Benchmarks end on firm note; Nifty reclaims 10,750 mark

Indian equity benchmarks ended the Wednesday’s trade in green terrain with frontline gauges recapturing their crucial 35,500 (Sensex) and 10,750 (Nifty) levels. The markets started the session on firm note, aided by Economic Affairs Secretary Subhash Chandra Garg’s statement that it is a plausible aspiration for India and the country has also potential to become a $10 trillion economy by 2030. He added that this target is likely to be achieved with the help of a sustained average growth of 8% coupled with an assumed devaluation of Indian rupee vis-a-vis US dollar at Re one per year. Domestic sentiments also got boost with a private report stating that advancing gender parity could contribute $770 billion to India’s GDP by 2025. The market participants also took note of Moody’s latest report that non-financial corporates in the country may show modest improvement in their leverage levels in the current financial year, supported by higher revenue and earnings growth.

In the second half, the bourses continued their northward rally to end near their fresh intraday high points, after Prime Minister Narendra Modi said his government has doubled the Budget for agriculture to Rs 2.12 trillion (Rs 2.12 lakh crore) to achieve its objective of doubling farm income by 2022. Adding some comfort, Niti Aayog CEO Amitabh Kant said that the Centre has saved Rs 90,000 crore by digitally transferring money to beneficiaries of 440 government schemes. Some support also came with another private report that despite adverse impact on GST implementation, India saw a 20% increase in both the number of dollar millionaires and their wealth in 2017 to emerge as the fastest growing market for high net population. Investors paid no heed towards report that a 200-basis-point increase in interest rates could cause a sharp rise in emerging-market corporate debt at risk of default, with Brazilian and Indian companies most vulnerable.

On the global front, European markets were trading in green, as investors took trade tensions in their stride and looked ahead to Bank of England and OPEC meetings for direction. While the Bank of England is unlikely to alter the status quo on rates on Thursday, the ministers of OPEC and non-OPEC countries may put forward proposals to increase production when they meet in Vienna on Friday. Further, Asian markets ended in green, as investors sought bargains, a day after the spectre of a US-China trade war drove down bond yields, and share and commodity prices.

Back home, banking stocks ended in green terrain, supported by a report stating that the Centre decided to adopt a two-pronged approach to improve functioning of public sector banks (PSBs) by ‘ironing out issues of consortium-based lending’ and identifying ‘good borrowers.’ However, the aviation related stocks ended lower despite the Directorate General of Civil Aviation’s (DGCA) data indicating that domestic air passenger traffic grew 16.53% to 11.86 million in May this year over the same period a year ago. It added that 12 domestic airlines together flew 11.85 million passengers as compared to 10.17 million passengers in May 2017.

Finally, the BSE Sensex jumped 260.59 points or 0.74% to 35,547.33, while the CNX Nifty was up by 61.60 points or 0.58% to 10,772.05.

The BSE Sensex touched a high and a low of 35,571.37 and 35,329.51, respectively and there were 25 stocks on gaining side as against 6 stocks on losing side on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.23%, while Small cap index was up by 0.27%.

The top gaining sectoral indices on the BSE were Metal up by 1.09%, Bankex up by 1.04%, Energy up by 1.02%, Realty up by 0.83% and Utilities up by 0.69%, while FMCG down by 0.36%, Capital Goods down by 0.28%, Oil & Gas down by 0.27%, PSU down by 0.27% and Industrials down by 0.18% were the top losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 2.44%, Indusind Bank up by 2.27%, Vedanta up by 2.10%, Yes Bank up by 1.66% and Kotak Mahindra Bank up by 1.58%. On the flip side, ONGC down by 1.24%, Coal India down by 0.92%, ITC down by 0.90%, Wipro down by 0.71% and Larsen & Toubro down by 0.54% were the top losers.

Meanwhile, amid higher fares on rising fuel prices, the domestic air passenger traffic registered slightly lower growth of 16.53% in the month of May. According to the Directorate General of Civil Aviation (DGCA) data, domestic airlines flew 118.56 lakh passengers in May, over to 101.74 lakh passengers carried in the same period last year.

The data also showed that the domestic air passenger count has gone up by 22.69% during January-May 2018. Indian carriers carried 571.58 lakh passengers during period under review as against 465.87 lakh during the corresponding period of previous year. Besides, in terms of passenger load factor (PLF), SpiceJet were leading among all with 94.8% PLF during the month of May 2018, followed by IndiGo (91%) and AirAsia India (89.7%).

In terms of on time performance (OTP), IndiGo has taken lead from the rest with 80.9% of its flights arriving and departing as per schedule from four metro airports, Mumbai, Delhi, Hyderabad and Bengaluru, followed by SpiceJet (80.0%) and Vistara (76.7%). During May 2018, a total of 724 passenger related complaints had been received by the scheduled domestic airlines. The number of complaints per 10,000 passengers carried for the month of May 2018 has been around 0.61.

The CNX Nifty traded in a range of 10,781.80 and 10,724.05. There were 29 stocks in green as against 20 stocks in red, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Reliance Industries up by 2.32%, Indusind Bank up by 2.20%, Tata Steel up by 1.89%, Kotak Mahindra Bank up by 1.75% and Vedanta up by 1.72%. On the flip side, UPL down by 3.28%, HPCL down by 1.65%, Indian Oil Corporation down by 1.51%, ONGC down by 1.37% and HCL Technologies down by 1.30% were the top losers.

The European markets were trading in green; Germany’s DAX gained 64.85 points or 0.51% to 12,742.82, France’s CAC increased 23.28 points or 0.43% to 5,413.91 and UK’s FTSE 100 was up by 90.05 points or 1.17% to 7,693.90.

Asian equity markets ended mostly higher on Wednesday as investors took trade tensions in their stride and looked ahead to the Bank of England monetary policy meeting Thursday and Friday's OPEC meeting for directional cues. Chinese shares closed higher after the People's Bank of China said in a working paper that China should appropriately reduce its reserve requirements to ease burdens on financial institutions and smooth the interest rate transmission mechanism. The central bank also injected funds into the financial system via its medium-term lending facility to offset liquidity pressure. Further, Japanese shares ended higher as the dollar rose against the yen.