Bourses gain for second day; Sensex settles around 150 points higher

Indian benchmarks gained for the second consecutive session on Thursday, with Sensex and Nifty closing above their crucial psychological levels of 35,800 and 10,750, respectively. The markets made a cautious start, affected with the National Association of Software and Services Companies’ (NASSCOM) latest survey report stating that global economic uncertainties are leading to a cautionary outlook among CEOs, but they expect digitization initiatives to continue with the same momentum. According to the report, digitization of businesses and enhanced customer experience have emerged as the top 2 spending areas in IT and BPM for 2019. Some concerns also came with reports that the Goods and Services Tax (GST) Council has deferred a decision on tax rates on real estate and lottery till February 24, and extended the deadline for businesses to file sales returns for January till February 22 for all states; and February 28 for Jammu & Kashmir.

However, in late morning deals, key indices gained momentum to end the trading session in green territory, aided by Prime Minister Narendra Modi’s statement that the Indian economy is based on sound fundamentals and will in the near future double in size to $5 trillion. Traders also took encouragement with a private report stating that India will remain the fastest growing major economy, much ahead of China, in the next decade 2019-28. Some support also come with the Finance Ministry expecting bad loan recoveries to touch Rs 1.80 lakh crore during the current fiscal with two major cases at the final stage of resolution. Adding comfort among the market participants, the Retirement fund body, Employment Provident Fund Organisation (EPFO) in its latest Net Payroll Data report showed that employment generation in the India’s formal sector almost trebled to touch a 16-month high of 7.16 lakh in December 2018 as compared to 2.37 lakh in the same month a year ago.

On the global front, European markets were trading in red, as Turkey consumer confidence eased for the third consecutive month in February. The figures from the Turkish Statistical Institute showed that the consumer confidence index declined to 57.8 in February from 58.2 in January. The reading was the lowest in three months. Asian markets ended mostly higher despite Japanese manufacturing activity contracted in February for the first time in two-and-a-half years as factories cut output amid shrinking domestic and export orders. The private business survey showed that business confidence in Japan soured for the first time in more than six years, highlighting the growing toll that the US-China trade war is inflicting on Asia's export-reliant economies and global manufacturing.

Back home, banking stocks ended in green with the government’s announcement of final recapitalisation tranche amount of Rs 48,239 crore for as many as 12 public sector banks, in a bid to take them out of Reserve Bank of India’s (RBI) prompt corrective action framework. Stocks related to metal industry also surged, after Ministry of Steel stopped classifying steel producers as integrated steel producers, primary steel producers, secondary steel producers, in order to provide a level playing field to steel manufacturers, both SMEs and large players, with different capacities and following different routes of steel production. Instead, once the steel product is certified by the Bureau of Indian Standard and meets the desired specifications, no distinction shall be made on account of the basic input material and the process followed. 53 quality control orders have been issued in this regard laying down the quality standards for several steel products.

Finally, the BSE Sensex gained 142.09 points or 0.40% to 35,898.35, while the CNX Nifty was up by 54.40 points or 0.51% to 10,789.85.

The BSE Sensex touched a high and a low of 35,983.07 and 35,707.29, respectively and there were 18 stocks advancing against 13 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 0.88%, while Small cap index was up by 1.07%.

The top gaining sectoral indices on the BSE were Basic Materials up by 1.29%, Metal up by 1.14%, Consumer Durables up by 1.02%, Healthcare up by 0.96% and Industrials up by 0.88%, while IT down by 0.32% and TECK down by 0.21% were the only losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 2.94%, Vedanta up by 2.78%, Tata Motors - DVR up by 2.74%, ONGC up by 2.05% and Bajaj Finance up by 2.01%. On the flip side, Yes Bank down by 1.33%, Infosys down by 0.91%, Maruti Suzuki down by 0.76%, Coal India down by 0.74% and Indusind Bank down by 0.62% were the top losers.

Meanwhile, the Commerce and industry ministry in its latest data has showed that in the first nine months (April-December) of current financial year (FY19) Foreign direct investment (FDI) into India contracted by 7% to $33.49 billion as compared to $35.94 billion in same period of last financial year (FY18). A decline in FDI inflows could put pressure on the country's balance of payments and may also impact the value of the rupee.

The key sectors that received the maximum FDI during April-December period of FY19 include services ($5.91 billion), computer software and hardware ($4.75 billion), telecommunications ($2.29 billion), trading ($2.33 billion), chemicals ($6.05 billion), and the automobile industry ($1.81 billion).

Singapore was the largest source of FDI during April-December 2018-19 with $12.97 billion inflow, followed by Mauritius ($6 billion), the Netherlands ($2.95 billion), Japan ($2.21 billion), US ($2.34 billion), and the UK ($1.05 billion). 

The CNX Nifty traded in a range of 10,808.85 and 10,721.50. There were 36 stocks advancing against 14 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing Finance up by 6.32%, Bajaj Finserv up by 3.21%, Tata Motors up by 3.16%, Dr. Reddy’s Lab up by 3.12% and Vedanta up by 2.59%. On the flip side, Bharti Infratel down by 1.87%, Yes Bank down by 1.08%, Infosys down by 0.90%, NTPC down by 0.58% and Coal India down by 0.54% were the top losers.

European markets were trading mostly in red; UK’s FTSE 100 fell 47.73 points or 0.66% to 7,180.89 and France’s CAC dropped 4.16 points or 0.08% to 5,191.79, while Germany’s DAX was up by 23.41 points or 0.21% to 11,425.38.

Asian markets ended mostly higher on Thursday following a report that the United States and China were outlining agreements on the stickiest trade issues. Dovish signals from the US Federal Reserve also lent some support. Japanese shares ended higher as optimism over US-China trade talks helped investors shrug off weak manufacturing data. Japan's manufacturing sector slipped into contraction in February, the latest survey from Nikkei revealed with a 32-month low manufacturing PMI score of 48.5. That's down from 50.3 in January. Meanwhile, Chinese shares ended modestly lower after a spokesman for China's Ministry of Foreign Affairs said the country would not use the yuan's exchange rate as a bargaining chip to deal with trade dispute. Investors also bet that Beijing will not resort to aggressive interest rate cuts to spur the slowing economy, despite stronger yuan and cooling inflation.