Post Session: Quick Review

Indian equity benchmarks ended Friday’s trade on lower note with losses of around half a percent, on the back of sustained selling activities by market-participants amid weak global cues. Both the indices had opened marginally higher but soon gave up gains, as traders remain concerned about a report that India’s monsoon rains were below average for the fourth straight week, with rainfall scanty over central and western parts of the country in the week ended on June 26, raising concerns about major crop production and the impact on the nation's economy. Selling further crept in with Governor Shaktikanta Das calling for more cooperation between the government and the Reserve Bank to help boost the sagging growth engine and to ensure systemic stability. A dip in consumption and private investment has exerted pressure on the fiscal math.

Local barometer gauges added some losses in the late afternoon session, as sentiments on the street weakened further after the Directorate General of GST intelligence (DGGI) detected good and services tax (GST) evasion amounting to Rs 300 crore across Nagpur zone, which includes Vidarbha, Marathwada and Nasik regions of Maharashtra. However, down-ward move got restricted as traders found some solace with the Reserve Bank of India’s (RBI’s) Financial Stability Report (FSR) stating that the financial system remains stable despite some dislocation of late. It said the proportion of commercial lenders' non-performing assets (NPAs) may fall slightly to 9% by March, but recommended that the vigil on non-banking finance companies (NBFCs) continues.

On the global front, Asian markets ended mostly lower on Friday as a cautious mood prevailed ahead of key Trump-Xi meeting at the G20 summit that began in Osaka, Japan. European markets were trading in green. Back home, Telecom stocks ended lower amid Moody's Investors Service’s statement that the proposed spectrum auctions in India, which includes radiowaves for 5G technology, are likely to be held only in the second half of 2020 or later, given the stressed balance sheets of telecom operators. 

The BSE Sensex ended at 39393.80, down by 192.61 points or 0.49% after trading in a range of 39361.92 and 39675.25. There were 10 stocks advancing against 21 stocks declining on the index. (Provisional)

The broader indices ended mixed; the BSE Mid cap index fell 0.28%, while Small cap index was up by 0.00%.(Provisional)

The top gaining sectoral indices on the BSE were Consumer Durables up by 0.48%, Realty up by 0.39%, FMCG up by 0.26%, Utilities up by 0.18% and Capital Goods up by 0.16%, while Energy down by 1.53%, Telecom down by 1.23%, Metal down by 1.18%, Oil & Gas down by 0.74% and Basic Materials down by 0.73% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Bajaj Finance up by 1.15%, Axis Bank up by 1.15%, Hindustan Unilever up by 0.89%, Maruti Suzuki up by 0.75% and Tech Mahindra up by 0.57%. (Provisional)

On the flip side, Yes Bank down by 3.25%, Indusind Bank down by 2.49%, Tata Motors - DVR down by 2.44%, Tata Motors down by 2.02% and Reliance Industries down by 1.72% were the top losers. (Provisional)

Meanwhile, the rating agency ICRA in its latest report stated that the demand for cement has been tepid in the first quarter of the current financial year (Q1FY20) due to slowing of the project execution on account of general elections. However, it expects the demand to pick up from the third quarter of the fiscal, post-monsoon season and expects it to increase by nearly 7 per cent during for FY20.

It also said the growth is likely to be driven by housing, primarily rural housing and affordable housing, and improved focus on infrastructure segments, mainly road, railway and irrigation projects. Talking about profitability, it noted that in Q1FY20, the higher cement prices and lower costs power and fuel and freight expenses are likely to result in margin recovery.

It further said that in Q2FY20, the consumption is expected to be on lower side owing to the monsoon season. In April this year, cement production stood at 28.7 million MT, which was lower by 13.3 per cent as compared to March 2019.

The CNX Nifty ended at 11789.20, down by 52.35 points or 0.44% after trading in a range of 11775.50 and 11871.70. There were 18 stocks advancing against 32 stocks declining on the index. (Provisional)

The top gainers on Nifty were GAIL India up by 1.65%, Bajaj Finserv up by 1.17%, Bajaj Finance up by 1.12%, Axis Bank up by 1.08% and Adani Ports &SEZ up by 0.97%. (Provisional)

On the flip side, Indiabulls Housing Finance down by 3.26%, Bharti Infratel down by 3.13%, Yes Bank down by 3.11%, Indusind Bank down by 2.40% and Coal India down by 2.27% were the top losers. (Provisional)

European markets were trading in green; UK’s FTSE 100 increased 18.12 points or 0.24% to 7,420.45, France’s CAC increased 10.51 points or 0.19% to 5,504.12 and Germany’s DAX increased 57.92 points or 0.47% to 12,328.95.

Asian markets ended mostly lower on Friday as a cautious mood prevailed ahead of key Trump-Xi meeting at the G20 summit that began in Osaka, Japan. US President Trump and Chinese President Xi are not expected to come out of the meeting with a finalized trade deal, but investors are hoping for a temporary truce on tariffs. Chinese shares ended lower after Trump's top economic advisor, Larry Kudlow, on Thursday said that there are no preconditions set for the Trump-Xi meeting and the White House may move forward with additional tariffs, if the talks do not end in progress. Further, Japanese shares ended lower, dragged down by cyclicals as investors digested a raft of mixed data and kept an eagle eye on the G20 summit. Industrial output in Japan climbed a seasonally adjusted 2.3 percent month-on-month in May, the government said in a preliminary reading. That beat forecasts for an increase of 0.7 percent. Overall inflation in the Tokyo region rose an annual 1.1 percent in June, unchanged from the May reading, although it exceeded forecasts for 1.0 percent. The jobless rate in Japan came in at a seasonally adjusted 2.4 percent in May, in line with expectations and unchanged from the previous month.