Benchmarks end flat; Nifty holds 10,550 mark

Indian equity benchmarks ended the choppy day of trade flat with negative bias as minutes of the central bank’s policy panel meeting stoked expectations of an interest rate hike. After making a cautious start, markets traded in red terrain for most part of the day as sentiments remained dampened with IMF chief Christine Lagarde’s statement that she does not expect the pace of economic reforms in India to continue in an election year. Sentiments also remained dampened after RBI’s MPC members flagged several concerns, including an increase in minimum support prices for farmers and high and volatile crude oil prices. Market participants also remained concerned with former finance minister Yashwant Sinha’s statement that the cash crunch at ATMs in some parts of the country is a case of complete mismanagement on the part of both the RBI and the government. He said the magnitude of the crisis is huge and the Reserve Bank did not have a backup plan to deal with such a situation. Investors took note of report that, All India Bank Employees Association (AIBEA), representing the banking industry said that concrete action is required by the Reserve Bank to address the cash crunch and warned of a protest on the issue.

However, markets pared almost all of their early losses in last leg of trade with traders getting some solace with the private report that PE investments witnessed a robust 46 per cent jump in deal values at $1.3 billion in March, taking the total tally for the first quarter of 2018 to $4 billion, up 76 per cent over the same period a year ago. The report added that there were 59 PE transactions worth $1.3 billion in March this year, while in the corresponding period last year it stood at $888 million by way of 70 deals. Investors also got some comfort with private report showing that India has been recording the highest growth rate amongst the Brazil, Russia, India, China and South Africa (BRICS) economies. The report highlighted that in spite of some reformative steps that slowed the growth momentum in the first quarter of FY18, the economy is likely to grow at 7.4 per cent in 2018 -- higher than the advanced economies and the world -- which are at 2 per cent and 3 per cent respectively.

Firm opening in European counters too aided sentiments as investors monitored a fresh batch of corporate earnings and economic data. Asian markets ended in red as confidence among Japanese manufacturers worsened for a third straight month in April to a level unseen since early last year, the poll showed, as rises in the yen and crude oil prices threaten to undermine corporate profits.

Back home, software stocks edged higher led by surge in TCS which remained the biggest gainer after reporting healthy growth in quarterly earnings. The Tata Group firm has reported consolidated profit at Rs 6,904 crore for the quarter ended March 2018, registering a 5.7 percent growth compared to Rs 6,531 crore in previous quarter and 4.5 percent growth over year-ago period. However, banking stocks remained under pressure after S&P Global Ratings said that Indian banks’ results for the fiscal year ended March 2018 are likely to be weak. Realty sector closed in red on a private report that housing prices fell by an average of 7 percent in the first quarter of 2018 as realtors cut property rates to rope in fence sitters even as the number of new project launches jumped by 48 percent across top nine cities with real estate developers aligning themselves to RERA regulations and migrating to GST compliances.

Finally, the BSE Sensex shed 11.71 points or 0.03% to 34,415.58, while the CNX Nifty was up by 1.25 points or 0.01% to 10564.05.

The BSE Sensex touched a high and a low of 34,487.33 and 34,311.29, respectively and there were 10 stocks on gaining side as against 21 stocks on losing side on the index.

The broader indices ended mixed; the BSE Mid cap index declined 0.44%, while Small cap index was up by 0.02%.

The top gaining sectoral indices on the BSE were IT up by 4.80%, TECK up by 3.89%, Telecom up by 0.54% and Auto up by 0.17%, while Utilities down by 1.22%, Realty down by 1.07%, Bankex down by 1.04%, Power down by 0.98% and PSU was down by 0.88% were the top losing indices on BSE.

The top gainers on the Sensex were TCS up by 6.76%, Infosys up by 4.02%, Coal India up by 3.25%, Wipro up by 2.31% and Bharti Airtel up by 1.47%. On the flip side, Yes Bank down by 3.00%, ICICI Bank down by 2.49%, Tata Steel down by 2.29%, SBI down by 1.97% and HDFC down by 1.76% were the top losers.

Meanwhile, domestic credit rating agency, ICRA in its latest report has said that the Ministry of Road Transportation and Highways’ lower target of awarding works for around 20,000 kilometres (km) length of National Highways during 2018-19, would make achievement of the Bharatmala programme’s goals more challenging.

According to the report, in order to achieve the ambitious target for new highway development programme, which is 83,677 km by FY22, the award rate has to be more than double from what it was in FY18. It also pointed out that the target for FY19 has instead been lowered to 20,000 km from 25,000 km last year, which makes the achievement of Bharatmala targets even more challenging.

The rating agency has stated that this lower target is, however, about 17 percent more than the 17,055 km awarded during FY18, which by far has been the best year for the ministry, both in terms of execution and projects awarded. It also said that the government has decided to focus more execution in the current year. It added that given the ambitious target in Bharatmala the award rate should be upwards of 40,000 km for the next two years - FY19 and FY20.

The CNX Nifty traded in a range of 10,582.35 and 10,527.45. There were 17 stocks in green as against 33 stocks in red on the index.

The top gainers on Nifty were TCS up by 6.98%, Tech Mahindra up by 4.65%, Infosys up by 4.13%, HCL Tech up by 3.77% and Coal India up by 2.88%. On the flip side, Yes Bank down by 2.98%, ICICI Bank down by 2.45%, Tata Steel down by 2.40%, SBI down by 1.75% and Bajaj Finserv down by 1.69% were the top losers.

The European markets were trading in green; Germany’s DAX rose 9.6 points or 0.08% to 12,577.02, France’s CAC increased 27 points or 0.5% to 5,418.64 and UK’s FTSE 100 was up by 34.1 points or 0.47% to 7,363.02.

Asian equity markets ended in red on Friday, led by losses in technology stocks amid falling demand for smartphones and a downward revision in revenue target by the world's largest contract chipmaker Taiwan Semiconductor Manufacturing Company. Japanese shares ended lower as worries about slower smartphone demand hit technology shares, while financial stocks rallied thanks to higher US yields. Further, Chinese shares ended down, due largely to heavy selling in telecom and software stocks.