Markets make optimistic start on better-than-expected Q4GDP data

Indian equity benchmarks made an optimistic start and are trading in fine fettle in early deals on Friday, as traders took some encouragement with report that Indian economy grew at 7.7 percent during January-March quarter of financial year 2017-18 compared to 6.1 percent a year ago, driven by gains in manufacturing and consumer spending. However, the GDP growth for the entire fiscal of 2017-18 was at 6.7%, lower than 7.1 percent in 2016-17. Some support also came with report that eight infrastructure industries recorded 4.7 percent growth in April helped by healthy performance in segments like coal, natural gas and cement. The growth rate of eight core sectors, which also include fertilisers and steel, was 2.6 percent in April 2017. Adding to the optimism, Moody's Investors Service said that tax reforms are likely to expand revenue base in fast growing economies like India but they will be most effective when accompanied by lowering of fiscal deficit and effective management of expenditure.

On the global front, Asian markets are trading mostly in green at this point of time, as the political turmoil in Italy that roiled global financial markets showed signs of easing. The US markets ended lower on Thursday following news that the Trump administration plans to impose steel and aluminum tariffs on Canada, Mexico and the European Union.

Back home, India’s per capita income grew at a slower pace of 8.6 per cent to Rs 1,12,835 during the last fiscal ended March 2018. The per capita net national income in 2016-17 stood at Rs 1,03,870, witnessing a growth of over 10.3 per cent from the preceding fiscal ended March 2016 (at Rs 94,130). In scrip specific developments, Om Metals Infraprojects moved up on acquiring 49% stake in Om Metals Infraprojects LLC and Bajaj Auto soared on reporting 30% rise in May sales.

The BSE Sensex is currently trading at 35428.83, up by 106.45 points or 0.30% after trading in a range of 35267.81 and 35438.22. There were 18 stocks advancing against 12 stocks declining on the index, while 1 stock remained unchanged.

The broader indices were trading in red; the BSE Mid cap index slipped 0.18%, while Small cap index was down by 0.10%.

The top gaining sectoral indices on the BSE were Metal up by 1.04%, IT up by 0.63%, TECK up by 0.56%, Capital Goods up by 0.54% and Consumer Durables up by 0.54%, while Power down by 1.04%, Utilities down by 1.02%, PSU down by 0.57% and Oil & Gas was down by 0.53% were the few losing indices on BSE.

The top gainers on the Sensex were ICICI Bank up by 3.36%, Bajaj Auto up by 2.18%, Maruti Suzuki up by 1.45%, Larsen & Toubro up by 1.27% and Coal India up by 1.17%. On the flip side, Power Grid Corporation down by 2.13%, ONGC down by 2.09%, Adani Ports down by 1.93%, NTPC down by 0.99% and SBI down by 0.82% were the top losers.

Meanwhile, continuing its status as the world’s fastest-growing major economy, Indian economy beating all the estimates registered a growth of 7.7% for the fourth quarter of fiscal year 2017-18, highest in seven quarters. The growth was aided by rapid construction activity, manufacturing and consumer spending along with corporate investment. However, for the entire fiscal year, the economy grew at four-year low of 6.7%, as against growth of 7.1% in 2016-17. The previous low was recorded in 2013-14 at 6.4%.

As per the Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation data, real GDP or GDP at constant (2011-12) prices for the year 2017-18 is now estimated at Rs 130.11 lakh crore showing a growth rate of 6.7% over First Revised Estimates of GDP for the year 2016-17 of Rs 121.96 lakh crore, released on January 31, 2018. Besides, real GVA or  GVA at basic constant (2011-12) prices for the year 2017-18 is now estimated at Rs 119.76 lakh crore showing a growth rate of 6.5% over First Revised Estimates of GVA for the year 2016-17 of Rs 112.48 lakh crore, released on January 31, 2018.

Acocording to the data, GDP at current prices in Q4 of 2017-18 is estimated at Rs 45.34 lakh crore, as against Rs 40.90 lakh crore in Q4 of 2016-17, showing a growth of 10.9%. GVA at current basic prices in Q4 of 2017-18 is estimated at Rs 39.51 lakh crore, as against Rs 35.69 lakh crore in Q4 of 2016-17, showing a growth of 10.7%. Among the sectors, all core sectors clocked significant growth during Q4 of FY18, in comparison to the quarter before. During the March quarter, agriculture, manufacturing, and construction sectors grew at 4.5%, 9.1% and 11.5%, respectively. The financing, real estate and insurance segment registered a growth of 5%, while ‘Public administration, defence and other Services' grew at 13.3%.

GDP at current prices for the year 2017-18 is estimated at Rs 167.73 lakh crore, showing a growth rate of 10.0% over the First Revised Estimates of GDP for the year 2016-17 of Rs 152.54 lakh crore. Besides, Private Final Consumption Expenditure (PFCE) at current prices is estimated at Rs 99.14 lakh crore in 2017-18 as against Rs 90.05 lakh crore in 2016-17. Government Final Consumption Expenditure (GFCE) at current prices is estimated at Rs 19.08 lakh crore in 2017-18 as against Rs 16.64 lakh crore in 2016-17. Gross Fixed Capital Formation (GFCF) at current prices is estimated at Rs 47.79 lakh crore in 2017-18 as against Rs 43.52 lakh crore in 2016-17.

The CNX Nifty is currently trading at 10762.45, up by 26.30 points or 0.24% after trading in a range of 10716.40 and 10764.70. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were ICICI Bank up by 3.25%, Vedanta up by 2.92%, Bajaj Auto up by 2.28%, Indiabulls Housing up by 1.68% and Maruti Suzuki up by 1.48%. On the flip side, ONGC down by 2.61%, Power Grid Corporation down by 2.51%, Adani Ports down by 1.90%, GAIL India down by 1.70% and NTPC down by 1.37% were the top losers.

Asian markets are trading mostly in green; KOSPI Index gained 13.17 points or 0.54% to 2,436.18, Nikkei 225 added 46.42 points or 0.21% to 22,248.24 and Taiwan Weighted was up by 68.46 points or 0.63% to 10,943.42.

On the flip side, Hang Seng decreased 51.2 points or 0.17% to 30,417.36 and Shanghai Composite was down by 16.31 points or 0.53% to 3,079.16.