Post Session: Quick Review

Indian equity benchmarks altered between positive and negative territory and ended on a flat note on Wednesday as the street turned cautious ahead Consumer Price Index-based (CPI) inflation and Index of Industrial Production data slated to be announced tomorrow. Domestic bourses made a cautious start and traded with marginal losses, as traders remained concerned with India’s G-20 Sherpa Shaktikanta Das, expressing concern over increasing protectionism and trade conflicts across the world, said that countries ought to work out arrangements that are beneficial to all in the larger interest of reviving global growth. However, some buying crept in as traders found some solace with report that the Global Innovation Index (GII) has ranked India as the 57th most innovative nation in the world. The country has improved its ranking from 60th position last year. India has been improving steadily since it was ranked 81st in 2015. Some comfort also came with union minister for electronics and IT Ravi Shankar Prasad’s statement that India is the third largest investor in the United Kingdom and emerged as the second largest international job creator with Indian companies having created over 110,000 jobs in the UK in recent months. Although, gains remained capped as anxiety remained amongst the traders with a private report stating that Indian inflation likely rose to a near two-year high in June, driven by surging oil and food prices, a development that would strengthen calls for more monetary policy tightening by the Reserve Bank of India.

On the global front, Asian markets ended mostly in red, following the release of a list of an additional $200 billion in Chinese goods on which the U.S. is considering imposing tariffs. European markets were trading in red in early deals on Wednesday, after U.S. authorities unveiled a new list of Chinese products that could see tariffs.

Back home, Telecom stocks ended lower despite ICRA stating that Indian telecom industry, which is witnessing intense competition and pricing pressures, is likely to stabilize in a few quarters. It also said that as the competitive intensity is expected to moderate as the merged Vodafone and Idea stabilize, and the subscriber base of the existing operators diminishes.  Furthermore, Textile sector was in limelight after the Gujarat government finally announced a new scheme for the employment-intensive textile sector, under which a part of the SGST (state goods & services tax) will be reimbursed, in lieu of VAT incentives promised in the Textile Policy 2012.

The BSE Sensex ended at 36248.20, up by 8.58 points or 0.02% after trading in a range of 36169.70 and 36362.30. There were 11 stocks advancing against 20 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 0.69%, while Small cap index was down by 0.37%.(Provisional)

The top gaining sectoral indices on the BSE were IT up by 2.18%, TECK up by 1.74%, Realty up by 0.55%, FMCG up by 0.37%, Energy up by 0.34% while, Metal down by 3.07%, Basic Materials down by 1.68%, PSU down by 1.48%, Auto down by 0.96%, Telecom down by 0.92% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were TCS up by 5.17%, Bajaj Auto up by 2.30%, Hindustan Unilever up by 1.59%, Reliance Industries up by 1.17% and Infosys up by 1.00%. (Provisional)

On the flip side, Coal India down by 4.59%, Vedanta down by 3.41%, Tata Motors down by 2.74%, Tata Steel down by 2.27% and Tata Motors - DVR down by 2.21% were the top losers. (Provisional)

Meanwhile, India’s G-20 Sherpa Shaktikanta Das has expressed concern over increasing protectionism and trade conflicts across the world and said countries ought to work out arrangements that are beneficial to all in the larger interest of reviving global growth. He added that global growth has taken a downward turn in the aftermath of 2008 financial crisis. Then advanced economies were under pressure because of subsequent developments. Financial crisis was followed by debt crisis in PIGS countries (Portugal, Italy, Greece and Spain). It was followed by Eurozone crisis. He also said that there was another major event like Britain deciding to exit the European Union, putting further pressure on global growth.

Das further said ‘But now I think in recent months, the US economy as well as European economies are showing signs of revival. On the whole, the global economy appears to be in revival mode. Therefore, at this juncture, any trade conflict which goes beyond a certain point will definitely have negative impact on global growth’. He further said that free trade has been responsible for sustained global growth over the years and added that protectionist tendencies going beyond a point, naturally will have adverse consequences on world economy.

Highlighting that the world economy cannot afford another era of slow growth, the former Economic Affairs Secretary said therefore it is necessary that all countries act in a spirit of cooperation and resolve -- the trade issue bilaterally or multilaterally. He also noted that some of the trade issues are bilateral in nature and unless they are resolved the global economy faces negative prospect of growth slowing down. He added in that background, the negotiations taking place under the aegis of World Trade Organisation (WTO), among the trade ministers assumes very great significance and countries work out arrangements which are beneficial to all.

The CNX Nifty ended at 10945.85, down by 1.40 points or 0.01% after trading in a range of 10923.00 and 10976.65. There were 18 stocks advancing against 32 stocks declining on the index. (Provisional)

The top gainers on Nifty were TCS up by 5.06%, Bharti Infratel up by 3.18%, Bajaj Auto up by 2.43%, Hindustan Unilever up by 1.83% and Infosys up by 1.31%. (Provisional)

On the flip side, UPL down by 5.40%, Coal India down by 4.67%, Hindalco down by 3.67%, Vedanta down by 3.47% and Tata Motors down by 2.81% were the top losers. (Provisional)

European markets were trading in green; Germany’s DAX decreased 155.82 points or 1.25% to 12,454.03, UK’s FTSE 100 was down by 59.87 points or 1.11% to 5,374.49 and France’s CAC shed 105.09 points or 0.39% to 7,586.95.

Asian equity markets ended mostly lower on Wednesday due to selling pressure after the US proposed tariffs on an extra $200 billion of Chinese goods and China vowed to take countermeasures, without elaborating further. Chinese shares ended lower and the yuan drifted lower on worries the ongoing trade row could hurt economic growth. Further, Japanese shares ended lower to snap a three-day winning streak as fears about the global economic outlook due to the escalating trade war weighed on shippers and machinery makers. Core machine orders in Japan fell 3.7 percent sequentially in May, the Cabinet Office said - coming in at 907.9 billion yen. The headline figure beat expectations for a decline of 4.9 percent following the 10.1 percent spike in April. On a yearly basis, machine orders surged 16.5 percent - again topping forecasts for 10.9 percent following the 9.6 percent jump in the previous month.