Post Session: Quick Review

Indian equity benchmarks continued their record hitting spree for the third consecutive session, crossing their crucial 11,300 (Nifty) and 37,400 (Sensex) bastions for the first time ever on Monday. Heavy buying in last leg of trade mainly helped the benchmarks to end higher. Markets started the day on optimistic note and traded in fine fettle, as traders took some encouragement with report that foreign investors have put in over Rs 1,800 crore in the Indian equity markets so far in July after pulling out massive funds in the preceding month. The latest inflow comes after such investors had taken out more than Rs 20,000 crore from the stock market during April-June. However, key indices erased gains and turned into negative terrain, as market-men got anxious with private report that the RBI’s rate-setting panel will go for a status quo on key policy rates at the August monetary policy review.

But, the selling proved short-lived as markets once again entered into green terrain and gained traction, due to hefty buying witnessed in Telecom, PSU and Energy stocks. Investors also took note of Niti Aayog CEO Amitabh Kant’s statement that the country needs to improve its human development index (HDI) to achieve a growth of around 10 per cent. Traders overlooked rating agency Moody’s report stating that the recent Goods and Services Tax (GST) rate cuts on 88 items will weigh on government’s revenue collection and is ‘credit negative’ as it will put pressure on efforts of fiscal consolidation.

On the global front, Asian markets ended mostly in red, with investors wary as the Bank of Japan and other central banks hold policy meetings this week.  European markets were trading in red in early deals on Monday, on the back of a disappointing session in the U.S. and amid further earnings reports. Back home, ACs and televisions manufacturers were in focus after Union Minister Arun Jaitley exuded confidence that GST rates on cement, ACs and televisions will be cut as tax revenues increase, and only luxury and sin goods will attract the highest slab of 28 per cent. Agriculture related stocks were in limelight after Union Minister of State for Finance Shiv Pratap Shukla stated that the government is making concerted efforts to double the farmers’ income by 2022.

The BSE Sensex ended at 37462.55, up by 125.70 points or 0.34% after trading in a range of 37292.45 and 37533.50. There were 17 stocks advancing against 14 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.29%, while Small cap index was up by 0.51%. (Provisional)

The top gaining sectoral indices on the BSE were Telecom up by 3.50%, PSU up by 2.18%, Energy up by 1.29%, Bankex up by 1.29% and Power up by 1.13%, while IT down by 0.70%, Capital Goods down by 0.17%, TECK down by 0.14% and Industrials down by 0.06% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Bharti Airtel up by 6.65%, ICICI Bank up by 4.84%, SBI up by 3.61%, Axis Bank up by 2.67% and Mahindra & Mahindra up by 2.40%. (Provisional)

On the flip side, Infosys down by 1.53%, HDFC Bank down by 1.43%, Adani Ports &SEZ down by 1.33%, HDFC down by 1.29% and Tata Motors - DVR down by 1.24% were the top losers. (Provisional)

Meanwhile, in order to achieve growth rate of around 10%, Niti Aayog CEO Amitabh Kant has said that India needs to improve its human development index (HDI). In the 2016 UN Human Development Report, India had slipped one place to rank 131st among 188 countries in the HDI.

Kant said ‘We are growing at around 7.5% and if our ambition is to grow at high rates like 10% over a three-decade period, (then) it is not possible to do this if we don’t improve the HDI for India’. He added that such growth was not possible if infant-mortality and maternal-mortality rates were at very high rates and if one in three children was stunted. Stating that there were around 200 backward districts in India, he underlined that it was not possible for the government alone to transform. Therefore, he said non-governmental organisations (NGOs) play a very important role.

Recently, Niti Aayog CEO had said that for India to grow at 9-10% for three decades consistently and reap the dividend of demographic advantage, promoting entrepreneurship among women has to be the key strategy. Noting that whenever the opportunity has been provided to women they have performed much better than men, he said, ‘Our belief is that if you want to transform India, then you need to give a huge fillip to women entrepreneurship’.

The CNX Nifty ended at 11312.75, up by 34.40 points or 0.31% after trading in a range of 11261.45 and 11328.10. There were 27 stocks advancing against 23 stocks declining on the index. (Provisional)

The top gainers on Nifty were Bharti Airtel up by 5.54%, ICICI Bank up by 4.84%, SBI up by 3.40%, Axis Bank up by 2.89% and Ultratech Cement up by 2.80%. (Provisional)

On the flip side, HDFC Bank down by 1.70%, Infosys down by 1.63%, HCL Tech. down by 1.61%, HDFC down by 1.53% and Bajaj Finance down by 1.46% were the top losers. (Provisional)

European markets were trading in red; UK’s FTSE 100 dropped by 24.21 points or 0.32% to 7,677.10, Germany’s DAX shed by 30.72 points or 0.24% to 12,829.68 and France’s CAC was down by 19.24 points or 0.35% to 5,492.52.

Asian equity markets closed mostly lower on Monday after technology stocks led a slide in US stocks on Friday. The dollar held steady against its peers while oil traded mixed after the release of US GDP data and amid renewed concerns around the US-China trade war. Meanwhile, investors shifted their focus to key central bank meetings this week. The Bank of Japan (BoJ) began a two-day policy meeting today, with expecting the central bank to discuss reducing investments in ETFs tracking the Nikkei 225 index. The Federal Open Market Committee is widely expected to leave interest rates unchanged when it meets on Tuesday and Wednesday. Chinese stocks ended lower, dragged down by healthcare stocks after Changchun Changsheng Bio-technology became the latest pharmaceutical company to be embroiled in a vaccine scandal. Further, Japanese shares closed down as investors awaited cues from the BoJ meeting and the next batch of corporate earnings.