Markets end March F&O expiry on optimistic note

Indian equity benchmarks ended Thursday’s trading session over a percent higher ahead of March F&O expiry, with Sensex and Nifty reclaiming their crucial psychological levels of 38,500 and 11,550, respectively. The markets made a positive start to trade firmly throughout the session, buoyed by the India Meteorological Department director general, K.J. Ramesh’s statement that India's monsoon is likely to be a robust and healthy one this year provided there is not a surprise El Nino phenomenon. Adding some optimism, the Global Food Policy Report said that India has taken various measures to bolster the rural economy but the efficacy of the schemes would depend upon their implementation. The report further said the prospects for rural development are encouraging in the current year and hoped that the general elections will increase attention to rural areas where the majority of voters live. Some comfort also came with a private report stating that bullish positions in the Indian rupee firmed over the past two weeks, ahead of general election, while long positions in the yuan unwound on concerns over slowing domestic demand and uncertainty around Sino-US trade talks.

In the second half of the session, key indices gained the momentum to settle near their day’s high points. Traders took encouragement with a report that private equity (PE) and venture capital (VC) investments in the country stood at $20.5 billion across 786 transactions in 2018 on account of tech-enabled start-ups, e-commerce and information technology-enabled services. The funding in 2018 was the same as the investment in the preceding year. Domestic sentiments also got boost with a report that the Reserve Bank of India (RBI) is likely to cut repo rate by 25 basis points in the April policy due to weak economic activity. The monetary policy committee is scheduled to meet from April 2 to 4. Market participants paid no heed towards with finance ministry’s statement that currency in circulation as percentage of GDP declined by over 1 percentage points to 10.48 per cent in the two years after demonetization. Investors also shrugged off report that there is a shortfall in income tax collections. Progress in tax collection has been reviewed as against the targeted Rs 12 lakh crore. Only 85.1% of the targeted or Rs 10.21 lakh crore has been collected as of March 23.

On the global front, European markets were trading in green, as Estonia's industrial production growth improved in February, after slowing in the previous two months. The figures from Statistics Estonia showed that industrial production climbed a working-day adjusted 4.4 percent year-on-year in February, following a 4.1 percent rise in January. In December, the production grew 5.5 percent. Asian markets ended mostly lower, with US recession concerns, Brexit-related uncertainty, and caution ahead of fresh US-China trade talks likely to keep investors nervous.

Back home, banking stocks ended higher, after the RBI in its latest report showed that bank credit growth increased by 14.46 percent to Rs 95.53 trillion, while deposits grew in double-digits at 10.03 percent to Rs 122.26 trillion for the fortnight ending March 15. In the year-ago fortnight, advances stood at Rs 83.46 trillion and deposits at Rs 111.11 trillion. Further, stocks related to hotel industry remained in focus with credit rating agency, ICRA's latest report stating that the domestic hotel industry is expected to register a top line growth of 10-11% in 2019 than the earlier expectation of 8.5%.

Finally, the BSE Sensex rose 412.84 points or 1.08% to 38,545.72, while the CNX Nifty was up by 124.95 points or 1.09% to 11,570.00.

The BSE Sensex touched a high and a low of 38,593.65 and 38,148.44, respectively and there were 23 stocks advancing against 07 stocks declining, while 1 stock remain unchanged on the index.

The broader indices ended in green; the BSE Mid cap index gained 1.06%, while Small cap index was up by 0.95%.

The top gaining sectoral indices on the BSE were Realty up by 1.61%, TECK up by 1.56%, IT up by 1.45%, Bankex up by 1.43% and Telecom up by 1.32%, while Metal down by 0.35% and Power down by 0.18% were the only losing indices on BSE.

The top gainers on the Sensex were HCL Tech. up by 3.84%, SBI up by 3.36%, Yes Bank up by 2.71%, Axis Bank up by 2.64% and Sun Pharma up by 2.49%. On the flip side, Tata Steel down by 1.73%, ONGC down by 1.65%, Bajaj Auto down by 1.53%, Power Grid down by 1.20% and NTPC down by 0.80% were the top losers.

The top gainers on the Sensex were Yes Bank up by 5.62%, Indusind Bank up by 5.27%, SBI up by 1.57%, Bajaj Auto up by 1.18% and Vedanta up by 1.12%. On the flip side, NTPC down by 2.25%, Tata Motors down by 1.85%, Bharti Airtel down by 1.49%, Power Grid down by 1.36% and HDFC down by 1.30% were the top losers.

Meanwhile, in order increase exports to China, the commerce ministry is going to discuss ways with various industry bodies including export promotion councils and other government departments. The ministry has called a meeting on April 5. The Officials from the agriculture ministry, Agricultural & Processed Food Products Export Development Authority, and representatives from export promotion councils would participate in the meeting.

India is taking several steps to promote shipments to China. Recently, it has managed to export agricultural goods such as non-basmati rice to China. Besides, the country is also seeking greater market access for various agricultural products, animal feeds, oil seeds, milk and milk products, pharmaceuticals in light of the potential of these products/services in the Chinese market.

Meanwhile, growth in exports to China is beneficial for India as it has huge trade deficit with the neighbouring country. Trade deficit with China increased to $63.12 billion in 2017-18 from $51.11 billion in 2016-17.

The CNX Nifty traded in a range of 11,588.50 and 11,452.45. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing Finance up by 9.01%, Zee Entertainment up by 4.83%, Adani Ports & SEZ up by 4.01%, HCL Tech. up by 4.01% and UPL up by 3.56%. On the flip side, Hindalco down by 2.19%, Tata Steel down by 2.09%, ONGC down by 2.09%, Dr. Reddy’s Lab down by 1.52% and Power Grid down by 1.35% were the top losers.

European markets were trading in green; UK’s FTSE 100 gained 46.82 points or 0.65% to 7,241.01, France’s CAC rose 14.96 points or 0.28% to 5,316.20 and Germany’s DAX was up by 44.33 points or 0.39% to 11,463.37.

Asian markets ended mostly in red on Thursday, as sliding US bond yields rekindled growth concerns and the British Parliament failed to agree on an alternative to Prime Minister Theresa May's withdrawal plan. Japanese shares led regional losses as Brexit uncertainty coupled with fears of slowing growth drove investors to the safety of safe-haven assets such as gold and the yen. Further, Chinese shares ended lower as investors awaited a resumption of trade talks between the world's two largest economies, United States and China.