Post Session: Quick Review

Indian equity benchmarks ended Monday’s trade on an optimistic note, with Nifty and Sensex ending just shy of 10,950 and 36,550 marks respectively. After making a cautious start, markets gained traction and traded in fine fettle, tracking positive global cues amid developments in the US-China trade relations. Traders reacted positively to Union Commerce and Civil Aviation Minister Suresh Prabhu’s statement that India has the potential to be a $5 trillion economy in the next 7-8 years. Prabhu said his department had prepared a road map to make this possible by focusing on manufacturing, service sector and agriculture. Some optimism also spread among the local traders with central bank Governor Shaktikanta Das’ statement that the Reserve Bank of India (RBI) will make all efforts to maintain financial stability and to facilitate enabling conditions for sustainable and robust growth.

However, markets trimmed some of their initial gains in late hour of trade, as market-men got anxious with India Ratings and Research’s latest report stating that the cumulative fiscal deficit of Indian states is expected to rise following the announcement of farm support packages ahead of national elections due by May. The aggregate budget deficit of Indian states is estimated to increase to 3.2 percent of gross domestic product (GDP) in the next financial year beginning April, compared with 2.8 percent estimated for the current year. But, markets managed to close the session in green, as optimism remained among traders with a private report that India is likely to surpass the United Kingdom in the world’s largest economy rankings in 2019. The report projects real GDP growth of 1.6% for the UK, 1.7% for France and 7.6% for India in 2019. Traders also took a note of a private report stating that Indian billionaires saw their fortunes swell by Rs 2,200 crore a day last year, with the top 1 percent of the country's richest getting richer by 39 percent as against just 3 percent increase in wealth for the bottom-half of the population.

On the global front, Asian markets ended mostly higher on Monday, as investors cheered with private reports suggesting that China had offered to buy more American goods through 2024 to eliminate its trade imbalance with the US. European markets were trading mostly in red, after fresh data from China showed its economy grew at its slowest pace since 1990. Back home, coal sector stocks ended lower with a report that coal imports in India saw a surge of 6.7% to 171.81 million tonne (MT) in the April-December period of the ongoing financial year.

The BSE Sensex ended at 36540.09, up by 153.48 points or 0.42% after trading in a range of 36351.77 and 36701.03. There were 9 stocks advancing against 21 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index fell 0.67%, while Small cap index was down by 0.77%. (Provisional)

The top gaining sectoral indices on the BSE were Energy up by 2.60%, Oil & Gas up by 0.64%, IT up by 0.48%, TECK up by 0.31% and Healthcare up by 0.29%, while Auto down by 1.24%, Realty down by 1.23%, PSU down by 1.07%, Industrials down by 0.90% and Telecom down by 0.86% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Reliance Industries up by 4.34%, Kotak Mahindra Bank up by 2.72%, Sun Pharma up by 1.96%, Bajaj Finance up by 1.74% and Infosys up by 1.50%. (Provisional)

On the flip side, Hero MotoCorp down by 3.56%, Yes Bank down by 3.38%, Maruti Suzuki down by 2.07%, Bajaj Auto down by 1.63% and Power Grid down by 1.45% were the top losers. (Provisional)

Meanwhile, expressing confidence over growth of Indian economy, Union Commerce and Civil Aviation Minister Suresh Prabhu stated that India has potential to be a $5 trillion economy in the next 7-8 years. He added that the country definitely will be a $10 trillion economy before 2035.

Prabhu further said his department had prepared a road map to make this possible by focusing on manufacturing, service sector and agriculture. Manufacturing should lead to export. This will bring quality and competitiveness. He noted that the nation’s cumulative export stands at around half a trillion dollars and the challenge is to double it. He also said ‘Today, we have great opportunity to increase exports’.

The Minister highlighted that there are disruptions taking place in the world and India should take advantage of it. He said India can increase exports to Africa and Latin American countries. In order to boost air connectivity in the country, he said 100 new airports will come up in the near future with a cumulative investment of $65 billion.

The CNX Nifty ended at 10949.40, up by 42.45 points or 0.39% after trading in a range of 10885.75 and 10987.45. There were 17 stocks advancing against 33 stocks declining on the index. (Provisional)

The top gainers on Nifty were Reliance Industries up by 4.36%, Kotak Mahindra Bank up by 2.73%, Bajaj Finserv up by 2.08%, Sun Pharma up by 2.00% and Bajaj Finance up by 1.77%. (Provisional)

On the flip side, Hero MotoCorp down by 3.99%, Yes Bank down by 3.75%, Wipro down by 2.79%, Maruti Suzuki down by 2.31% and Bajaj Auto down by 1.79% were the top losers. (Provisional)

European markets were trading mostly in red; France’s CAC decreased 11.79 points or 0.24% to 4,864.14 and Germany’s DAX decreased 58.95 points or 0.53% to 11,146.59, while UK’s FTSE 100 was up by 17.68 points or 0.25% to 6,986.01.

Asian markets ended mostly higher on Monday as weak GDP data from China spurred hopes that authorities will pursue more stimulus to support growth. Investors also cheered media reports suggesting that China had offered to buy more American goods through 2024 to eliminate its trade imbalance with the US. Chinese shares rose as GDP figures came in line with expectations and reports on industrial production and retail sales topped forecasts. China's GDP grew a seasonally adjusted 1.5 percent sequentially in the fourth quarter of 2018, in line with expectations and down from 1.6 percent in the third quarter. On an annualized basis, GDP expanded 6.4 percent - again matching forecasts and down from 6.5 percent in the three months prior. Separately, industrial production climbed 5.7 percent on year in December, topping forecasts for 5.3 percent and up from 5.4 percent in November. Retail sales were up an annual 8.2 percent - topping expectations for 8.1 percent, which would have been unchanged. Further, Japanese shares eked out modest gains to hit over one-month high as a softer yen boosted exporters. Meanwhile, Malaysian markets are closed for a public holiday.