Indian markets ended higher with gains of around a percent on Friday amid buying in industry heavyweights such as Reliance Industries, Axis Bank, Maruti, Infosys and HDFC Bank. Today, the start of holiday-truncated week is likely to be in green tracking positive leads from Asian peers. Investors will be looking ahead to the macro-economic data, factory output (IIP) for July and retail inflation (CPI inflation) for August, scheduled to be out later in the week. Traders will be taking encouragement as amid ongoing slowdown of the economy, Union finance Minister Nirmala Sitharaman said that the government will respond to the challenges faced by all the sectors. Market participants may take note of report that the Central Government said that the current slowdown is temporary and the fundamentals of the Indian economy remain strong. Union Minister Prakash Javadekar said Indian economy is on a strong footing as the fundamentals are strong. Slowdown is a cyclical process. Some support will also come with Niti Aayog Chief Executive Officer Amitabh Kant’s statement that states will have to become key agents of growth to help achieve India’s target of becoming a $5 trillion economy. Meanwhile, the government has constituted a high-level task force to identify infrastructure projects for Rs 100 lakh crore investment by 2024-25 as India aims to become a $5 trillion economy. There will be some buzz in the auto stocks as automotive industry body SIAM sought government intervention to help the sector in the smooth transition to BS-VI emission norms from April next year, saying the prospect of abrupt stoppage of manufacturing and sales of BS-IV vehicles overnight posed a monumental challenge. There will be some reaction in power stocks with Power Minister R K Singh’s statement that the government is in the process of rolling out a new tariff policy and UDAY 2.0 to address the issue of losses of discoms, which is the only difficulty in ensuring round the clock electricity supply for all.
The US markets ended mostly higher on Friday as investors digested a mixed US jobs report and bet on a Federal Reserve interest rate cut this month, while China's stimulus plan helped ease some concerns around global growth. Asian markets are trading in green on Monday as investors pinned expectations on likely stimulus to support growth in the world's major economies.
Back home, Indian equity bourses gained traction on the last trading day of the week to end at higher note, with Sensex and Nifty gaining over 0.90% each. After a positive start, key indices remained bullish throughout the day, aided by Union Minister Nitin Gadkari’s statement that the government will soon take a call on the recommendations of U K Sinha committee to strengthen micro, small and medium enterprises sector. Traders took encouragement with Union Minister of state for heavy industries and public enterprises, Arjun Ram Meghwal’s statement that the government will do everything to ensure that the economy remains on track and is not weakened so that the country reaches its target of $5 trillion economy. Markets extended their gains in the second half of the session, on the back of positive cues from global markets. Domestic sentiments remained positive, as Agriculture Minister Narendra Singh Tomar said that the condition of Kharif (summer-sown) crops is good and the country is likely to have bumper production of foodgrains. The street paid no heed towards report that credit rating agency, CARE Ratings revised the India’s gross domestic products (GDP) estimate downward from 6.7-6.8% earlier to 6.4-6.5% for current financial year (FY20) with the underlying gross value added (GVA) growth of 6.3-6.4% on account of subdued growth in the industrial sector and weakness in the agricultural sector during Q1FY20. Finally, the BSE Sensex gained 337.35 points or 0.92% to 36,981.77, while the CNX Nifty was up by 98.30 points or 0.91% to 10,946.20.
