Post Session: Quick Review

Indian equity benchmarks traded between green and red terrain throughout the session and ended Wednesday’s trade on pessimistic note. Markets snapped four sessions record hitting spree with Sensex and Nifty slipping below their crucial 37,500 and 11,350 levels, respectively. Markets started off with marginal gains as traders took encouragement with the commerce and industry ministry’s data showing that growth of eight core sectors expanded to 7-month high of 6.7% in June on the back of better performance by cement, refinery and coal segments. Investors also got some support with a private report that the Indian economy is likely to have witnessed solid economic growth in the April-June quarter but leading indicators suggest a slowdown in the coming months. The report stated that GDP growth to peak in April-June quarter and then moderate to 7.2% in the second half of 2018 from around 7.8% in first half.

However, selling which intensified in last leg of trade mainly forced markets to end their record run. Market-men got anxious after Reserve Bank of India (RBI) increased its benchmark repo rate by 25 basis points to 6.50%. Some pessimism also spread among the investors with a report showing that growth in India's manufacturing industry slowed last month, largely pressured by a modest weakening in demand and output, though overall conditions remained solid. The Nikkei Manufacturing Purchasing Managers' Index, compiled by IHS Markit, decreased to 52.3 in July from June's 53.1. Market participants also remained worried with the Minister of State for Finance Shiv Pratap Shukla indicting that gross bad loans in Indian banks surged to more than Rs 9.61 lakh crore by the end of 2017-18, while loans to industries formed a major chunk of such non-performing assets.

On the global front, Asian markets ended mixed, while European markets were trading in red in early deals on Wednesday, as investors remained focused on the Federal Reserve's monetary policy decision later today and the BoE's 'Super Thursday' event. Back home, stocks related to banking sector ended lower despite S&P Global Ratings stating that India’s weak banking system will strengthen over couple of years as stressed loans are cleared and capital base expanded by government’s fund infusion in state-owned lenders. Besides, auto sector was in limelight as companies report their sales number today.

The BSE Sensex ended at 37467.23, down by 139.35 points or 0.37% after trading in a range of 37437.63 and 37711.87. There were 14 stocks advancing against 17 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index rose 0.12%, while Small cap index was up by 0.12%. (Provisional)

The top gaining sectoral indices on the BSE were Healthcare up by 1.02%, Oil & Gas up by 0.92%, Consumer Durables up by 0.76%, Energy up by 0.74% and FMCG up by 0.67%, while Auto down by 0.88%, Bankex down by 0.86%, Metal down by 0.60%, Telecom down by 0.54% and Consumer Disc down by 0.40% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Coal India up by 3.31%, TCS up by 1.64%, Sun Pharma up by 1.21%, ITC up by 1.19% and Power Grid up by 0.93%. (Provisional)

On the flip side, ICICI Bank down by 2.20%, Maruti Suzuki down by 1.83%, Vedanta down by 1.69%, Tata Steel down by 1.56% and Bharti Airtel down by 1.55% were the top losers. (Provisional)

Meanwhile, India’s fiscal deficit at the end of first three months of current financial year (FY19) stood at 68.7% of the Budget Estimate (BE) for 2018-19. It improved compared to the year-ago period, when it was 80.8% of the target. The improvement was mainly on account of higher revenue collection. The Controller General of Accounts’ (CGA) data showed that in actual terms, the fiscal deficit or gap between the total expenditure and receipts was Rs 4.29 lakh crore. The fiscal deficit target for FY19 is Rs 6.24 lakh crore.

According to the data, the tax collection at end-June was Rs 2.37 lakh crore or 16% of the BE. The total receipts of the government were Rs 2.78 lakh crore during April-June quarter or 15.3% of the BE. In the similar period of 2017-18, the collection was 13.1% of the BE. Total expenditure during the first three months of the fiscal was Rs 7.07 lakh crore or 29% of the BE. The expenditure was marginally higher as a percentage of BE in the last fiscal. The capital expenditure was Rs 86,988 crore or 29% of the BE.

The fiscal deficit is the gap between total spending and revenue and is a measure of the government’s market borrowing. Besides, the government had budgeted to cut fiscal deficit to 3.3% of Gross Domestic Product (GDP) in the current fiscal, from 3.53% in 2017-18.

The CNX Nifty ended at 11330.60, down by 25.90 points or 0.23% after trading in a range of 11313.55 and 11390.55. There were 26 stocks advancing against 24 stocks declining on the index. (Provisional)

The top gainers on Nifty were Coal India up by 3.83%, Bharti Infratel up by 2.34%, Dr. Reddys Lab up by 2.31%, Lupin up by 2.31% and Indian Oil Corporation up by 2.19%. (Provisional)

On the flip side, Hindalco down by 2.48%, ICICI Bank down by 2.14%, Maruti Suzuki down by 1.98%, Eicher Motors down by 1.90% and Vedanta down by 1.71% were the top losers. (Provisional)

European markets were trading in red; UK’s FTSE 100 shed by 71.50 points or 0.93% to 7,677.26, France’s CAC was down by 1.28 points or 0.02% 5,510.02 and Germany’s DAX dropped by 40.71 points or 0.32% to 12,764.79.

Asian equity markets ended mixed on Wednesday as Chinese manufacturing data disappointed and investors remained focused on the US Federal Reserve's monetary policy decision due later in the day. The Federal Reserve is widely expected to leave interest rates unchanged, but the accompanying statement may offer clues about the outlook for US interest rates. Traders also digested news that the Trump administration is considering more than doubling its planned tariffs on $200 billion in Chinese imports. Chinese shares ended lower after the release of weak data. The manufacturing sector in China continued to expand in July, albeit at a slower pace, the latest survey from Caixin revealed with a PMI score of 50.8, down from 51.0 in June. Meanwhile, Japanese shares closed higher on weaker yen and upbeat corporate earnings results from the likes of Sharp, Sony and Nintendo.