Post Session: Quick Review

Extending their gaining streak for second straight session, Indian equity benchmarks ended Friday’s trade on an optimistic note, with gains of over half a percent, driven by consumption and auto stocks as investors welcomed individual tax exemptions and sops in the farm sector announced in the interim Budget. Domestic bourses made a positive start, as traders took encouragement with the finance ministry’s statement that revenue collection from Goods and Services Tax (GST) witnessed a substantial jump, crossing Rs 1 lakh crore in January from Rs 94,726 crore in December. It said this increase has been achieved despite various tax relief measures implemented by the GST Council to lower the tax burden on the consumers. Market participants got some comfort with Central Statistics Office (CSO) reported that the GDP growth was 7.4 per cent in 2014-15 and 8 per cent in 2015-16. The CSO has estimated the Indian economy to expand at the rate of 8.2 per cent in the fiscal ending March 2019.

Domestic indices extended their upside in afternoon trade and were trading at intraday high points, as sentiment on the street improved further after Indian manufacturing sector surged in the month of January, with the quickest increase in order books. As per the survey report, the Nikkei India Manufacturing Purchasing Managers’ Index (PMI) - a composite single-figure indicator of manufacturing performance - rose to 53.9 in January from 53.2 in December. The manufacturing sector activity expanded for the 18th consecutive month as the PMI reading stood above the watershed 50 mark, which differentiates growth from contraction. 

However, key indices gave up most of their strong gains in last leg of trade to come off their intraday high points, as market-men got anxious as the government overshot the fiscal deficit target for the current financial year and announced some populist measures, which will increase fiscal burden on the exchequer.  Traders also took a note with Former finance minister P Chidambaram raising doubts over the GDP figures, wondering how the economy is growing at 7 percent when the unemployment rate was the highest in 45 years. Taking a dig at the Centre, he claimed that when the government revised the GDP figures it did not realise that the unemployment figures also got revised.

On the global front, Asian markets ended mixed on Friday, as a private survey showing that Chinese manufacturing slowed to the lowest level in almost three years. European markets were trading mostly in green, as market participants monitored a flurry of corporate results and key economic reports. Back home, Shares of telecommunication ended higher as Finance Minister Piyush Goyal announced that the monthly consumption of mobile data has increased by over 50 times in the last five years. The cost of data and voice calls in India is now possibly the lowest in the world. Besides, Shares of companies related to railway business soared after Finance Minister Piyush Goyal announced that government has allocated Rs 64589 crore for Railways in FY20.

The BSE Sensex ended at 36463.67, up by 206.98 points or 0.57% after trading in a range of 36221.32 and 36778.14. There were 23 stocks advancing against 8 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index rose 0.56%, while Small cap index was up by 0.14%. (Provisional)

The top gaining sectoral indices on the BSE were Auto up by 2.71%, Consumer Disc up by 1.81%, Realty up by 1.17%, IT up by 1.13% and FMCG up by 1.08%, while Metal down by 3.96%, Basic Materials down by 1.85%, Bankex down by 1.10% and PSU down by 0.94% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Hero MotoCorp up by 7.74%, Maruti Suzuki up by 5.08%, HCL Tech. up by 3.38%, Asian Paints up by 3.18% and Bajaj Finance up by 2.13%. (Provisional)

On the flip side, Vedanta down by 17.75%, Yes Bank down by 4.48%, SBI down by 3.12%, ICICI Bank down by 2.75% and Coal India down by 1.00% were the top losers. (Provisional)

Meanwhile, the government has revised India’s gross domestic product (GDP) growth rate upwards by 50 basis points to 7.2 per cent from 6.7 per cent for fiscal 2017-18 and by 110 basis points to 8.2 per cent from 7.1 per cent for 2016-17. As per the Central Statistics Office (CSO) data, real GDP or GDP at constant (2011-12) prices for 2017-18 and 2016-17 stand at Rs 131.80 lakh crore and Rs 122.98 lakh crore, respectively, showing growth of 7.2 per cent during 2017-18 and 8.2 per cent during 2016-17. Earlier, the CSO in its advance estimate had pegged the GDP growth rate for 2018-19 at 7.2 per cent.

The CSO said the First Revised Estimates for 2017-18 have been compiled using industry-wise/institution-wise detailed information instead of using the benchmark-indicator method employed at the time of release of Provisional Estimates on May 31, 2018. The CSO has also released the Second Revised Estimates of National Income, Consumption Expenditure, Saving and Capital Formation for 2016-17.

During 2017-18, the growth rates of primary (comprising agriculture, forestry, fishing and mining and quarrying), secondary (comprising manufacturing, electricity, gas, water supply and other utility services, and construction) and tertiary (services) sectors have been estimated as 5 per cent, 6 per cent and 8.1 per cent as against a growth of 6.8 per cent, 7.5 per cent and 8.4 per cent, respectively, in the previous year.

The CNX Nifty ended at 10891.60, up by 60.65 points or 0.56% after trading in a range of 10813.45 and 10983.45. There were 35 stocks advancing against 15 stocks declining on the index. (Provisional)

The top gainers on Nifty were Hero MotoCorp up by 7.65%, Maruti Suzuki up by 4.65%, Eicher Motors up by 3.52%, HCL Tech. up by 3.46% and Dr. Reddys Lab up by 3.27%. (Provisional)

On the flip side, Vedanta down by 18.42%, Zee Entertainment down by 7.42%, Yes Bank down by 4.64%, SBI down by 3.59% and ICICI Bank down by 2.95% were the top losers. (Provisional)

European markets were trading mostly in green; UK’s FTSE 100 increased 32.75 points or 0.47% to 7,001.60 and France’s CAC was up by 0.80 points or 0.02% to 4,993.52, while Germany’s DAX was down by 2.90 points or 0.03% to 11,170.20.

Asian markets ended mixed on Friday as weak manufacturing data from China as well as lingering trade tensions offset upbeat corporate earnings results from the US. The two-day US-China trade talks ended without anything concrete results, though US President Donald Trump said the trade dispute would hopefully be resolved before the March 1 deadline. Investors also awaited cues from the latest US jobs report due later in the day. Street expects employment to rise by 165,000 jobs in January after an addition of 312,000 jobs in December. The jobless rate is expected to hold at 3.9 percent. Japanese shares ended marginally higher as investors digested mixed economic readings. While Japan's manufacturing activity grew at its slowest pace in 29 months in January, the jobless rate unexpectedly fell to 2.4 percent in December from 2.5 percent the month before. Chinese shares ended higher even as weak data reinforced investor concerns of a slowdown in the world's second-largest economy.  A private survey showed that China's factory activity continued to weaken last month, providing the latest evidence of a prolonged economic slowdown. The Caixin/Markit PMI dropped to 48.3 in January from 49.7 in the previous month. Meanwhile, markets in Malaysia and Taiwan were closed for Federal Territory Day and the Lunar New Year holidays, respectively.