Post Session: Quick Review

Indian stock markets traded firmly in green on Friday and ended with gains of over half a percent, on the back of buying by participants amid signs of easing Indo-Pak tensions. With that, the markets halted their three-day decline, with Sensex and Nifty closing above their crucial 36,050 and 10,850 levels, respectively. The day began on strong note, as traders got encouragement with the World Bank’s report that increasing exports can lead to better jobs and higher wages in India, including more formal sector employment for youth and women. Some comfort also came after Finance Minister Arun Jaitley expressed hopes that the remaining six public sector banks (PSBs) under the Reserve Bank of India’s (RBI) prompt corrective action (PCA) framework will soon come out of it with the government commitment of support to them.

Domestic indices extended their upside in last hour of trade and were trading near intraday high points, as sentiment on the street improved further with a report that manufacturing activity in India improved at a 14-month high in February, accelerated by an increase in sales which fuelled growth of output and employment. The Nikkei India Manufacturing Purchasing Managers’ Index (PMI) rose to 54.3 in February, up from 53.9 in January. Sentiment was also upbeat with Moody's report stating that the Indian economy is expected to grow at 7.3 per cent in calendar year 2019 and 2020, and the government spending announced ahead of elections this year will support near-term growth.

The street overlooked the Central Statistics Office’s (CSO) data stating that India’s economic growth slowed to a 5-quarter low of 6.6% in October-December period of this fiscal on the back of lower farm and manufacturing growth and weaker consumer demand. The Gross Domestic Product (GDP) at constant prices (2011-12) had grown at 7 per cent in October-December quarter of the previous financial year. Investors even shrugged off Labour Ministry’s statement that retail inflation for industrial workers rose to 6.6 percent in Janurary 2019 on account of higher prices of certain food items.

On the global front, Asian markets ended mostly in green on Friday, while European markets were trading in green, after a report showed the U.S. economy grew faster than expected at the end of 2018, helping ease investor worries surrounding slowing global growth. Back home, textile sector were in limelight after the Union Minister Smriti Irani launched a scheme for development of knitting and knitwear sector under PowerTex India, which will be in operation up to March 31, 2020. The two primary components of the scheme are creation of new service centres and modernisation and upgradation of existing service centres.

The BSE Sensex ended at 36062.23, up by 194.79 points or 0.54% after trading in a range of 35952.41 and 36140.67. There were 25 stocks advancing against 6 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index rose 1.24%, while Small cap index was up by 2.13%. (Provisional)

The top gaining sectoral indices on the BSE were PSU up by 1.89%, Basic Materials up by 1.66%, Industrials up by 1.59%, Metal up by 1.59% and Capital Goods up by 1.37%, while Telecom down by 1.24% and Realty down by 0.36% were the only losing indices on BSE. (Provisional)

The top gainers on the Sensex were Indusind Bank up by 3.16%, Tata Motors - DVR up by 3.14%, Yes Bank up by 2.42%, Vedanta up by 2.13% and Coal India up by 1.90%. (Provisional)

On the flip side, Bharti Airtel down by 3.15%, Bajaj Auto down by 1.31%, Axis Bank down by 0.95%, Asian Paints down by 0.86% and Reliance Industries down by 0.57% were the top losers. (Provisional)

Meanwhile, Finance Minister Arun Jaitley stated that the Union Cabinet has cleared a Rs 10,000-crore programme under the FAME-II scheme for promoting electric and hybrid vehicles. The scheme will be implemented over a period of three years with effect from April 1, 2019. The objective of the scheme is to encourage faster adoption of electric and hybrid vehicles by way of offering upfront incentive on purchase of electric vehicles and also by way of establishing necessary charging infrastructure for EV. It is the expanded version of the present scheme FAME India I (Faster Adoption and Manufacturing of (Hybrid) and Electric Vehicles) which was launched on April 1, 2015, with a total outlay of Rs 895 crore.

The emphasis will be on electrification of public transport that includes shared transport, demand incentives on operational expenditure mode for electric buses will be delivered through state/city transport corporations (STUs).  In three-wheeler and four wheeler segments, incentives will be applicable mainly on vehicles used for public transport or registered commercial purposes. In the two-wheeler segment, the focus will be on private vehicles. The scheme is planned to support 10 lakh electric two-wheelers, 5 lakh three-wheelers, 55,000 four-wheelers and 7,000 buses. The scheme will help in addressing the issue of environmental pollution and fuel security.

Besides, in order to encourage advance technologies, the benefits of the incentives will be extended to only those vehicles which are fitted with advanced battery like lithium-ion battery and other new technology batteries. The scheme also proposes support for setting up of charging infrastructure whereby about 2,700 charging stations will be set up in metros, other million-plus cities, smart cities and cities of hilly states across India.

The CNX Nifty ended at 10861.30, up by 68.80 points or 0.64% after trading in a range of 10823.10 and 10877.90. There were 39 stocks advancing against 11 stocks declining on the index. (Provisional)

The top gainers on Nifty were HPCL up by 4.54%, Zee Entertainment up by 4.33%, Indian Oil Corp. up by 2.90%, Indusind Bank up by 2.80% and Yes Bank up by 2.70%. (Provisional)

On the flip side, Bharti Airtel down by 3.25%, Bajaj Auto down by 1.35%, Axis Bank down by 1.11%, UPL down by 0.95% and Asian Paints down by 0.87% were the top losers. (Provisional)

European markets were trading in green; UK’s FTSE 100 increased 46.28 points or 0.65% to 7,121.01, France’s CAC soared 41.37 points or 0.79% to 5,281.90 and Germany’s DAX gained 129.79 points or 1.13% to 11,645.43.

Asian markets ended mostly in green on Friday after fourth-quarter US GDP data topped expectations and White House economic advisor Larry Kudlow said the US and China are making ‘fantastic’ progress in their trade negotiations. Chinese shares ended higher after global index provider MSCI said it would quadruple the weighting of Chinese mainland shares in its global benchmarks later this year. Further, Japanese shares rose sharply to hit 2-1/2-month highs on futures buying as a weaker yen boosted exporters. Meanwhile, the South Korea markets were closed for the Independence Movement Day holiday. Taiwan’s stock market remains shut for the Peace Memorial Day holidays.