Post Session: Quick Review

Indian equity benchmarks ended the lackluster day of trade marginally in red on Thursday, with frontline gauges swinging between red and green terrain throughout the session. After making positive start, markets erased most of their early gains and traded flat, as traders remained cautious with the commerce and industry ministry’s data showed that growth of eight infrastructure sectors slowed down to 4.3% in September, the lowest in the last four months, as production of crude oil and natural gas declined. Some cautiousness also came with a private report stating that India, which is the second-most populated nation in the world and on the verge of becoming the youngest country, will start ageing in next 15 years. This 15-year window is the best time to create job opportunities and capitalize on country’s rich demographic dividend.

However, losses remained capped as traders found some solace with survey report that the Indian manufacturing sector strengthened further in the month of October, on account of stronger order inflows and job creation. The Nikkei India Manufacturing Purchasing Managers’ Index (PMI) - a composite single-figure indicator of manufacturing performance - improved to 53.1 in October from 52.2 in September. Some comfort also came with report that India jumped 23 spots in the World Bank’s ease of doing business ranking to 77th place, becoming the top ranked country in South Asia for the first time and third among the BRICS. As per the report, the biggest gain was in construction permit where India climbed 129 ranks to 52nd place on the back of targeted government effort to remove hurdles. Traders took note of Industry chamber FICCI’s statement that more measures are needed to make adequate liquidity available in the system and strengthen the financial sector for attaining 8% plus gross domestic product (GDP) growth.

On the global front, Asian markets ended mixed on Thursday, as traders wondered if the Chinese government could shore up its economy without weakening the yuan as manufacturing slows. European markets were trading mostly in green, as investors monitored another batch of earnings results. Back home, pharmaceutical industries stocks ended lower, despite India Ratings and Research (Ind-Ra) in its latest report said that pharmaceutical industry in India is likely to register higher margins in Q2 (July- September) of 2018-19 on a year-on-year basis, on the back of rupee’s depreciation against the US dollar.

The BSE Sensex ended at 34416.53, down by 25.52 points or 0.07% after trading in a range of 34303.38 and 34679.93. There were 15 stocks advancing against 16 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index rose 1.05%, while Small cap index was up by 1.06%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 2.34%, Capital Goods up by 2.01%, Basic Materials up by 1.76%, Industrials up by 1.50% and Metal up by 1.47%, while IT down by 1.73%, TECK down by 1.54%, FMCG down by 0.81%, Healthcare down by 0.63% and Energy down by 0.11% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Yes Bank up by 8.14%, Indusind Bank up by 3.06%, Axis Bank up by 3.02%, Larsen & Toubro up by 2.09% and SBI up by 1.78%. (Provisional)

On the flip side, Infosys down by 2.72%, Coal India down by 1.99%, NTPC down by 1.44%, Sun Pharma down by 1.28% and Asian Paints down by 0.78% were the top losers. (Provisional)

Meanwhile, India has improved its ranking on the World Bank's ‘ease of doing business’ report for the second straight year. In its annual 'Doing Business' 2019 report, World Bank (WB) said India jumped 23 places to rank 77th position on the back of reforms related to insolvency, taxation and other areas. Last year, India was ranked 100th in the World Bank's Doing Business report. As per the report, India improved its rank on 6 out of the 10 parameters relating to starting and doing business in a country. These parameters include ease of starting a business, construction permits, getting electricity, getting credit, paying taxes, trade across borders, enforcing contracts and resolving insolvency. The most dramatic improvements have been registered in the indicators related to 'Construction Permits' and 'Trading across Borders'.

The report said New Zealand tops the list of 190 countries in ease of doing business, followed by Singapore, Denmark, and Hong Kong. The United States is placed eight and China has been ranked 46th. Neighbouring Pakistan is placed at 136. World Bank put India among the top 10 economies to make the most improvements. Observing that the two economies with the largest populations, China and India, demonstrated impressive reform agendas, the World Bank said India also focused on streamlining business processes. It added that India made starting a business easier by integrating multiple application forms into a general incorporation form. India also replaced the value-added tax with the Goods and Services Tax (GST) for which the registration process is faster.

The World Bank also said India made paying taxes easier by replacing many indirect taxes with a single indirect tax, the GST, for the entire country. India also made paying taxes less costly by reducing the corporate income tax rate and the employees' provident funds scheme rate paid by the employer. Stating that a well-designed insolvency framework is a vital determinant of debt recovery, it said the establishment of debt recovery tribunals in India reduced non-performing loans by 28% and lowered interest rates on larger loans, suggesting that faster processing of debt recovery cases cut the cost of credit.

The report further stated that India reduced the time and cost of export and import through various initiatives, including the implementation of electronic sealing of containers, the upgrading of port infrastructure and allowing electronic submission of supporting documents with digital signatures. World Bank said India has further streamlined the process of obtaining a building permit and made it faster and less expensive to obtain a construction permit. It also improved building quality control by introducing decennial liability and insurance.

The CNX Nifty ended at 10382.95, down by 3.65 points or 0.04% after trading in a range of 10341.90 and 10441.90. There were 27 stocks advancing against 23 stocks declining on the index. (Provisional)

The top gainers on Nifty were Yes Bank up by 8.77%, Hindalco up by 5.04%, Axis Bank up by 3.73%, UPL up by 3.23% and BPCL up by 2.87%. (Provisional)

On the flip side, HCL Tech. down by 4.38%, Tech Mahindra down by 3.11%, Dr. Reddys Lab down by 3.10%, Bharti Infratel down by 3.06% and Infosys down by 2.74% were the top losers. (Provisional)

European markets were trading mostly in green; France’s CAC increased 20.63 points or 0.4% to 5,114.07 and Germany’s DAX was up by 77.22 points or 0.67% to 11,524.73, while UK’s FTSE 100 decreased 9.35 points or 0.13% to 7,118.75.

Asian markets ended mixed on Thursday as investors reacted to the latest corporate earnings results, upbeat private-sector job growth data from the US and disappointing Chinese data. Chinese shares ended slightly higher as hints of more stimulus helped outweigh disappointing data. The assurance came as survey data from IHS Markit showed that China's manufacturing sector expanded only slightly in October. The Caixin Purchasing Managers' Index came in at 50.1 in October versus 50.0 in September, as output remained broadly unchanged amid marginal increase in new business.