Markets end with stellar gains of over a percent

Indian equity benchmarks ended Tuesday’s trading session on jubilant note, with both Sensex and Nifty posting stellar gains of over a percent. The start of the day was cautious, impacted by the Finance Ministry’s statement that Goods and Services Tax (GST) collections in February dropped to Rs 97,247 crore from Rs 1.02 lakh crore in the previous month. The government has lowered the GST collection target for current fiscal to Rs 11.47 lakh crore in the revised estimates, from Rs 13.71 lakh crore budgeted initially. However, key indices soon gained traction, as India’s services sector gathered momentum in the month of February, with a quicker expansion in new work supporting a faster increase in output and solid job creation. As per the survey report, the seasonally adjusted Nikkei Services Business Activity Index rose to 52.5 in February from 52.2 in January. Further, the Nikkei India Composite PMI Output Index -- which measures both manufacturing and services -- also surged to 53.8 in February as against 53.6 in January.

Rally continued during the second half of the session, tracking firm European markets. The street remained positive, amid reports that the income tax e-returns filed for the April-February period has grown nearly 30% compared with the corresponding period in FY18. While almost 6.4 crore taxpayers filed returns in the first 11 months of the fiscal, the government is expecting 7.6 crore returns to be filed by the end of FY19 against 6.7 crore in FY18. Domestic sentiments were also buoyed by India’s chief economic adviser Krishnamurthy Subramanian’s statement that India’s next government will have to bring in land, labour and financial sector reforms to improve the productivity of the manufacturing sector and boost economic growth. Meanwhile, the Reserve Bank of India’s (RBI) report showed that Indian companies borrowed $2.42 billion from overseas markets in the month of January 2019 through external commercial borrowing (ECB), down by 45 percent from the year-ago period. The borrowings though ECBs were $5.40 billion in January last year.

On the global front, European markets were trading in green, as Eurozone investor confidence improved in March. The survey data from Sentix showed that the investor confidence index for the euro area improved to -2.2 in March from -3.7 in February. Besides, Germany's unemployment declined sharply in February, while retail sales rebounded strongly in January, both surpassing economists' expectations by wide margins, suggesting that the growth in the biggest euro area economy is set to be driven by private consumption as exports suffer due to global factors. As per the figures from the Federal Labor Agency, the seasonally adjusted number of unemployed fell by 21,000 in February. However, Asian markets ended in red, after China lowered its economic growth target for this year and warned of further turbulence in the global economy. China cut its GDP growth target for 2019 to 6.0 percent from 6.5 percent and warned of tough challenges from rising debt and a trade dispute with the US.

Back home, textile sector stocks ended higher after Union Textiles Minister, Smriti Zubin Irani, inaugurated the renovated Handloom Haat in New Delhi. Its main objective is to provide infrastructure support to handloom agencies to augment their sales of handloom products and to showcase the exquisite variety of handloom products produced all over the country. Stocks related to the tea industry came under pressure, with Tea Board data showing that tea production saw a decline across the country during January at 13.96 million kg as against 17.68 million kg in the corresponding period a year ago. Further, stocks related to NBFC sector remained in focus with Crisil’s report that the RBI's move to align risk weights of banks' exposure to non-banking finance companies (NBFCs) with their respective credit ratings will help banks to create a lending headroom of Rs 1.4 lakh crore.

Finally, the BSE Sensex surged 378.73 points or 1.05% to 36,442.54, while the CNX Nifty was up by 123.95 points or 1.14% to 10,987.45.

The BSE Sensex touched a high and a low of 36,457.44 and 35,926.94, respectively and there were 24 stocks advancing against 07 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index gained 2.01%, while Small cap index was up by 3.11%.

The top gaining sectoral indices on the BSE were Auto up by 3.06%, PSU up by 2.88%, Oil & Gas up by 2.75%, Basic Materials up by 2.70% and Industrials up by 2.63%, while IT down by 0.86% and TECK down by 0.67% were the only losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 7.72%, Tata Motors - DVR up by 6.43%, Hero MotoCorp up by 4.60%, Axis Bank up by 4.12% and ONGC up by 3.96%. On the flip side, Infosys down by 1.15%, Hindustan Unilever down by 0.62%, TCS down by 0.19%, Power Grid down by 0.16% and Larsen & Toubro down by 0.15% were the top losers.

Meanwhile, the Ministry of Finance is planning to set up 'Asset Monetisation cell' in the Department of Investment and Public Asset Management (DIPAM) to expedite the monetisation of non-core assets of central public sector undertakings (CPSEs), which include mainly land and building. The cell will also deal with cases related to the sale of immovable enemy property, which refers to the assets left behind by people who migrated to Pakistan or China and are no longer citizens of India. The DIPAM will appoint transaction advisors and valuers for the assets which are proposed to be sold. It would be seeking a director level officer from the personnel department to man the cell.

Niti Aayog has been tasked with drawing up a list of non-core assets of various CPSEs, both healthy and sick ones, as a first step towards finance ministry's plan to monetise such assets and unlock value to shareholders. The report of Niti Aayog will be taken up by the alternative mechanism on disinvestment, headed by Finance Minister Arun Jaitley, following which the CPSE and the respective administrative ministry will further proceed with the monetisation process.

Recently, the Union Cabinet approved laying down of institutional framework for monetisation of identified non-core assets, especially land and building, of the CPSEs under strategic disinvestment and immovable enemy property under the custody of Custodian of Enemy Property for India (CEPI). It also includes sale of non-core assets of any other CPSEs after approval of competent authority or the administrative ministry, and sale of such assets of sick or loss making CPSE.

The CNX Nifty traded in a range of 10,994.90 and 10,817.00. There were 39 stocks advancing against 11 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing Finance up by 10.01%, Eicher Motors up by 7.83%, Tata Motors up by 7.27%, HPCL up by 6.57% and BPCL up by 4.90%. On the flip side, Wipro down by 3.42%, Tech Mahindra down by 2.52%, Infosys down by 1.23%, ZEEL down by 0.81% and Cipla down by 0.71% were the top losers.

European markets were trading in green; UK’s FTSE 100 gained 16.24 points or 0.23% to 7,150.63, France’s CAC soared 4.84 points or 0.09% to 5,291.41 and Germany’s DAX was up by 18.93 points or 0.16% to 11,611.59.

Asian markets ended mostly in red on Tuesday after US construction spending unexpectedly fell in December and China cut its GDP growth target, raising fresh concerns about global growth slowdown. China lowered its economic growth target for 2019 to a range of 6.0 percent to 6.5 percent from the 2018 target of around 6.5 percent, citing challenges from rising debt and a trade dispute with the US. Meanwhile, Chinese Commerce Minister Zhong Shan has stated that trade talks with the US have been ‘extremely difficult and time-consuming’ due to the large differences between the two countries. Japanese shares ended lower, with chipmakers and machinery firms underperforming amid concerns over slowing Chinese economy. Though, Chinese shares ended higher after Premier Li Keqiang's annual work report to the National People's Congress mentioned about wide-ranging tax cuts and targeted monetary support for the economy.