Post Session: Quick Review

Indian equity benchmarks ended Wednesday’s trade on a lower note, as traders remained on sidelines ahead of Futures and Options (F&O) derivative expiry for September series due tomorrow. Domestic indices made a positive start and traded marginally in green, as traders got some support with Finance Minister Arun Jaitley’s statement that the new insolvency law, indirect tax regime and demonetization will help drive India’s growth rate and sustain it at 8%. Investors also took note of the government’s data showing that fiscal deficit touched 94.7% of the FY18 estimate at end of August, marginally better than 96.1% at the same point last fiscal. In absolute terms, fiscal deficit at end of August was Rs 5.91 lakh crore.

Key indices soon pared all of their gains and took a turn towards the negative zone, as sentiments got spooked with a private report stating that even though India’s economy is growing at a fast pace, the ‘higher educated’ are reporting the highest rate of unemployment against the national average. The report also revealed that the unemployment scenario is most ‘severe’ in the northern states of the country. The market breadth remained pessimistic with another private report stating that after US, India is likely to suffer highest economic damage from climate change. The report further noted that Carbon dioxide emissions are costing the Indian economy up to $210 billion every year. However, domestic bourses managed to pare their losses in dying hour of trade as some optimism remained among the investors with the commerce and industry ministry’s statement that the government’s export promotion measures, implementation of minimum standards for imports, and continued healthy inflow of remittances by non-resident Indians will help control the country’s rising current account deficit (CAD).

On the global front, Asian markets ended mostly in green on Wednesday as investors awaited the United States Federal Reserve's monetary policy decision as well as the accompanying policy statement for clues about the outlook for interest rates. European markets were trading mostly in green.

Back home, majority of telecom stocks ended higher after the cabinet approved the new telecom policy, now named National Digital Communications Policy (NDCP) 2018, which aims to attract $100 billion investment and create 4 million jobs in the sector by 2022. However, sugar stocks ended lower despite the government approved a Rs 4,500 crore package for the sugar industry that includes over two-fold jump in production assistance to cane growers and transport subsidy to mills for export up to 5 million tonnes in the marketing year 2018-19.

The BSE Sensex ended at 36507.98, down by 144.08 points or 0.39% after trading in a range of 36357.93 and 36938.74. There were 12 stocks advancing against 19 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.32%, while Small cap index was up by 0.07%. (Provisional)

The top gaining sectoral indices on the BSE were Metal up by 1.78%, Realty up by 1.66%, Capital Goods up by 1.35%, Basic Materials up by 1.32% and Energy up by 1.10%, while IT down by 1.69%, TECK down by 1.54%, FMCG down by 1.44%, Auto down by 1.09% and Consumer Disc down by 0.38% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Vedanta up by 4.68%, Reliance Industries up by 1.71%, Yes Bank up by 1.61%, Tata Steel up by 1.59% and Larsen & Toubro up by 1.23%. (Provisional)

On the flip side, Tata Motors - DVR down by 3.41%, Tata Motors down by 3.18%, Wipro down by 2.81%, ITC down by 2.66% and SBI down by 2.63% were the top losers. (Provisional)

Meanwhile, with the help of better expenditure management, India’s fiscal deficit during the first five months (April-August) of the current fiscal (FY19) has shown improvement. The fiscal deficit stood at 94.7% of the Budget Estimate (BE) at August-end of FY19, better than 96.1% of BE at August-end of the last financial year.
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 5.91 lakh crore in the first five months period of 2018-19 financial year. Besides, the government has budgeted to cut fiscal deficit to 3.3% of GDP in 2018-19 from 3.53% in the previous year. The fiscal deficit target for 2018-19 is Rs 6.24 lakh crore.

According to the data, the tax collection (net) at end-August was Rs 3.66 lakh crore or 24.7% of BE. The total receipts of the government during April-August 2018 were Rs 4.79 lakh crore or 26.4% of BE. In the similar period of 2017-18, the collection was 26.6% of BE. Total expenditure during April-August 2018 was Rs 10.7 lakh crore or 43.8% of BE. The expenditure was lower as a percentage of BE in the year-ago period.

As per the Union Budget 2018-19, the revenue expenditure has been estimated at Rs 21.42 lakh crore. The CGA data showed that till August, the expenditure under the head was 43.8% (Rs 9.38 lakh crore) of BE, lower than 45.8% in the previous year. However, the capital expenditure was Rs 1.32 lakh crore or 44.1% of BE, higher over the previous year.

The CNX Nifty ended at 11044.30, down by 23.15 points or 0.21% after trading in a range of 10993.05 and 11145.55. There were 27 stocks advancing against 23 stocks declining on the index. (Provisional)

The top gainers on Nifty were Indiabulls Housing Finance up by 7.28%, UPL up by 5.64%, Vedanta up by 4.95%, Titan Co up by 2.39% and Hindalco up by 2.04%. (Provisional)

On the flip side, Tata Motors down by 3.11%, Bharti Infratel down by 2.86%, SBI down by 2.79%, ITC down by 2.71% and Wipro down by 2.53% were the top losers. (Provisional)

European markets were trading mostly in green; UK’s FTSE 100 increased 4.05 points or 0.05% to 7,511.61 and France’s CAC was up by 15.05 points or 0.27% to 5,494.15, while Germany’s DAX was down by 16.53 points or 0.13% to 12,358.13.

Asian markets ended mostly in green on Wednesday as investors awaited the United States Federal Reserve's monetary policy decision as well as the accompanying policy statement for clues about the outlook for interest rates. The Nikkei average rose as the dollar largely stuck to tight ranges ahead of the FOMC decision due tonight. Meanwhile, China stocks closed higher as global index provider MSCI said it will consider quadrupling the weighting of Chinese big-caps in its global benchmarks and as FTSE Russell is expected to include Chinese shares in its benchmark this week. The South Korean market remained closed for Chuseok Day holiday.