Post Session: Quick Review

In choppy session of trade, Indian equity benchmarks gave up all of their gains to end flat on Thursday, with Nifty ending just shy of 11,850 mark. Domestic stocks saw a positive opening, as traders took some support with Arvind Panagariya’s statement that the escalating trade war between the US and China is an opportune time for India to attract the large multinationals looking for alternative locations outside the Communist country. Buying further crept in with a private report that the government can look at issuing infrastructure bonds via a special purpose vehicle (SPV), which could mop up over Rs 95,000 crore or 0.5 percent of GDP, as it looks for means to push growth.

Markets maintained their gaining momentum in afternoon session, taking support from the department for promotion of industry and internal trade's (DPIIT) Secretary Ramesh Abhishek’s statement that National Retail Policy will streamline the retail trade in India and is poised to provide the ease of doing business, which may be to the advantage of both traders and Indian economy. Some optimism also came with reports that RBI’s panel recommended financial support of Rs 15,000 crore to the micro, small and medium enterprises (MSME) sector. However, the markets failed to remain in the green zone as some anxiety remained among investors with a report that the cumulative debt of the National Highway Authority of India (NHAI) has mounted to Rs 1.78 lakh crore in FY19 from around Rs 40,000 crore in FY14. The borrowing is expected to go up to Rs 3.31 lakh crore by FY23.

On the global front, Asian markets ended mostly higher on Thursday on hopes of a tentative trade truce between the United States and China. European markets were trading mostly in red. Back home, defance stocks were in focus as India's defence industry received foreign direct investment (FDI) of a meagre USD 2.18 million during 2018-19. As per the current policy, foreign investment beyond 49 per cent is permitted through the approval route in the defence sector. The FDI limit for the defence sector has also been made applicable to the manufacturing of small arms and ammunition covered under Arms Act, 1959.

The BSE Sensex ended at 39589.27, down by 2.81 points or 0.01% after trading in a range of 39510.44 and 39817.22. There were 20 stocks advancing against 11 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index rose 0.39%, while Small cap index was up by 0.53%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 1.73%, Telecom up by 1.28%, Auto up by 1.12%, Consumer Durables up by 0.71% and Consumer Discretionary Goods & Services up by 0.69% while, Energy down by 0.79%, IT down by 0.64%, TECK down by 0.39%, Utilities down by 0.28% and Metal down by 0.25% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Tata Motors - DVR up by 4.01%, Mahindra & Mahindra up by 2.67%, Tata Motors up by 2.45%, Axis Bank up by 1.53% and HDFC up by 1.49%. (Provisional)

On the flip side, Tech Mahindra down by 2.14%, HCL Tech. down by 1.61%, Reliance Industries down by 1.57%, ITC down by 1.37% and Infosys down by 1.27% were the top losers. (Provisional)

Meanwhile, Telecom Minister Ravi Shankar Prasad has said foreign direct investment (FDI) in the Indian telecom sector declined by around 43 percent to $2.6 billion in last financial year (FY19). The FDI equity inflow in the FY18 was $6,211.84 million whereas the FDI equity inflow in the FY19 was $2,667.91 million.

He stated that the quantum and nature of FDI inflows depend on many factors and accordingly no specific reasons can be attributed for increase or decrease of inflows on year-to-year basis. He further said that there has been neither a regulatory uncertainty nor the lack of conducive environment to invest in the telecom sector which may be cited as a reason for the year-to-year decline in FDI. Stressed financial conditions, if any, cannot be held responsible for year-to-year decline.

Besides, he said the telecom sector is facing financial stress due to stiff competition and reduction in tariffs. The gross revenue of two private operators Airtel and Vodafone Idea has also reduced in financial years 2017-18 and 2018-19. Besides, he mentioned that according to an inter-ministerial group report submitted on August 31, 2017, the total debt of the telecom industry was Rs 7.88 lakh crore.

The CNX Nifty ended at 11847.10, down by 0.45 points after trading in a range of 11821.05 and 11911.15. There were 28 stocks advancing against 22 stocks declining on the index. (Provisional)

The top gainers on Nifty were Indiabulls Housing Finance up by 2.61%, Mahindra & Mahindra up by 2.60%, Tata Motors up by 2.45%, Eicher Motors up by 1.91% and Bharti Infratel up by 1.81%. (Provisional)

On the flip side, Tech Mahindra down by 2.12%, Adani Ports &SEZ down by 1.70%, HCL Tech. down by 1.59%, Reliance Industries down by 1.53% and ITC down by 1.32% were the top losers. (Provisional)

European markets were trading mostly in red; UK’s FTSE 100 decreased 8.37 points or 0.11% to 7,408.02 and France’s CAC decreased 10.80 points or 0.2% to 5,489.92, while Germany’s DAX increased 28.07 points or 0.23% to 12,273.39.

Asian markets ended mostly higher on Thursday as comments from US Treasury Secretary Steven Mnuchin generated optimism about a potential US-China trade deal. US Treasury Secretary Steven Mnuchin told the US and China had nearly completed a deal before talks broke down last month. However, he didn't shed any light on the sticking points to achieving the final 10 percent and refused to speculate on whether a deal would be completed. Separately, US President Donald Trump voiced optimism over the possibility of a trade agreement with China but said he is still considering imposing ‘very substantial’ tariffs on all Chinese imports if the two countries were unable to reach a deal during the G20 meeting that starts Friday. Chinese shares ended higher as investors digested positive industrial profits data and signs of a truce in the Sino-US trade war. Further, Japanese shares rose sharply amid the dollar hit one-week highs against the yen as investors cheered signs of a truce in the Sino-US trade war.