Northward Journey continues on D-Street

Northward journey continued on the Dalal Street in late afternoon session, with the both the larger peers, the Sensex and Nifty, gaining around 1.50% each.  Gaining momentum also continued in broader markets, with indices like Consumer Durables and Capital Goods witnessing heavy buying. Relief spread on the street, after IMF Director of Fiscal Affairs Department said that India's debt is lower than the best or emerging market economies in the world. He cautioned that the global debt has reached a new record high of $182 trillion in 2017. Optimism remained among the traders, with report that the Reserve Bank of India (RBI) will inject Rs 12,000 crore liquidity into the system through purchase of government bonds on October 11, in order to meet the festival season demand for funds. Traders paid no heed towards a private report stating that India's retail inflation likely sped up in September on higher food and fuel costs, pushed up by a battered rupee and suggesting further policy tightening from the RBI.

On the global front, European markets were trading in red, as German exports declined for a second straight month in August, defying expectations for an increase The preliminary data from the statistical office Destatis showed that merchandise exports fell a calendar and seasonally-adjusted 0.1% from July, when they decreased 0.8%. Street had expected a 0.4% increase. Asian markets were trading in green, even though the International Monetary Fund cut global economic growth forecasts for 2018 and 2019, saying the US and China would feel the brunt of the impact of their trade war next year. Elsewhere, China stepped up its war of words with the US and said it had not initiated the trade war, but only responded in self-defence. Back home, in scrip specific development, Bandhan Bank gained on reporting 47.29% rise in its net profit at Rs 487.65 crore for the quarter ended September 30, 2018 as compared to Rs 331.09 crore for the same quarter in the previous year.

The BSE Sensex is currently trading at 34786.04, up by 486.57 points or 1.42% after trading in a range of 34346.50 and 34858.35. There were 25 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 3.91%, while Small cap index was up by 3.25%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 3.77%, Capital Goods up by 3.39%, Bankex up by 3.38%, Industrials up by 3.16% and Consumer Disc up by 3.01%, while, IT down by 1.51% and TECK down by 1.12% were the only losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 6.10%, Maruti Suzuki up by 4.87%, SBI up by 4.59%, Yes Bank up by 4.31% and ICICI Bank up by 4.20%. On the flip side, Infosys down by 2.72%, TCS down by 1.72%, Wipro down by 1.23%, Sun Pharma down by 1.16% and Coal India down by 0.70% were the top losers.

Meanwhile, few days after Reserve bank of India (RBI) chose not to raise rates, the International Monetary Fund (IMF) has batted for further monetary policy tightening in order to anchor expected rise in inflation.

As per IMF estimates, Indian inflation may surge to 4.7% in 2018-19 from 3.6% in 2017-18, because of accelerating demand  along with rising fuel prices. The multilateral agency further pointed that core inflation of India, excluding all food and energy items, had risen to about 6% as a result of a narrowing output gap and pass-through effects of higher energy prices and exchange rate depreciation.

Globally, IMF expects interest rates to rise in advanced economies from the current still-accommodative levels. It also noted that emerging market and developing economies should be prepared for an environment of higher volatility, amid rising trade tensions.

The CNX Nifty is currently trading at 10463.55, up by 162.50 points or 1.58% after trading in a range of 10318.25 and 10479.65. There were 42 stocks advancing against 8 stocks declining on the index.

The top gainers on Nifty were Bajaj Finance up by 10.70%, Bajaj Finserv up by 8.49%, Eicher Motors up by 8.04%, Axis Bank up by 6.18% and Titan Co up by 5.50%. On the flip side, Bharti Infratel down by 2.74%, Infosys down by 2.57%, HCL Tech. down by 2.28%, Wipro down by 1.97% and TCS down by 1.81% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 increased 36.65 points or 0.16% to 23,506.04, Hang Seng added 20.16 points or 0.08% to 26,193.07, Shanghai Composite gained 4.83 points or 0.18% to 2,725.84 and Jakarta Composite surged 23.88 points or 0.41% to 5,820.67. On the flip side, KOSPI decreased 25.22 points or 1.13% to 2,228.61 and Straits Times was down by 31.70 points or 1.01% to 3,134.90.

All European markets were trading in red; UK’s FTSE 100 decreased 6.64 points or 0.09% to 7,230.95, France’s CAC dipped 38.97 points or 0.74% to 5,279.58 and Germany’s DAX was down by 68.83 points or 0.58% to 11,908.39.