Indian equities remain in green terrain

In a volatile trade, Indian equity benchmarks continued their trade in green territory in late afternoon deals, on buying by funds and retail investors. Sentiments remained positive with Niti Aayog CEO Amitabh Kant’s statement that circular economy has the potential to generate 1.4 crore jobs in next 5-7 years and create lakhs of new entrepreneurs. Traders took note of private report stating that the government is in the process of fixing draft norms for individual insolvency and might come up with a three-tiered debt resolution system, depending on the amount of loan borrowed. However, gains remained capped as anxiety remained among the local traders as Fitch lowered India's growth forecast to 6.6 per cent for the current fiscal from 6.8 per cent projected earlier, as manufacturing and agriculture sectors showed signs of slowing down over the past year. On the sectoral front, defence sector remained in focus with Sanjay Jaju, Joint Secretary in the Ministry of Defence stating that the government will launch 'Open General Export License' scheme in a month to boost defence exports.

On the global front, European markets were trading mostly in green, after European Central Bank chief Mario Draghi promised more monetary stimulus if the economy does not improve, offsetting another warning on slowing sales from the chip sector. Asian markets were trading mostly in green, as investors awaited the start of a closely-watched meeting by the U.S. Federal Reserve, set to kick off later stateside.

The BSE Sensex is currently trading at 39037.69, up by 76.90 points or 0.20% after trading in a range of 38960.25 and 39167.25. There were 18 stocks advancing against 13 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index rose 0.32%, while Small cap index was down by 0.05%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.03%, PSU up by 0.94%, Consumer Durables up by 0.52%, IT up by 0.52% and Power was up by 0.49%, while Telecom down by 0.55%, FMCG down by 0.30%, Auto down by 0.08% and Healthcare was down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Vedanta up by 2.68%, ICICI Bank up by 1.89%, Indusind Bank up by 1.77%, Coal India up by 1.53% and Power Grid was up by 1.52%. On the flip side, Yes Bank down by 6.93%, Tata Motors - DVR down by 1.35%, Asian Paints down by 1.17%, Maruti Suzuki down by 0.99% and HDFC was down by 0.89% were the top losers.

Meanwhile, Ratings agency Crisil in its latest report has said that the US government's decision to roll back export incentives provided under Generalised System of Preferences (GSP) scheme will hit exporters of gems and jewellery the most because around 15 percent of such exports availed of its benefits in calendar 2018. It also noted that currently, there will be an additional duty of around 7 percent on exports of precious metal-based and imitation jewellery, which will reduce competitiveness of domestic exporters and put pressure on margins.

According to the report, the gems and jewellery sector in India is already under pressure on account of stringent lending rules and working- capital crunch. However, it expects a limited impact on the country's overall export trade.

Crisil has indicated that in 2018, India's goods and services trade with the US totalled $142.1 billion, with exports constituting $83.2 billion. It said that within exports, that under GSP is estimated to be 7.5-7.8 percent, which translates into around $260 million of levies saved, tantamount to a 4 percent duty benefit. For the pharmaceutical sector, it expects the impact of GSP withdrawal to be minimal. The US market accounts for 35-37 percent of Indian formulation exports.

The CNX Nifty is currently trading at 11688.55, up by 16.40 points or 0.14% after trading in a range of 11662.80 and 11727.20. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Vedanta up by 2.68%, Zee Entertainment up by 2.17%, ICICI Bank up by 1.99%, Indusind Bank up by 1.86% and BPCL was up by 1.63%. On the flip side, Yes Bank down by 6.59%, Indiabulls Housing Finance down by 5.77%, Bharti Infratel down by 1.47%, Hindalco down by 1.42% and Asian Paints was down by 1.15% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 271.61 points or 1% to 27,498.77, Jakarta Composite soared 40.27 points or 0.65% to 6,230.80, Taiwan Weighted strengthened 36.20 points or 0.34% to 10,566.74, Straits Times advanced 25.48 points or 0.79% to 3,233.47, KOSPI rose 7.98 points or 0.38% to 2,098.71 and Shanghai Composite was up by 2.54 points or 0.09% to 2,890.16. On the flip side, Nikkei 225 was down by151.29 points or 0.72% to 20,972.71.

European markets were trading mostly in green; UK’s FTSE 100 increased 14.65 points or 0.2% to 7,371.96 and France’s CAC was up by 18.38 points or 0.34% to 5,409.33, while Germany’s DAX was by15.40 points or 0.13% to 12,070.42.