Markets recover to close in green

Indian equity bourses staged recovery to close the Thursday’s trading session in green terrain, with Sensex and Nifty reclaiming their crucial psychological levels of 38,600 and 11,550, respectively. After cautious start, key indices traded volatile during the whole session, affected by Federation of Indian Export Organisations’ (FIEO) statement that rising protectionism, fluctuation in commodity prices and inadequate availability of liquidity are the three major challenges, which exporters will face in the coming months. Investors also got worried after the International Monetary Fund (IMF) favoured bolstering the level of capitalisation of some banks, particularly government-owned banks, noting that the level of non-performing loans in India remains high. Besides, the market participants remained cautious ahead of releases of March quarter earnings and inflation data.

In the last leg of the trade, markets managed to erase their losses and ended higher. Traders got relief with reports that the government extended the last date for filing final sales return form GSTR-1 for March by two days till April 13. Similarly, the due date for furnishing tax deducted at source (TDS) return GSTR-7 for March has also been extended till April 12. The last date for filing GSTR-1 and GSTR-7 for the month was April 11 and April 10, respectively. Separately, Finance Minister Arun Jaitley has discussed India's economic reforms and outlook for the future with investors in US. The street paid no heed towards the Agricultural and Processed Food Products Export Development Authority’s (APEDA) data showing data the country's exports of agricultural and processed food products have dipped by 2.27 per cent to $16.27 billion during the April-February period of 2018-19, on account of contraction in shipments of buffalo meat, wheat and non-basmati rice.

On the global front, European markets were treading in green, as France industrial production grew for the third consecutive month in February, defying expectations for a decline. The data from the statistical office INSEE showed that industrial production climbed a seasonally and working day adjusted 0.4 percent month-on-month in February, after a 1.2 percent rise in January. On the inflation front, Norway consumer price inflation fell to its weakest level in nine-month, though marginally, for the third month in a row in March. As per figures from Statistics Norway, the consumer price index climbed 2.9 percent year-on-year in March, after a 3.0 percent rise in February. Asian markets ended mixed, as fears of a global growth slowdown intensified, offsetting a temporary Brexit relief.

Back home, stocks related to the telecom sectors ended higher, as the Department of Telecommunications (DoT) set up a committee that will look into contentious issues arising out of telecom companies that are going through the insolvency process. Besides, selected metal sector stocks also ended in green, aided by the Indian Steel Association’s statement that steel demand in India is likely to grow by 7.1 percent in calendar year 2019 and by 7.2 percent in the next calendar year 2020 driven by sectors like construction, capital goods and railways. As for financial years 2019-20 and 2020-21, it forecasted steel demand to grow by 7.2 percent. Besides, it noted that the country’s steel consumption is poised to cross the psychological 100-million tonne (MT) mark in 2019.

Finally, the BSE Sensex gained 21.66 points or 0.06% to 38,607.01, while the CNX Nifty was up by 12.40 points or 0.11% to 11,596.70.

The BSE Sensex touched a high and a low of 38,649.98 and 38,460.25, respectively and there were 18 stocks advancing against 13 stocks declining on the index.

The broader indices ended mixed; the BSE Mid cap index rose 0.09%, while Small cap index was down by 0.02%.

The top gaining sectoral indices on the BSE were Energy up by 1.11%, Telecom up by 1.06%, Oil & Gas up by 0.94%, Consumer Durables up by 0.86% and FMCG up by 0.52%, while Metal down by 1.18%, IT down by 1.07%, TECK down by 0.80%, Realty down by 0.45% and Basic Materials down by 0.34% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 2.19%, Bajaj Auto up by 1.76%, Bajaj Finance up by 1.56%, Tata Motors - DVR up by 1.47% and Reliance Industries up by 1.29%. On the flip side, Vedanta down by 3.72%, Infosys down by 1.46%, Sun Pharma down by 1.38%, Tata Steel down by 1.30% and Axis Bank down by 1.27% were the top losers.

Meanwhile, International Monetary Fund's (IMF) Fiscal Affairs Deputy Director Paul Mauro said that India has a lot of scope for reducing some food and fertiliser subsidies, while also taking steps to ensure that the growth is inclusive and poverty is reduced. He underlined that the economy is growing in excess of 7 per cent, and the objective there is to make sure that that growth is inclusive and it filters down to poverty reduction.

He mentioned there is a lot of scope for reducing untargeted food and fertiliser subsidies and for enhancing revenue administration, including for the Goods and Services Tax (GST) and adding that improved tax compliance would be a priority for India.

Besides, the Fiscal Monitor report noted that the recently announced farm-income-support programme alongside weaker-than-expected goods and services tax revenues led to a deterioration relative to the previous central government budget outturn. The 'Pradhan Mantri Kisan Samman Nidhi' (PM-KISAN) scheme announced in the interim budget will give small and marginal farm households a guaranteed annual income support of Rs 6,000. The report also said that digitisation helped reduce fraud and also introduced economies.

The CNX Nifty traded in a range of 11,606.70 and 11,550.55. There were 28 stocks advancing against 21 stocks declining, while 1 remained unchanged on the index.

The top gainers on Nifty were Indiabulls Housing Finance up by 2.54%, Bharti Airtel up by 2.00%, Bajaj Finserv up by 1.84%, Bajaj Auto up by 1.67% and Dr. Reddy’s Lab up by 1.56%. On the flip side, Vedanta down by 3.79%, Sun Pharma down by 1.41%, Power Grid down by 1.36%, Tech Mahindra down by 1.30% and Axis Bank down by 1.26% were the top losers.

European markets were trading in green; UK’s FTSE 100 increased 2.09 points or 0.03% to 7,424.00, France’s CAC rose 30.37 points or 0.56% to 5,480.25 and Germany’s DAX was up by 6.03 points or 0.05% to 11,911.94.

Asian markets ended mixed on Thursday, as dovish messages being sent from the ECB and the Federal Reserve added to investor concerns over slowing global growth. Investors also braced for more Brexit uncertainty after EU leaders agreed to extend the date of Britain's departure from the bloc to the end of October. Chinese shares ended lower despite more signs of progress in US-China trade talks. US Treasury Secretary Steven Mnuchin said that a call with Chinese Vice-Premier Liu He on Tuesday night was productive and the two sides have settled on a mechanism to police any agreement, including new enforcement offices. Meanwhile, Japanese shares ended little changed as the yen strengthened and investors awaited earnings results from Yaskawa Electric, a manufacturer with large exposure to China.