Benchmarks snap 9-day gaining streak

Snapping nine day winning streak, Indian equity benchmarks ended the Wednesday’s trade slightly in red, as traders opted to book some of their profit after nine sessions of continuous rally amid lack of any major domestic cues. Also, investors eyeing for corporate earnings to get further market direction. Markets started the session on an optimistic note and traded in fine fettle for most part of the day, as traders took some encouragement with International Monetary Fund’s (IMF) statement that India’s GDP growth will accelerate in the current and next fiscal years as structural reforms raise potential output. GDP is forecast to grow 7.4% in the current fiscal from 6.7% in FY18 and accelerate further in FY20 to 7.8%. Market participants also got some support with Union Minister Suresh Prabhu’s statement that the government is working with the US to resolve all trade issues even as America has decided to review India’s eligibility to enjoy duty-free access for certain products under a tax benefit scheme. Meanwhile, the group of ministers (GoM) on Tuesday worked out a revamped return for goods and services tax (GST) to help ease the burden on businesses. Domestic sentiments were upbeat with a report stating that India recorded the biggest rise of 73% in investment proposals into France among emerging economies in 2017, as there were 19 Indian foreign investment projects in France.

However, profit booking in last leg of trade played spoil sports for the domestic markets which dragged the key indices slightly in red. Anxiety spread among the investors with a private report that India’s economy will be hit hard by a combination of a global tariff war and the US Federal Reserve’s monetary tightening cycle. The report noted that a tariff war will reduce exports and lead to imported inflation, which will hurt Indian purchasing power and investments. Some concerns also came with a report highlighting that though the GST implemented by the government in July last year has simplified the tax regime and resolved some long-standing issues such as valuation and tax type for the real estate sector, the consumers might not see a significant reduction in property prices just yet.

On the global front, European markets were trading mostly in green as investors monitored a fresh batch of corporate earnings and economic data. Asian markets ended mostly in green on an upbeat note as American firms posted strong quarterly earnings and tensions eased on the Korean Peninsula.

Back home, oil marketing companies (OMCs) like Indian Oil Corporation (IOC), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) remained under pressure as oil prices edged up. Majority of sugar stocks ended in red after Indian Sugar Mills Association (ISMA) said that sugar production in the current season up to April 15, has crossed the expected levels and the Indian sugar industry has already produced 299.80 lakh tonne. It added that the actual sugar production up to April 15 is already 50 lakh tonne more than the estimated sugar consumption for the whole season up to September 30. Some shares of hotel companies ended in green amid expectations of the holiday season bringing in robust demand, which will result in higher room rates and increased occupancy.

Finally, the BSE Sensex shed 63.38 points or 0.18% to 34,331.68, while the CNX Nifty was up by 22.50 points or 0.21% to 10,526.20.

The BSE Sensex touched a high and a low of 34,591.81 and 34,270.04, respectively and there were 11 stocks on gaining side as against 20 stocks on losing side on the index.

The broader indices ended in red; the BSE Mid cap index slipped 0.07%, while Small cap index was down by 0.37%.

The top gaining sectoral indices on the BSE were FMCG up by 1.57%, Telecom up by 0.50%, Realty up by 0.49%, Metal up by 0.46% and Basic Materials was up by 0.37%, while Consumer Durables down by 1.18%, Bankex down by 0.85%, Energy down by 0.81%, Oil & Gas down by 0.65% and PSU was down by 0.57% were the top losing indices on BSE.

The top gainers on the Sensex were ITC up by 2.82%, Wipro up by 2.40%, Bharti Airtel up by 1.29%, Tata Steel up by 0.95% and Adani Ports & SEZ up by 0.81%. On the flip side, Axis Bank down by 2.60%, Mahindra & Mahindra down by 1.55%, Indusind Bank down by 1.23%, Hero MotoCorp down by 0.97% and Coal India down by 0.89% were the top losers.

Meanwhile, the Road Transport and Highways Minister Nitin Gadkari has said that his ministry fixed the national highways project award target of 20,000 kilometres (km) for the financial year 2018-19. He noted that this is about 25 percent more than the 17,055 km awarded in the preceding year, of which, 8,652 km was awarded by the ministry, 7,397 by the National Highways Authority of India (NHAI) and 1,006 km by the National Highways and Infrastructure Development Corporation (NHIDCL).

The Minister has stated that the construction targets for the ongoing financial year have been set at 16,420 km, as compared to 9,829 km length of national highways were constructed during 2017-18. Of total construction target, 9700 km will be constructed by MoRTH, 6000 km by NHAI and 720 km by NHIDCL. He noted that in comparison. Besides, he mentioned that per day construction target has been set at 45 km for the current year, as against the achieved target of 27 km per day during 2017-18.

Gadkari further said that his ministry is making all-out efforts for improving and strengthening the highways network in the country. He also said that this year, the focus would be more on construction, but the award would be more than last year. In addition, he said that there will also be focus on completing the detailed project reports (DPRs) of all the ‘in-principle’ declared NHs. He added that yearly targets will be divided into quarterly targets so that there is no pressure at the end of the year.

The CNX Nifty traded in a range of 10,594.20 and 10,509.70. There were 22 stocks in green as against 28 stocks in red on the index.

The top gainers on Nifty were ITC up by 3.33%, Wipro up by 2.90%, Ultratech Cement up by 2.29%, Zee Entertainment up by 2.22% and GAIL India up by 2.01%. On the flip side, HPCL down by 3.03%, Axis Bank down by 2.76%, Titan Company down by 1.98%, Lupin down by 1.75% and Tech Mahindra down by 1.54% were the top losers.

The European markets were trading mostly in green; France’s CAC increased 13.58 points or 0.25% to 5,367.12 and UK’s FTSE 100 gained 51.69 points or 0.72% to 7,277.74, while Germany’s DAX was down by 4 points or 0.03% to 12,581.57.

Asian equity markets ended mostly in green on Wednesday on an upbeat note as American firms posted strong quarterly earnings and tensions eased on the Korean Peninsula. US President Donald Trump said the United States is engaged in direct talks at ‘extremely high levels’ with North Korea to try to set up a summit in the next two months. Chinese shares ended higher after the People's Bank of China lowered the reserve requirement ratio for most commercial banks in a bid to free up funds for lending and improve liquidity. In another development, China said it would allow full foreign ownership of automakers in five years, ending restrictions that helped to fuel its dispute with Washington. Japanese shares rallied as the yen weakened on hopes for improved relations between the US and North Korea. Investors also digested trade data and kept an eye on the US-Japan summit talks. Japan posted a merchandise trade surplus of 797.3 billion yen in March up 32.1 percent on year. That exceeded expectations for 499.2 billion yen and was up sharply from 3.4 billion yen in February.