Markets end Wednesday's session on bearish note

Indian equity markets ended Wednesday's session on bearish note, as Sensex and Nifty settled with losses of over 350 and 85 points, respectively. The markets started on a cautious note, after the International Monetary Fund (IMF) lowered Gross Domestic Product (GDP) outlook for India. The IMF has moderately scaled down India’s economic growth projection to 7.3 per cent for the current financial year from its earlier forecast of 7.4 per cent and suggested that the country should continue to undertake economic reforms, including hire and fire, to create jobs. Trading sentiments also remained lackluster with the finance ministry’s statement that the government has fallen short of Rs 50,000 crore in its direct tax collection target of Rs 12 lakh crore for 2018-19.

Key indices extended their losses in last hours of trade to settle near their day’s low points. The markets participants remained worried, as the IMF cut its global growth forecast to the lowest level since the financial crisis, warning of significant downside risks to the world economy including trade tensions, pockets of political instability, mounting debt levels and increasing inequality. The IMF lowered its growth forecast for 2019 to 3.3 percent from the previous level of 3.5 percent in its latest World Economic Outlook (WEO). The street paid no heed towards a report stating that the government has managed to meet the revised fiscal deficit target of 3.4 percent of the GDP after it cut last minute expenditure and rolled over fuel subsidies to make up for the shortfall in tax collection.

On the global front, European markets were trading in green, after Finland's trade balance led to a surplus in February as exports rose, while imports were broadly unchanged. The data from the Finnish Customs showed that trade balance swung to a surplus of EUR 95 million in February from a deficit of EUR 95 million in the same month previous year. In January, trade deficit was EUR 40 million. Exports rose 7 percent year-on-year, while imports were unchanged. Asian markets ended mixed, as growth worries coupled with geopolitical issues like US-China trade tensions and Brexit served to keep the underlying mood cautious.

Back home, selected stocks of the auto industry ended lower, as automobile dealers' body Federation of Automobile Dealers Associations (FADA) said that retail sales of passenger vehicles (PV) in March declined by 10 per cent to 2,42,708 units as compared to the same period last year. PV sales stood at 2,69,176 units in March 2018. Further, airlines stocks remained in focus, after the Directorate General of Civil Aviation (DGCA) asked each of the airlines to bring individual medium-term plan on enhancing overall availability of domestic flights, in a bid to curb rising airfares.

Finally, the BSE Sensex slipped 353.87 points or 0.91% to 38,585.35, while the CNX Nifty was down by 87.65 points or 0.75% to 11,584.30.

The BSE Sensex touched a high and a low of 38,950.45 and 38,542.28, respectively and there were 09 stocks advancing against 22 stocks declining on the index.

The broader indices ended in red; the BSE Mid cap index lost 0.33%, while Small cap index was down by 0.02%.

The top gaining sectoral indices on the BSE were Realty up by 0.96%, Healthcare up by 0.51%, Industrials up by 0.30%, Auto up by 0.21% and Consumer Durables up by 0.07%, while Telecom down by 2.09%, TECK down by 1.05%, Metal down by 1.01%, IT down by 0.90% and Utilities down by 0.89% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 4.68%, Tata Motors - DVR up by 3.18%, Hindustan Unilever up by 0.78%, Kotak Mahindra Bank up by 0.61% and Coal India up by 0.55%. On the flip side, Bharti Airtel down by 3.28%, Asian Paints down by 2.15%, TCS down by 2.12%, HDFC Bank down by 2.07% and HDFC down by 1.96% were the top losers.

Meanwhile, the International Monetary Fund (IMF) in its latest edition of the fiscal monitor report has said that some reforms in India show the benefits of digitalization and reducing opportunities for discretion and fraud.

IMF highlighted the benefits of implementation of e-procurement system in country, saying that the move enhanced competition and led to better quality of construction. Besides, it said that the adoption of an electronic platform for managing a social assistance programme in India resulted in a 17 per cent decline in spending with no corresponding decline in benefits.

International Monetary Fund also underlined reforms done on state level, noting that in Andhra Pradesh, the use of smart ID cards that are used to identify beneficiaries of specific programmes and improve beneficiaries' access to information helped reduce leakage by 41 per cent relative to the control group.

The CNX Nifty traded in a range of 11,680.05 and 11,571.75. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 4.81%, Wipro up by 2.72%, Cipla up by 2.72%, Adani Ports up by 1.13% and Hindustan Unilever up by 1.10%. On the flip side, Bharti Airtel down by 3.74%, Hindalco down by 2.56%, Asian Paints down by 2.43%, TCS down by 2.29% and UPL down by 2.22% were the top losers.

European markets were trading in green; UK’s FTSE 100 increased 5.90 points or 0.08% to 7,431.47, France’s CAC rose 21.62 points or 0.4% to 5,458.04 and Germany’s DAX was up by 47.83 points or 0.4% to 11,898.40.

Asian markets ended mixed on Wednesday, as growth worries coupled with geopolitical issues like US-China trade tensions and Brexit dented investors' appetite for risk. Global Times' editorial urged patience after US President Donald Trump said a trade deal could be reached in about four weeks. It is still uncertain when, or even whether, Beijing and Washington can reach a trade deal. Further, the International Monetary Fund slashed its global economic growth forecast once again on Tuesday, and said it expects the world economy to grow by 3.3 percent this year. That’s down from its previous outlook of 3.5 percent, which was also a downgrade. The IMF added that it expects the economy to expand by 3.6 percent in 2020. Japanese shares ended lower as investors kept an eye on escalating trade tensions between the United States and Europe and an upcoming press conference by European Central Bank President Mario Draghi.