Post Session: Quick Review

Indian equity benchmarks with volatility and garnered gains of around four tenth of a percent. The firm trade prevailed during early deals but selling crept in middle and benchmarks erased off their gains after oil rose above $75 a barrel to its highest since November 2014, supported by OPEC-led production cuts, strong demand and the prospect of renewed US sanctions on Iran. The market breath was in favour of declines with three stocks advancing against four declining ones. The sentiments were upbeat on report that the Goods and Services Tax (GST) collections for March exceeded Rs 96,000 crore by April 23, the largest mop-up for any month since the comprehensive indirect tax’s launch in July last year. The report added that March collections could cross the coveted Rs 1 lakh crore mark by April-end, as payments are still being made by a section of taxpayers with late penalties. Separately, the Export Promotion Council for EOUs and SEZs (EPCES) said that exports from special economic zones (SEZs) jumped by 15% to Rs 5.52 lakh crore during the financial year 2018. It also said that in 2017-18, goods export from these zones stood at Rs 2.74 lakh crore, while shipments of services aggregated to Rs 2.78 lakh crore.

Meanwhile, the street took note that the World Bank in its latest Migration and Development Brief has stated that India retained the top position as the largest recipient of remittances, with remittances from overseas Indians increasing nearly 10% in 2017. As per the report, remittances to India jumped 9.9% to about $69 billion in 2017, reversing the previous year’s dip of $62.7 billion in 2016, but were still short of $70.4 billion received in 2014. However, investors took note of the Petroleum and Natural Gas Ministry report which estimated that India’s crude oil import bill may increase 20% to $105 billion in this financial year from $88 billion in 2017-18, assuming average crude oil price of $65 per barrel for the year, about $9 a barrel less than the current rate.

Separately, metal stocks took a beating as investors turned cautious of falling aluminium prices. National Aluminium Company (NALCO) and Hindalco Industries plunged in today’s trade in line with a steep fall in the metal prices overseas. The prices dropped as news emerged that the US has extended the deadline for firms to wind up business with the sanctions-hit Russian producer Rusal. Americans engaged with Rusal now have until October 23 to close out their business with the aluminum giant. The US Treasury Department announcement gives Rusal longer time to sell off the aluminium it had been stockpiling in the wake of sanctions. Shares of Information Technology (IT) companies were under pressure as investors were cautious on reports that the Trump administration is planning to end allowing spouses of H1-B visa holders to work legally in the US, PTI reported. The move could have a devastating impact on tens of thousands of Indians. The move to end the Obama-era rule could have an impact on more than 70,000 H-4 visas holders, who have work permits.

On the global front, Asian markets closed mixed as investors waited to see if the dollar’s rally was sustainable. Inflation worries are also mounting as oil and commodity prices have been rising in recent weeks. The European markets were trading mostly in green as investors monitored the latest deluge of corporate earnings. German business confidence deteriorated for a fifth consecutive month in April, a survey indicated, in a further sign that Europe’s biggest economy is losing some of its momentum. The Munich-based Ifo economic institute said its business climate index, based on a monthly survey of companies, fell to 102.1 from 103.03 in March.

Back home, Reliance Naval and Engineering tumbled after auditors of the company raised doubts about the Anil Ambani-led company’s ability to continue as going concern. The assumption of going concern depends upon the approval of the company’s bankruptcy-related resolution plan by secured lenders, their ability to generate cash flows and profit. Ruchi Soya Industries closed in green amid reports that Baba Ramdev-led Patanjali Ayurved has joined the race to acquire the debt-ridden company. Ruchi Soya has a partnership with Patanjali for refining and packaging of edible oils.

The BSE Sensex ended at 34602.82, up by 152.05 points or 0.44% after trading in a range of 34465.49 and 34706.71. There were 17 stocks advancing against 14 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 0.07%, while Small cap index was down by 0.15%. (Provisional)

The top gaining sectoral indices on the BSE were Energy up by 2.36%, Oil & Gas up by 1.49%, Capital Goods up by 0.59%, Healthcare up by 0.37% and Bankex up by 0.34%, while IT down by 1.90%, Metal down by 1.76%, TECK down by 1.61%, Basic Materials down by 1.05% and Consumer Durables down by 0.65% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Reliance Industries up by 3.62%, Yes Bank up by 3.27%, Mahindra & Mahindra up by 1.88%, Adani Ports & Special Economic Zone up by 1.62% and ICICI Bank up by 1.61%. (Provisional)

On the flip side, Wipro down by 3.30%, Infosys down by 2.56%, TCS down by 1.00%, Tata Steel down by 0.94% and SBI down by 0.70% were the top losers. (Provisional)

Meanwhile, highlighting importance of Micro, Small and Medium Enterprises (MSMEs) in solving various problems such as gap between rich & poor and climate change, Union Minister of Commerce & Industry and Civil Aviation, Suresh Prabhu has said that MSME will also play a key role in employment generation thus countering jobless growth.

Prabhu highlighted that MSMEs will help in the reduction of Green House Gas emissions, as they are generally closer to markets leading to reduced carbon footprints. He also stressed on the relationship between big enterprises and MSMEs and added that the bigger companies cannot prosper without MSMEs, so there is need to strength linkages between big and small to propel the global economy.

The Minister further noted that new Industrial Policy, which will be announced soon, lays great stress on the role of Self Help Groups (SHGs) and emphasized that MSMEs can take advantage of the Start-up India Program. Besides, he suggested that new networks can be formed among MSMEs of different countries like Africa, Central Asia and Latin America, to promote their ideas at the global level as MSMEs are the crucible of creation of new ideas in the world of business.

The CNX Nifty ended at 10619.20, up by 34.50 points or 0.33% after trading in a range of 10569.00 and 10636.80. There were 30 stocks advancing against 20 stocks declining on the index. (Provisional)

The top gainers on Nifty were Reliance Industries up by 3.84%, Yes Bank up by 3.56%, Bajaj Finserv up by 2.83%, GAIL India up by 2.01% and Mahindra & Mahindra up by 1.87%. (Provisional)

On the flip side, Hindalco down by 7.43%, Wipro down by 3.46%, Tech Mahindra down by 3.08%, Infosys down by 2.84% and HCL Tech down by 2.37% were the top losers. (Provisional)

The European markets were trading mostly in green; UK’s FTSE 100 increased 18.99 points or 0.26% to 7,417.86, Germany’s DAX increased 48.73 points or 0.39% to 12,621.12, while France’s CAC decreased 2.96 points or 0.05% to 5,435.59.

Asian equity markets ended mixed on Tuesday as the underlying sentiments remained cautious amid renewed concerns over US interest rate hikes and ahead of a potential meeting in Beijing between officials from the world's largest and second-largest economies. Chinese stocks ended up after a top decision-making body of the ruling Communist Party said the country would strive hard to achieve this year's economic targets in the face of rising global trade tensions. Further, Japanese shares ended higher as a weaker yen on the back of increasing bond yields in the US helped lift exporters.