Benchmarks trade in fine fettle; Sensex reclaims 40,000 mark

Indian equity benchmarks made a positive start and are trading in fine fettle in early deals on Friday, as traders remain energized with industry body FICCI's economic outlook survey showed that India's GDP is likely to grow 6.5 per cent in the fourth quarter ended March 2019. FICCI survey has put forth an annual median GDP growth forecast for 2019-20 at 7.1 per cent and the projection for fiscal 2020-21 has been put at 7.2 per cent. Sentiment was also buoyed on a report that India Inc. has welcomed the new term and team of Prime Minister Narendra Modi and hoped that it would be able to give new impetus to the economy, which is facing slowdown in several sectors. Investor’s sentiment remained largely positive with a market research firm ICRA stated that Railways, roads and highways sector are to get the largest chunk of investment over the next five years as the government is expected to spend Rs 30 trillion in the transport sector in India.

On the global front, the US markets ended higher on Thursday, but gains were limited as investors remained nervous about the impact of the trade war with China even though the latest data showed economic growth was healthy in the first quarter. Asian markets are trading mixed on Friday as Chinese economic data came in below expectations. The official manufacturing Purchasing Managers’ Index (PMI) for May came in at 49.4.

Back home, the Reserve Bank of India (RBI) has announced calendar for issuance of Sovereign Gold Bonds for the first half of the current fiscal. The Sovereign Gold Bonds (SGB) will be issued every month from June 2019 to September 2019. In scrip specific developments, Berger Paints surged on reporting 5% rise in Q4 consolidated net profit and Apollo Hospitals Enterprise soared on reporting 29% rise in Q4 net profit.

The BSE Sensex is currently trading at 40077.73, up by 245.76 points or 0.62% after trading in a range of 39941.19 and 40119.81. There were 27 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.62%, while Small cap index was up by 0.23%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.44%, Consumer Discretionary Goods & Services up by 0.90%, TECK up by 0.89%, Telecom up by 0.89% and IT was up by 0.88%, while Basic Materials was down by 0.05% the only losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 3.09%, Coal India up by 2.27%, Hero MotoCorp up by 1.46%, TCS up by 1.46% and HCL Tech was up by 1.29%. On the flip side, NTPC down by 0.22%, Vedanta down by 0.18%, Yes Bank down by 0.06% and Reliance Industries was down by 0.01% were the top losers.

Meanwhile, the industry chamber, Federation of Indian Chambers of Commerce and Industry (FICCI) in its latest economic outlook survey has stated that India's Gross Domestic Product (GDP) is likely to grow at 6.5% in the fourth quarter ended March 2019. Besides, it has put forth an annual median GDP growth forecast for 2019-20 at 7.1% and the projection for fiscal 2020-21 has been put at 7.2%. The minimum and maximum growth estimate stood at 6.8% and 7.3%, respectively, for 2019-20.

The survey was conducted in May 2019 among economists belonging to the industry, banking and financial services sector. The median growth forecast for agriculture and allied activities has been put at 3% for 2019-20. Industry and services sector are expected to grow by 6.9% and 8%, respectively, during the year. The outlook of participating economists on inflation remained moderate.

On the inflation front, the survey noted that the Wholesale Price Index (WPI)-based inflation rate is projected at 3.1% in 2019-20, with a minimum and maximum range of 2.1% and 4%, respectively. On the contrary, the survey found that retail inflation has a median forecast of 4% for 2019-20. Participants also expressed that concerns remain on the external front with median current account deficit forecast pegged at 2.1% of GDP for 2019-20. Median export growth is pegged at 4% in the financial year 2019-20. Imports, on the other hand, are forecast to grow at 3.8% in the same year.

FICCI further said that the majority of the participating economists believed that the US' decision to end waiver granted to countries amid sanctions imposed on Iran is significant and will affect major oil-importing countries, including India. This becomes a major concern at a time when international prices of crude oil have been on the rise due to other factors such as supply constraints being undertaken by OPEC countries.

The CNX Nifty is currently trading at 12024.80, up by 78.90 points or 0.66% after trading in a range of 11985.25 and 12033.45. There were 43 stocks advancing against 6 stocks declining on the index.

The top gainers on Nifty were Indian Oil Corporation up by 4.04%, Asian Paints up by 3.01%, BPCL up by 2.81%, Coal India up by 2.23% and Britannia Industries was up by 2.07%. On the flip side, Grasim Industries down by 1.75%, Yes Bank down by 0.55%, Vedanta down by 0.43%, Hindalco down by 0.28% and Bajaj Finserv was down by 0.20% were the top losers.

Asian markets are trading mixed; Taiwan Weighted strengthened 115.61 points or 1.11% to 10,498.60, Jakarta Composite soared 55.90 points or 0.92% to 6,160.01, KOSPI rose 5.71 points or 0.28% to 2,044.51 and Shanghai Composite was up by 0.20 points or 0.01% to 2,906.01. On the flip side, Straits Times slipped 17.65 points or 0.56% to 3,125.35, Hang Seng decreased 48.77 points or 0.18% to 27,066.11 and Nikkei 225 was down by 166.78 points or 0.8% to 20,775.75.