Benchmarks trade in fine fettle in early deals

Indian equity benchmarks made an optimistic start and are trading in fine fettle in early deals on report that tax mop-up crossed Rs 1 lakh crore for the third straight month. The Goods and Services Tax (GST) collection in May came in at Rs 1,00,289 crore, clocking a growth of about 7% compared with the mop-up of Rs 94,016 crore in the corresponding month last fiscal. Some support also came with report that overseas investors pumped in a net amount of Rs 9,031 crore into the Indian capital markets in May on expectations of more business-friendly measures following the BJP's landslide victory in the general elections. Investors will be eyeing manufacturing PMI data to be out later in the day. Besides, the fiscal deficit for 2018-19 came in at 3.39% of GDP, marginally lower than 3.4% projected in the revised estimates of the Budget, mainly due to lower expenditure and increase in non-tax revenue. Traders shrugged off report that the growth of eight core infrastructure sectors slowed down to 2.6% in April, from 4.7% in the same month of pervious year, due to negative growth in crude oil, natural gas and fertiliser output.

On the global front, most of the Asian counters are trading in red at this point of time amid increasing concerns over the state of global trade. The US markets ended sharply lower on Friday as investors feared President Donald Trump’s surprise threat of tariffs on all Mexico imports, amid a worsening trade war with China.

Back home, confirming unemployment rate projected in a pre-election leaked report, the government said joblessness in the country was 6.1% of total labour force during 2017-18, the highest in 45 years. On the sectoral front, banking sector stocks edged higher despite rating agency Fitch’s statement that the performance of India’s banking sector is likely to be below average for the next two years because it is struggling with poor asset quality and weak core capitalization.

The BSE Sensex is currently trading at 39862.72, up by 148.52 points or 0.37% after trading in a range of 39711.02 and 39920.93. There were 21 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.49%, while Small cap index was up by 0.02%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 0.82%, Consumer Discretionary Goods & Services up by 0.80%, Realty up by 0.66%, Auto up by 0.64% and Metal up by 0.52%, while there were no losers on the BSE sectoral front.

The top gainers on the Sensex were Hero MotoCorp up by 3.94%, Asian Paints up by 2.88%, Bajaj Auto up by 2.36%, Power Grid Corporation up by 1.22% and Tata Steel up by 1.10%. On the flip side, ONGC down by 1.77%, Mahindra & Mahindra down by 1.39%, Tata Motors - DVR down by 0.78%, ITC down by 0.52% and Yes Bank down by 0.44% were the top losers.

Meanwhile, with poor performance by agriculture and manufacturing sectors, India’s gross domestic product (GDP) grew at its slowest pace in the January-March period of fiscal year 2018-19 (FY19) and hit a 5-year low of 5.8%. With this reading, India lost fastest-growing large economy tag to China for the first time in two-year. China's economy posted 6.4% growth in the March quarter. For the entire FY19, GDP growth stood at 6.8%, a five-year low after FY14, when the economy grew at 6.4%. In FY18, India's economy had grown at 7.7%. GDP growth figures for FY19 was even lower than the second advanced estimate released by the statistics office in February, which estimated FY19 economic growth at 7%.

The Central Statistics Office, in its latest estimate showed that GDP at Constant (2011-12) Prices in Q4 of 2018-19 is estimated at Rs 37.20 lakh crore, as against Rs 35.15 lakh crore in Q4 of 2017-18, showing a growth rate of 5.8%. GDP growth rates for Q1, Q2 and Q3 of 2018-19 at Constant Prices (2011-12) are 8.0%, 7.0% and 6.6%, respectively. GVA at Basic Prices at Constant (2011-12) Prices in Q4 of 2018-19 is estimated at Rs 33.06 lakh crore, as against Rs 31.27 lakh crore in Q4 of 2017-18, showing a growth rate of 5.7%.

GDP at Current Prices in Q4 of 2018-19 is estimated at Rs 50.16 lakh crore, as against Rs 45.85 lakh crore in Q4 of 2017-18, showing a growth of 9.4%. GDP at Current Prices for the year 2018-19 is estimated at Rs 190.10 lakh crore, showing a growth rate of 11.2% over the First Revised Estimates of GDP for the year 2017-18 of Rs 170.95 lakh crore. GVA at Current Basic Prices in Q4 of 2018-19 is estimated at Rs 44.02 lakh crore, as against Rs 40.20 lakh crore in Q4 of 2017-18, showing a growth of 9.5%.

The GVA in agriculture, forestry and fishing sectors contracted by 0.1% as against an expansion of 6.5% recorded in fourth quarter of 2017-18. The slowdown was quite steep in the key manufacturing segment as the GVA expansion was meagre 3.1% down from 9.5% during fourth quarter of 2017-18. However, the 'financial, real estate and professional services' segment showed improvement with the growth rate moving up to 9.5% in the last quarter of 2018-19 from 5.5% in the comparable period of the preceding fiscal.

The per capita income in real terms (at 2011-12 Prices) during 2018-19 is estimated to have attained a level of Rs 92,565 as compared to Rs 87,623 for the year 2017-18. The growth rate in per capita income is estimated at 5.6% during 2018-19, as against 5.7% in the previous year. Private Final Consumption Expenditure (PFCE) at Current Prices is estimated at Rs 112.90 lakh crore in 2018-19 as against Rs 100.83 lakh crore in 2017-18. Government Final Consumption Expenditure (GFCE) at Current Prices is estimated at Rs 21.35 lakh crore in 2018-19 as against Rs 18.86 lakh crore in 2017-18. Gross Fixed Capital Formation (GFCF) at Current Prices is estimated at Rs 55.70 lakh crore in 2018-19 as against Rs 48.97 lakh crore in 2017-18.

The CNX Nifty is currently trading at 11962.20, up by 39.40 points or 0.33% after trading in a range of 11920.10 and 11973.65. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Hero MotoCorp up by 3.88%, Asian Paints up by 3.01%, Bajaj Auto up by 2.20%, Britannia Inds up by 2.15% and Indian Oil Corp. up by 1.99%. On the flip side, ONGC down by 1.66%, Mahindra & Mahindra down by 1.65%, Indiabulls Housing down by 0.69%, Yes Bank down by 0.64% and ITC down by 0.59% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 tumbled 261.12 points or 1.27% to 20,340.07, Straits Times shed 5.80 points or 0.19% to 3,111.96, Hang Seng decreased 93.18 points or 0.35% to 26,807.91, Taiwan Weighted slipped 17.32 points or 0.16% to 10,481.17 and Shanghai Composite was down by 14.16 points or 0.49% to 2,884.54. On the flip side, KOSPI was up by 20.45 points or 1.00% to 2,062.19.