Post Session: Quick Review

Indian equity benchmarks recovered from day’s low points, but failed to erase all losses and ended in red terrain, tracking weakness in Asian peers. It was a negative start to the markets, as traders remained pessimistic about a report that the flow of foreign direct investment (FDI) into India is dropping and may suffer its first full-year decline since Prime Minister Narendra Modi came to power in 2014. Inbound FDI dropped 7% to $33.5 billion in the nine months between April and December 2018, compared with $36 billion in the year-earlier period. Markets extended their fall and traded near intraday low levels in morning deals, as sentiment on the street weakened further with Bibek Debroy, the head of Prime Minister’s economic advisory panel, stating that India lacks good data on economy and jobs as it is majorly an informal economy.

However, key indices gave up major losses in afternoon session and came off their intraday low points, due to some buying witnessed in Auto and Oil & Gas stocks. Traders also found some support with SBI Research’s report saying that the economy is likely to grow at 6.6-6.7% in the third quarter and 7.2% for the full financial year. The yearly SBI composite index for February saw a marginally rise to 50.60 (a score of under 50 indicates negative growth). But, the trade remained in negative terrain, as some anxiety remained among the investors with domestic ratings agency Icra’s report that India Inc witnessed a dip in both revenue growth as well as margins in the December quarter compared to the preceding three months. The analysis is based on the aggregate numbers reported by 648 listed companies, which shows a revenue growth of 17.3% in Q3 down from 19.4% in the preceding three months.

On the global front, Asian markets ended mostly in red on Tuesday, while European markets were trading in red as optimism on United States-China trade talks faded and caution set in ahead of the second summit between US President Donald Trump and North Korean leader Kim Jong Un. Back home, reality sector stocks ended lower with CRISIL Research’s report that even as the latest GST cut on under-construction housing projects is expected to increase demand, real estate developers may see mixed results. It added that the withdrawal of input tax credit (ITC) would impact the profitability of developers.

The BSE Sensex ended at 35973.17, down by 240.21 points or 0.66% after trading in a range of 35714.16 and 36172.52. There were 10 stocks advancing against 21 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index fell 0.21%, while Small cap index was down by 0.50%. (Provisional)

The top gaining sectoral indices on the BSE were Auto up by 0.28%, Oil & Gas up by 0.19%, Metal up by 0.13%, Telecom up by 0.02% and Utilities up by 0.02%, while Realty down by 1.64%, Bankex down by 0.72%, Capital Goods down by 0.66%, Energy down by 0.46% and FMCG down by 0.39% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Tata Motors up by 4.04%, Coal India up by 3.10%, TCS up by 2.12%, Tata Motors - DVR up by 1.06% and Axis Bank up by 0.97%. (Provisional)

On the flip side, HCL Tech. down by 2.34%, HDFC down by 2.16%, ICICI Bank down by 1.97%, Infosys down by 1.81% and SBI down by 1.42% were the top losers. (Provisional)

Meanwhile, ahead of the Central Statistics Office’s (CSO) Gross Domestic Product (GDP) data release, the State Bank of India (SBI) Research in its latest report has said that Indian economy is likely to grow in the range of 6.6-6.7 percent during the third quarter of the current fiscal year 2018-19 (FY19). It added that for the full financial year, the growth will be 7.2 percent. Besides, the report said that the CSO has recently revised GDP growth for FY18 from 6.7 percent earlier to 7.2 percent. At this rate, FY19 growth rate would have been at 5.9 percent (earlier 7.2 percent).

The yearly SBI composite index for February saw a marginally rise to 50.60 (a score of under 50 indicates negative growth). The index remained volatile and declined to 11-month low of 46.10 (low decline) in February from 52.8 (moderate growth) in January. SBI Research said based on the annual performance of these leading indicators, they are expecting GDP to grow around 6.6-6.7 percent in the December quarter.

However, SBI Research believes the GDP deflator which is at 4.1 percent now, could be revised downwards by at least 50 bps, thus pushing GDP close to 7.2 percent in FY19. With the decline in index, the report said that Index of Industrial Production (IIP) manufacturing may grow at 1.5 percent and overall IIP at 2.5 percent in February. On the Goods and Services Tax (GST) front, it expects total GST collection for February to be at Rs 95,500 crore, significantly lower than Rs 1.05 lakh crore in the previous month.

The CNX Nifty ended at 10832.45, down by 47.65 points or 0.44% after trading in a range of 10729.30 and 10888.75. There were 23 stocks advancing against 27 stocks declining on the index. (Provisional)

The top gainers on Nifty were Zee Entertainment up by 6.04%, Tata Motors up by 3.90%, Coal India up by 2.96%, Indian Oil Corp. up by 2.74% and TCS up by 2.36%. (Provisional)

On the flip side, Indiabulls Housing Finance down by 2.89%, HCL Tech. down by 2.25%, HDFC down by 2.03%, ICICI Bank down by 1.95% and Infosys down by 1.74% were the top losers. (Provisional)

European markets were trading in red; UK’s FTSE 100 decreased 73.45 points or 1.02% to 7,110.29, France’s CAC dropped 24.53 points or 0.47% to 5,207.32 and Germany’s DAX declined 34.29 points or 0.3% to 11,471.10.

Asian markets ended mostly in red on Tuesday as optimism on United States-China trade talks faded and caution set in ahead of the second summit between US President Donald Trump and North Korean leader Kim Jong Un. Investors also awaited Federal Reserve Chairman Jerome Powell's testimony before Congress for fresh clues about the outlook for US interest rates. Japanese shares ended lower amid selling pressure owing to window-dressing towards the end of the fiscal year. Further, Chinese shares fell on profit taking after strong gains in the previous session.