some point of time. He also said that manufacturing sector would contribute $1 trillion, services sector $3 trillion and the rest would come from agriculture for the country to become a $5 trillion economy in the next seven years. Some support also came with IMF stating that the Indian economy now seems to be on its way to recovering from disruptions caused by demonetization and roll-out of goods and services tax. At the same time, the IMF underscored the significance of reforms in other key sectors like education, health and improving the efficiency of the banking and financial systems. Investors also took some encouragement with FICCI enlightening that manufacturers in the country have a positive outlook for the sector in the January-March quarter on the back of higher production. The proportion of respondents reporting higher output growth during the Q4 2017-18 has increased significantly to 55% from 47% in Q3 while the percentage of respondents reporting low production has come down to 11% in the fourth quarter from 15% in the preceding quarter.

Meanwhile, on the sectoral front, real estate stocks were buzzing on report that housing sales exceeded new supply by 5% during the last two years in seven major cities. The private report advised end-users and investors to buy flats as prices are stable and interest rate low. It highlighted that housing sales stood at 2,44,830 units during 2016 and 2017 calendar years in seven major cities, while cumulative new launches of homes were 2,33,387 units. Besides, PSU banking stocks were under pressure on report that the gross non-performing assets (NPAs) of all the banks in the country amounted to Rs 8,40,958 crore in December, led by industry loans followed by services and agriculture sectors. The highest amount of gross NPAs was for country’s largest lender SBI at Rs 2,01,560 crore. Among others, Punjab National Bank was at Rs 55,200 crore; IDBI Bank - Rs 44,542 crore; Bank of India - Rs 43,474 crore; Bank of Baroda - Rs 41,649 crore; Union Bank of India - Rs 38,047 crore; Canara Bank - Rs 37,794 crore and ICICI Bank - Rs 33,849 crore. Indian Overseas Bank had gross NPAs of Rs 31,724 crore; Central Bank of India - Rs 32,491 crore; UCO Bank - Rs 24,308 crore; Allahabad Bank - Rs 23,120 crore; Andhra Bank - Rs 21,599 crore and Corporation Bank - Rs 21,818 crore.

On the global front, Asian markets closed in green as US job data revive risk appetite. Chinese Commerce Minister Zhong Shan said that any trade war with the United States will only bring disaster to the world economy, as Beijing stepped up its criticism on proposed metals tariffs by Washington amid fears it could shatter global growth. The European markets were trading in green following the jump in US markets. European Central Bank (ECB) board member Benoit Coeure said that short term interest rates are to remain at very low levels in the euro zone.

Back home, majority of oil and gas stocks closed in green after reports emerged that the government was mulling over the possibilities of creating integrated PSU oil majors. Auto stocks were buzzing after data released by the Society of Indian Automobile Manufacturers (SIAM) showed that domestic passenger vehicle sales rose 7.77 per cent to 2,75,329 units in February from 2,55,470 units in February 2017. Domestic car sales were up 3.7 per cent to 1,79,122 units as against 1,72,737 units in February 2017.

The BSE Sensex ended at 33933.65, up by 626.51 points or 1.88% after trading in a range of 33468.16 and 33962.48. There were 29 stocks advancing against 2 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.81%, while Small cap index was up by 0.66%.  (Provisional)

The top gaining sectoral indices on the BSE were Telecom up by 2.81%, Metal up by 2.37%, FMCG up by 2.25%, Oil & Gas up by 2.19% and Basic Materials up by 1.96%, while there were no losers on BSE. (Provisional)

The top gainers on the Sensex were Bharti Airtel up by 4.95%, ITC up by 4.24%, NTPC up by 4.12%, Yes Bank up by 3.61% and Hero MotoCorp up by 3.23%.  (Provisional)

On the flip side, Coal India down by 2.20% and SBI down by 0.10% were the only losers. (Provisional)

Meanwhile, the International Monetary Fund (IMF) has said that Indian economy is on its path to recovering from the negative impact of demonetisation and disruption caused by roll out of goods and services tax (GST). It further pointed out that in recent years, India’s economy has expanded strongly, due to macroeconomic policies that emphasise stability and efforts to tackle supply-side bottlenecks and structural reforms. It added that disruptions from note ban and the rollout of GST did slow growth.

As cash transactions dominated India’s economic activity, IMF stated that it was inevitable that demonetisation would temporarily affect economic activity. It also said that the rollout of the GST was a landmark accomplishment that can be expected to enhance efficiency of intra-Indian movement of goods and services, create a common national market, enhance tax buoyancy, and boost GDP growth and job creation.

However, IMF highlighted that with the economy growing by 7.2% in the October-December quarter of 2017-18, India has regained the status of the world's fastest-growing major economy. Calling this development a welcome change, it said that the growth prospects remain optimistic. Adding further, it said that the Indian economy would benefit from further reforms, such as enhancing health and education, encouraging private and public investment, and improving the efficiency of the banking and financial system. It noted that this would support durable and inclusive growth and enable India to move toward the income levels of wealthier countries.

The CNX Nifty ended at 10423.55, up by 196.70 points or 1.92% after trading in a range of 10295.45 and 10433.65. There were 48 stocks advancing against 2 stocks declining on the index. (Provisional)

The top gainers on Nifty were Bharti Airtel up by 5.21%, Indian Oil Corporation up by 4.31%, ITC up by 4.11%, Vedanta up by 4.08% and NTPC up by 3.86%.  (Provisional)

On the flip side, Coal India down by 2.15% and Aurobindo Pharma down by 1.74% were the only losers. (Provisional)

The European markets were trading in green; UK’s FTSE 100 increased 0.9 points or 0.01% to 7,225.41, Germany’s DAX increased 89.46 points or 0.72% to 12,436.14 and France’s CAC increased 14.86 points or 0.28% to 5,289.26.

Asian markets closed in green on Monday as geopolitical tensions eased, commodity prices advanced and the latest jobs report showed the US economy added the biggest number of jobs in over 1-1/2 years in February. Wages have lagged behind the growth in employment, helping ease investor fears over a faster pace of rate hikes by the Federal Reserve. Japanese shares hit a 1-1/2-week high, helped by tech shares, but early gains were trimmed as a suspected cronyism scandal involving the sale of state-owned land could hit Prime Minister Shinzo Abe's popularity. Also, Japan's business survey index of large manufacturers weakened notably in the three months ended March, the quarterly survey by the Ministry of Finance and the Cabinet Office showed, triggering some profit taking at higher levels. Further, Chinese stocks rose for a third day as easing trade-war fears helped lift material companies.