Post Session: Quick Review

Tuesday’s session turned out to be a choppy day of trade for Indian equity markets with frontline gauges ending the session with small gains, ahead of a three-day RBI monetary policy review meet, set to start later in the day. Key indices made a cautious start and traded slightly in red, as traders remained cautious with the government data showing that fiscal deficit touched 112.4% of the full-year budget target of Rs 6.24 lakh crore at the end of December on account of lower revenue collections. The fiscal deficit, or gap between Government's expenditure and revenue, stood at Rs 7.01 lakh crore during April-December of the current financial year which ends in March. Sentiment remained bearish as the Nikkei/IHS Markit Services Purchasing Managers' Index declined to a three-month low of 52.2 in January from 53.2 in December, but remained above the 50 mark separating growth from contraction for an eighth month.

However, benchmarks erased early losses and inched up in afternoon trade, as traders found some solace with Union Commerce Secretary Anup Wadhawan’s statement the country's exports in the current fiscal year are expected to surpass the earlier peak of $314 billion in 2013-14. Some comfort also came after S&P Global Ratings said that falling inflation and declining global crude oil prices have created space for the Reserve Bank of India (RBI) to cut interest rates. The RBI is scheduled to announce its sixth bi-monthly policy review for the fiscal on February 7. But, indices gave up most of their gains in dying hour of trade as anxiety remained among the local traders with Moody's Investors Service’s statement that fiscal slippage from the budgeted targets for the past two consecutive years and tax cuts and spending ahead of the general elections, is credit negative for India.

On the global front, Japanese market, the only major Asian market trading today ended in red , after a Bank of Japan (BoJ) official said the yen could jump to 95 per US dollar in the first half of the year and the central bank is running short on ammunition. European markets were trading in green, as market participants monitored a flurry of corporate earnings results. Back home, the BSE Sensex ended at 36607.07, up by 24.33 points or 0.07% after trading in a range of 36495.83 and 36727.83. There were 17 stocks advancing against 14 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index fell 0.53%, while Small cap index was down by 0.91%. (Provisional)

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.33%, Auto up by 0.94%, Consumer Discretionary Goods & Services up by 0.62%, Bankex up by 0.24% and TECK up by 0.06%, while Realty down by 2.28%, Capital Goods down by 1.08%, Power down by 1.00%, PSU down by 1.00% and Industrials down by 0.95% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Hero MotoCorp up by 3.04%, Bajaj Auto up by 2.72%, Indusind Bank up by 2.45%, Maruti Suzuki up by 1.92% and Vedanta up by 1.39%. (Provisional)

On the flip side, ONGC down by 2.80%, Coal India down by 2.70%, Yes Bank down by 2.61%, Tata Motors down by 2.47% and Tata Motors - DVR down by 2.26% were the top losers. (Provisional)

Meanwhile, rising concerns over state of financial position of the country, fiscal deficit or gap between Government's expenditure and revenue exceeded to Rs 7.01 lakh crore during April-December of the current financial year (FY19) and touched 112.4% of the full-year Budget Estimate (BE) of Rs 6.24 lakh crore on the back of lower revenue collections. Besides, at the end of December 2017, the deficit was 113.6% of the BE.

The Controller General of Accounts (CGA) data showed that the revenue receipts of the government totalled Rs 10.84 lakh crore or 62.8% of BE in 2018-19 till December, compared with 66.9% during the same period last year. The government has budgeted revenue mop up of Rs 17.25 lakh crore in FY19. The figure has been revised upwards to over Rs 17.29 lakh crore in the Interim Budget 2019-20.

Besides, tax revenue was 63.2% of BE, compared with 73.4% in the comparable period of the previous year. The total expenditure of the government at December-end was Rs 18.32 lakh crore or 75% of BE. The total expenditure for current fiscal has been raised to Rs 24.57 lakh crore in the Revised Estimates, from the budgeted Rs 24.42 lakh crore.

The government has budgeted to cut the fiscal deficit to 3.3% of GDP or Rs 6.24 lakh crore in 2018-19, from 3.53% in the previous financial year. In the interim budget for 2019-20, the fiscal deficit was revised upwards marginally to 3.4% of GDP or over Rs 6.34 lakh crore, on account of additional outlay of Rs 20,000 crore for funding income scheme for small farmers.

The CNX Nifty ended at 10935.65, up by 23.40 points or 0.21% after trading in a range of 10886.70 and 10956.70. There were 30 stocks advancing against 19 stocks declining on the index. (Provisional)

The top gainers on Nifty were Zee Entertainment up by 4.86%, Titan Co up by 4.13%, UPL up by 3.76%, Hero MotoCorp up by 3.05% and Dr. Reddys Lab up by 2.95%. (Provisional)

On the flip side, Coal India down by 2.70%, Tata Steel down by 2.38%, Tata Motors down by 2.36%, Yes Bank down by 2.22% and ONGC down by 2.05% were the top losers. (Provisional)

European markets were trading in green; UK’s FTSE 100 increased 1.12 points or 7034.13% to 78.80, France’s CAC increased 0.78 points or 5009.83% to 39.17 and Germany’s DAX increased 0.88 points or 11178.75% to 98.09.

The only major Asian market trading today ‘Japanese stock exchange’ ended in red on Tuesday, after a Bank of Japan (BoJ) official said the yen could jump to 95 per US dollar in the first half of the year and the central bank is running short on ammunition. However, the downside remained limited after a survey showed the services sector in Japan expanded at a stronger pace in December. Most of the regional markets were closed for the Lunar New Year, including South Korea, Malaysia, Singapore, Taiwan, China, Hong Kong and Indonesia.