Erasing steep losses, Indian equity benchmarks staged smart recovery in the late hours of trade and settled with decent gains on Wednesday, aided by buying in select bluechip counters such as Bharti Airtel, HDFC Bank and Larsen & Toubro. Key indices made a weak start, tracking a sell-off in global markets amid US government shutdown and concerns over global economic growth for next year. Investors took cautious approach on former chief economic advisor Kaushik Basu’s statement that distress in some sectors of the economy has slowed India’s GDP growth, the consequences of which could be far reaching. Basu said distress has been very much visible in the agriculture sector as the condition of farmers is bad. Sentiments also weighed down with a private report as India near 2019 general elections, populist steps by the government may exert pressure on India’s fiscal scenario. It expected the general government debt at 70.1% of the GDP in FY19.
However, in late hour of trade, markets rebounded from day's sharp losses to break a three-day losing spree and traded with full traction, as sentiments turned optimistic with Finance Minister and GST Council Chairman Arun Jaitley raising hopes of further pruning the peak rate (28%) and merging the 12% and 18% slabs. investors also cheered with data showing that investments in the Indian capital market through participatory notes climbed to Rs 79,247 crore in November after hitting a nine-and-a-half year low at the end of preceding month. Adding to the optimism, a private report said that the government is considering several measures to support farmers in distress as pressure mounts for a nationwide loan waiver scheme ahead of the general election.
On the global front, Asian markets ended mostly lower on Wednesday after President Donald Trump said that there was 'nothing new' on the partial government shutdown over a U.S.-Mexico border wall. Back home, power sector stocks ended lower amid report that fresh capacity addition in thermal and hydro power plunged 69% in the April-November period of this fiscal, as green energy gained momentum.
The BSE Sensex ended at 35684.77, up by 214.62 points or 0.61% after trading in a range of 35010.82 and 35703.80. There were 19 stocks advancing against 12 stocks declining on the index. (Provisional)
The broader indices ended mixed; the BSE Mid cap index was up by 0.02%, while Small cap index was down by 0.22%. (Provisional)
The top gaining sectoral indices on the BSE were Telecom up by 1.65%, Bankex up by 0.76%, Capital Goods up by 0.68%, Basic Materials up by 0.60% and Industrials up by 0.58%, while IT down by 0.60%, Realty down by 0.42%, Healthcare down by 0.24%, TECK down by 0.17% and Power down by 0.14% were the top losing indices on BSE. (Provisional)
The top gainers on the Sensex were Bharti Airtel up by 3.95%, HDFC Bank up by 1.78%, HDFC up by 1.75%, Larsen & Toubro up by 1.28% and Kotak Mahindra Bank up by 1.04%. (Provisional)
On the flip side, Sun Pharma down by 2.18%, Yes Bank down by 1.35%, NTPC down by 1.26%, ONGC down by 1.01% and TCS down by 0.92% were the top losers. (Provisional)
Meanwhile, expressing concerns over India’s economic growth, former chief economic advisor Kaushik Basu stated that the country’s Gross Domestic Product (GDP) growth rate has slowed down due to distress in some sectors of the economy and the consequences of which could be far reaching. He added that this has resulted in a decrease in job creation and it is a cause for concern.
Basu highlighted that distress has been ‘very much visible in the agriculture sector’ as the ‘condition of farmers is bad’. According to the latest government data, the country’s economy grew at 7.1% in July-September, the lowest in three quarters. Noting that the slowdown may continue for six months to one year and its consequences could be far reaching, he said the government needs to pay attention to the condition of people in villages.
Former chief economic advisor said the agriculture sector is still feeling the effects of demonetisation, while other sectors had factored in the note ban to a large extent. He also said ‘Many farmers who had resorted to heavy borrowings in the December 2016-January 2017 period could not tide over the situation as yet. The distress in the agri sector is very much there’. Talking about farm loan waiver, he said it was needed in India because of ‘special circumstances’.
The CNX Nifty ended at 10741.95, up by 78.45 points or 0.74% after trading in a range of 10534.55 and 10747.50. There were 36 stocks advancing against 14 stocks declining on the index. (Provisional)
The top gainers on Nifty were Zee Entertainment up by 4.27%, Adani Ports &SEZ up by 4.13%, Bharti Airtel up by 4.01%, Bajaj Finserv up by 3.04% and HDFC Bank up by 2.08%. (Provisional)
On the flip side, Sun Pharma down by 2.27%, Yes Bank down by 1.54%, TCS down by 1.38%, Infosys down by 0.79% and Cipla down by 0.75% were the top losers. (Provisional)
Asian markets ended mostly lower on Wednesday as worries about political uncertainty in the US following a partial government shutdown that now looks set to extend into the New Year, and mounting concerns about global economic growth forced investors to largely stay away from stocks once again. US President Donald Trump's highly critical comments about the Federal Reserve's rate decisions also dented investor sentiment. With a few markets in the region closed for public holiday, movements were a bit sluggish amid subdued activity. Though, Japanese shares closed higher on a wave of late buying after fluctuating throughout the session. A weaker yen contributed as well to market's rise.
Asian Indices | Last Trade | Change in Points | Change in % |
Shanghai Composite | 2,498.29 | -6.53 | -0.26 |
Hang Seng | - | - | - |
Jakarta Composite | 6,127.85 | -35.75 | -0.58 |
KLSE Composite | 1,672.60 | -11.22 | -0.67 |
Nikkei 225 | 19,327.06 | 171.32 | 0.89 |
Straits Times | 3,011.15 | -39.91 | -1.31 |
KOSPI Composite | 2,028.01 | -27.00 | -1.31 |
Taiwan Weighted | 9,478.99 | -48.10 | -0.50 |
