Post Session: Quick Review

Extending their losing streak for fifth straight session, Indian equity benchmarks ended Wednesday’s trade on a pessimistic note, as weak corporate earnings, hinting at an economic slowdown, kept investors’ sentiment muted. After making a cautious start, benchmark indices traded with deep cuts, as traders remained cautious with report that the International Monetary Fund (IMF) projected a slower growth rate for India in 2019 and 2020, a downward revision of 0.3 per cent for both the years, saying its GDP will now grow respectively at the rate of 7 and 7.2 per cent reflecting a weaker-than expected outlook for domestic demand. Though, it also said India will still be the fastest growing major economy of the world and much ahead of China.

Markets continued weak run in late trade, as sentiments were further dampened with the Minister of State for Finance Anurag Singh Thakur stating that there is no official estimation of black money in the country, however, it has taken several concrete steps to crack down on illicit funds. However, the markets managed to trim some of their initial losses, as traders found some solace with Finance minister Nirmala Sitharaman signalled that the government may extend the lower corporate tax rate of 25% to all companies, giving India Inc something to cheer about. Her July 5 budget had lowered the rate for most companies but excluded the biggest. Meanwhile, in line with evolving macro-economic environment, the Reserve Bank of India (RBI) has launched Utkarsh 2022, the central banks' medium- term strategy framework.

On the global front, Asian markets ended mixed on Wednesday amid fresh optimism about US-China trade talks and a batch of stronger-than-expected earnings from the US helping underpin investor sentiment. European markets were trading mostly in red, subdued by dour signals from Deutsche Bank and Aston Martin, as well as a slide in commodity-linked stocks, with weak euro zone manufacturing and services surveys adding to worries on the outlook for growth.

The BSE Sensex ended at 37869.19, down by 113.55 points or 0.30% after trading in a range of 37708.41 and 38102.84. There were 7 stocks advancing against 24 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index fell 1.51%, while Small cap index was down by 1.27%.(Provisional)

The only gaining sectoral index on the BSE was FMCG up by 0.21%, while Metal down by 2.50%, Basic Materials down by 2.01%, Auto down by 2.01%, Oil & Gas down by 1.68% and Industrials down by 1.53% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Asian Paints up by 3.97%, HDFC up by 2.30%, Hindustan Unilever up by 2.04%, HCL Tech. up by 1.12% and HDFC Bank up by 0.93%. (Provisional)

On the flip side, Indusind Bank down by 3.89%, Tata Motors - DVR down by 3.60%, Bajaj Finance down by 3.43%, Tata Motors down by 3.04% and Tata Steel down by 2.86% were the top losers. (Provisional)

Meanwhile, the International Monetary Fund (IMF) in its World Economic Update has revised downward India’s Gross Domestic Product (GDP) growth forecast by 0.3% for 2019 and 2020 to 7.0% and 7.2%, respectively, over its previous projections early this year. It said the downward revision for both years reflects a weaker-than expected outlook for domestic demand. However, it also said the country will still be the fastest growing major economy of the world and much ahead of China.

In China, it said the negative effects of escalating tariffs and weakening external demand have added pressure to an economy already in the midst of a structural slowdown and needed regulatory strengthening to rein in high dependence on debt. It further said with policy stimulus expected to support activity in the face of the adverse external shock, growth is forecast at 6.2% in 2019 and 6.0% in 2020 -- 0.1 percentage point lower each year.

On the global growth, the IMF said dynamism in the global economy is being weighed down by prolonged policy uncertainty as trade tensions remain heightened despite the recent US-China trade truce, technology tensions have erupted threatening global technology supply chains, and the prospects of a no-deal Brexit have increased. It added that a major downside risk to the outlook remains an escalation of trade and technology tensions that can significantly disrupt global supply chains.

The CNX Nifty ended at 11275.65, down by 55.40 points or 0.49% after trading in a range of 11229.80 and 11359.75. There were 11 stocks advancing against 39 stocks declining on the index. (Provisional)

The top gainers on Nifty were Zee Entertainment up by 4.78%, Asian Paints up by 3.94%, HDFC up by 2.13%, Hindustan Unilever up by 2.13% and Bharti Infratel up by 1.28%. (Provisional)

On the flip side, UPL down by 5.24%, Adani Ports &SEZ down by 4.80%, Indiabulls Housing Finance down by 4.46%, Eicher Motors down by 4.31% and Indusind Bank down by 3.74% were the top losers. (Provisional)

European markets were trading mostly in red; UK’s FTSE 100 decreased 73.73 points or 0.98% to 7,483.13 and France’s CAC fell 32.46 points or 0.58% to 5,585.70, while Germany’s DAX increased 13.58 points or 0.11% to 12,504.32.

Asian markets ended mixed on Wednesday amid fresh optimism about US-China trade talks and a batch of stronger-than-expected earnings from the US helping underpin investor sentiment. Traders awaited policy decisions from the European Central bank and the US Federal Reserve to see how much and how fast policymakers might ease policy. Chinese shares ended higher after White House economic adviser Larry Kudlow said it was a good sign that top US officials would travel to China for reviving stalled trade talks. Japanese shares closed up as investors cheered by upbeat private sector activity data. Japan's private sector activity growth improved in July driven by the service sector, flash survey data from IHS Markit showed. The Jibun Bank flash composite output index rose to 51.2 in July from 50.8 in June.