Benchmarks trade in fine fettle in early deals

Indian equity benchmarks made an optimistic start and are trading in fine fettle in early deals on Friday ahead of Gross Domestic Product (GDP) data for the September quarter due later in the day for clues on the strength of domestic economy. Sentiments remained upbeat with economic policy think-tank the National Council of Applied Economic Research’s (NCAER) report stating that Indian economy is projected to grow at 7-7.4 per cent in the current fiscal. It added that the real agriculture Gross Value Added (GVA) is envisaged to grow at 3 per cent and real industry GVA at 7 per cent in 2018-19. As per the report, the forecast for Gross Value Added (GVA) at basic prices is 7.0-7.4 per cent. These forecasts at constant (2011-12) prices are based on NCAER's annual GDP macro model. Some support also came with report that the Reserve Bank of India (RBI) on November 29 relaxed rules for non-banking financial companies (NBFCs) to sell or securitise their loan books, in a bid to ease persistent stress in the sector.

On the global front, Asian markets are trading mostly in green at this point of time ahead of crucial meeting between the US and Chinese presidents with the course of the trade war at stake. The US markets ended lower on Thursday as participants weighed up the outlook for Federal Reserve policy and looked nervously towards the forthcoming G20 summit in Argentina.

Back home, banking stocks remained in focus with the RBI’s statement that Net Stable Funding Ratio (NSFR) norms that mandate banks to maintain a stable funding profile in relation to the composition of their assets and off-balance sheet activities will be operational from April 2020. The NSFR is defined as the amount of available stable funding relative to the amount of required stable funding. In scrip specific developments, TCS gained on launching ‘TCS Pace’ to take research, innovation offerings to Next Level and  Indiabulls Housing Finance surged on raising Rs 200 crore via NCDs.

The BSE Sensex is currently trading at 36310.04, up by 139.63 points or 0.39% after trading in a range of 36250.36 and 36389.22. There were 18 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.43%, while Small cap index was up by 0.49%.

The top gaining sectoral indices on the BSE were Realty up by 1.85%, Healthcare up by 1.18%, IT up by 0.99%, TECK up by 0.88% and Consumer Disc was up by 0.83%, while Metal down by 0.83%, Telecom down by 0.35%, Power down by 0.32%, Industrials down by 0.11% and Basic Materials down by 0.07% were the top losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 5.95%, Wipro up by 2.37%, Mahindra & Mahindra up by 2.25%, Maruti Suzuki up by 1.44% and Bharti Airtel up by 1.15%. On the flip side, Tata Motors down by 2.09%, Tata Motors - DVR down by 1.98%, Vedanta down by 1.78%, Adani Ports down by 1.26% and NTPC down by 1.16% were the top losers.

Meanwhile, expressing optimism over India’s growth, economic policy think-tank, the National Council of Applied Economic Research (NCAER) in its Mid-Year Review of the Economy projected that Indian economy is likely to grow at 7-7.4% in the current fiscal (FY19). It added that the real agriculture Gross Value Added (GVA) is envisaged to grow at 3% and real industry GVA at 7% in 2018-19. Besides, GVA forecast at basic prices is 7.0-7.4% and these forecasts at constant (2011-12) prices are based on NCAER's annual GDP macro model.

As per the report, Gross Domestic Product (GDP) growth rate at market prices estimated at 7.4-7.7% for 2018-19. The growth rates of exports and imports, in dollar terms, are estimated at 11.8% and 16.9%, respectively. The current account balance and central fiscal deficit, as percentages of GDP, are projected at (-) 2.3% and 3.2%, respectively. The economic policy think-tank said that based on its estimates, the combined output of kharif and rabi foodgrains during the current year may be in the region of 290 million tonnes, which is slightly higher than last year's record output. It also said the outlook for the Indian industrial sector remains mixed for current fiscal.

On the inflation front, it said almost all inflation metrics exhibited a decreasing trend after showing an uptick in the last quarter. This was largely due to the deflationary trend exhibited in food prices. It added that inflation is expected to fall further in the next quarter due to moderating fuel prices. The NCAER also pointed out that the softening of headline CPI inflation in October 2018 and slump in global crude oil prices along with the pullback of the rupee in November 2018, reduce the chance of a rate hike at the RBI's bimonthly monetary policy meeting to be held on December 5, 2018.

The CNX Nifty is currently trading at 10901.35, up by 42.65 points or 0.39% after trading in a range of 10882.45 and 10922.45. There were 30 stocks advancing against 19 stocks declining on the index, while 1 stock remained unchanged.

The top gainers on Nifty were Yes Bank up by 6.14%, Mahindra & Mahindra up by 2.42%, Wipro up by 2.18%, Zee Entertainment up by 2.18% and Cipla up by 1.57%. On the flip side, Bharti Infratel down by 2.43%, Tata Motors down by 2.14%, Vedanta down by 1.63%, NTPC down by 1.51% and UPL down by 1.46% were the top losers.

Asian markets are trading mostly in green; Nikkei 225 gained 77.51 points or 0.35% to 22,340.11, Taiwan Weighted rose 50.11 points or 0.5% to 9,935.47, Straits Times jumped 16.59 points or 0.53% to 3,126.03, Hang Seng surged 182.85 points or 0.69% to 26,633.88 and Shanghai Composite was up by 5.97 points or 0.23% to 2,573.41. On the flip side, Jakarta Composite decreased 24.33 points or 0.4% to 6,082.84 and KOSPI was down by 4.50 points or 0.21% to 2,109.60.