Sensex, Nifty trade in fine fettle; Telecom stocks ring loud

Indian equity benchmarks are trading in fine fettle in late afternoon session, with Sensex gaining around 100 points, aided by positive cues from European markets. Markets in noon deals wiped out all of their gains and touched neutral lines for short period of time. But, heavy buying at Telecom, TECK and IT counters coupled with gains led by major industry leaders such as Coal India, TCS and Maruti Suzuki, helped the key indices to erase all of their losses. Some optimism also came with MSME secretary A K Panda’s statement that the credit guarantee to the micro and small enterprises (MSEs) sector will double to over Rs 40,000 crore this fiscal under the Credit Guarantee Fund Trust for MSE. Adding some comfort, Prime Minister Narendra Modi said that the rising crude prices have not resulted in a spike in inflation and the macroeconomic fundamentals of the country remain strong.

However, upside remained capped amid reports that Indian companies’ investments into their overseas subsidiaries/joint ventures have dropped by 63% to $1.17 billion in May 2018 as compared to $3.12 billion in May 2017. Separately, Former Finance Minister P Chidambaram slammed the government for terming the Goods and Services Tax (GST) as a ‘celebration of honesty’, saying if that was the case, why did the BJP oppose it for five years prior to coming to power in 2014.

On the global front, European markets were trading in green, rebounding after trade concerns caused a sharp sell-off for global markets in the previous session. However, Asian markets were trading in red. Back home, in scrip specific development, Info Edge (India) traded jubilantly on entering into an agreement with SVF India Holdings (Cayman) (Soft Bank), a wholly owned subsidiary of SoftBank Vision Fund L.P., of which SoftBank Group Corp. is a limited partner, whereby Soft Bank has agreed to invest an amount equivalent to about $45 million for 49.99% stake (on a fully diluted basis) in Diphda Internet Services (Diphda), a wholly owned-subsidiary of the company, for the time being.

The BSE Sensex is currently trading at 35565.67, up by 95.32 points or 0.27% after trading in a range of 35338.09 and 35600.77. There were 23 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.16%, while Small cap index was down by 0.48%.

The top gaining sectoral indices on the BSE were Telecom up by 1.08%, TECK up by 1.02%, IT up by 0.95%, FMCG up by 0.77% and Consumer Durables up by 0.40%, while Energy down by 1.01%, Realty down by 0.81%, Industrials down by 0.50%, Metal down by 0.38% and Healthcare down by 0.35% were the top losing indices on BSE.

The top gainers on the Sensex were Coal India up by 2.66%, TCS up by 2.16%, Maruti Suzuki up by 1.87%, Bharti Airtel up by 1.71% and Adani Ports & SEZ up by 1.36%. On the flip side, Tata Motors down by 4.16%, Tata Steel down by 2.46%, Reliance Industries down by 2.24%, Tata Motors - DVR down by 2.10% and ICICI Bank down by 0.85% were the top losers.

Meanwhile, amid various structural reforms along with the government’s decision to allow NBFCs to lend, MSME secretary A K Panda has expressed confidence that the credit guarantee to the micro and small enterprises (MSEs) sector would double to over Rs 40,000 crore during 2018-19 under the Credit Guarantee Fund Trust for MSE from almost Rs 19,000-20,000 crore reported in the last 2-3 years.   Besides, he added that the efforts will also be taken to touch it around Rs 50,000 crore.

MSME secretary expressed need of timely and low-cost credit for the micro, small and medium enterprises sector. Panda further said that the different ways to utilise non-budgetary instruments will be explored by the government, adding that the growth rate of non-performing assets (NPAs) in the micro and small sector is much lower than the other sectors.

He underlined the improved situation after the finance ministry processed GST refunds due to exporters.  He also pointed out a decision taken by the Union Cabinet earlier to provide loan assistance of up to Rs 1 crore to entrepreneurs as a second dose under the Prime Minister's Employment Generation Programme and noted that this move will act as a huge incentive for those setting up new units.

The CNX Nifty is currently trading at 10783.85, up by 21.40 points or 0.20% after trading in a range of 10732.55 and 10801.55. There were 36 stocks advancing against 13 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Coal India up by 2.68%, Ultratech Cement up by 2.51%, Grasim Industries up by 2.23%, TCS up by 2.23% and Hindalco up by 2.04%. On the flip side, Tata Motors down by 4.15%, Tata Steel down by 2.52%, Reliance Industries down by 2.27%, Cipla down by 1.91% and Bajaj Finance down by 1.72% were the top losers.

Asian markets are trading mostly in red; Hang Seng dropped 79.99 points or 0.28% to 28,881.40, Taiwan Weighted slipped 44.29 points or 0.41% to 10,742.17, KOSPI decreased 6.96 points or 0.30% to 2,350.92, Shanghai Composite was down by 14.68 points or 0.52% to 2,844.66 and Jakarta Composite fell by 6.81 points or 0.12% to 5,852.27. On the flip side, Straits Times was up by 17.44 points or 0.53% to 3,278.28 and Nikkei 225 added 3.85 points or 0.02% to 22,342.00.

All European markets were trading in green; UK’s FTSE 100 gained 36.67 points or 0.49% to 7,546.51, France’s CAC increased 18.90 points or 0.36% to 5,302.76 and Germany’s DAX was up by 45.92 points or 0.37% to 12,316.25.