Post Session: Quick Review

Indian equity benchmarks gave up most of their losses in last leg of trade to come off their intraday low points, but failed to erase all losses and ended in red for second day. Markets opened in red, as traders were cautious with the RBI’s data showing that India's forex reserves declined by $388 million to $428.572 billion for the week ended September 20 due to a slide in core currency and gold assets. In the week to September 20, foreign currency assets, a major component of overall reserves declined by $125 million to $396.670 billion. Investors remained jittery with a report that India had a ‘worrisome’ debt burden of over Rs 88 lakh crore at the first financial quarter of 2019 with the government apparently having no inkling to deal with the country’s economic slowdown.

However, key indices narrowed their losses in late trade, taking support from report that in a boost to Prime Minister Narendra Modi’s ambitious target of India breaking into top 50 nations on the World Bank's ease of doing business ranking, the country has figured among the 20 countries that have improved the most on the list. Some support also came in on report that capital markets regulator SEBI eased its norms for buyback of shares by listed companies, especially those having subsidiaries in housing finance and NBFC segments. Meanwhile, the government will soon constitute a working group on the proposed new industrial policy which is aimed at promoting emerging sectors, reducing regulatory hurdles and making India a manufacturing hub.

On the global front, Asian markets ended mostly lower on Monday, amid conflicting signals on the trade-war front. Traders overlooked private business survey showing that China’s factory activity unexpectedly expanded at the fastest pace in 19 months in September as plants ramped up production and new orders rose, suggesting a modest recovery in the manufacturing sector. However, European markets were trading mostly in green. Back home, consumer durable industry stocks were in the focus with report that consumer durable industry hopes to have double-digit growth during the festive season sales, despite concerns of economic slowdown.

The BSE Sensex ended at 38682.87, down by 139.70 points or 0.36% after trading in a range of 38401.09 and 38873.12. There were 12 stocks advancing against 19 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index fell 1.11%, while Small cap index was down by 1.24%. (Provisional)

The top gaining sectoral indices on the BSE were Telecom up by 4.56%, TECK up by 2.58%, IT up by 2.39%, Energy up by 1.48% and Oil & Gas up by 0.76%, while Bankex down by 2.64%, Realty down by 1.70%, Healthcare down by 1.54%, Auto down by 0.94% and Consumer Durables down by 0.87% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Bharti Airtel up by 6.06%, HCL Tech. up by 3.71%, Infosys up by 3.02%, ITC up by 2.59% and TCS up by 2.21%. (Provisional)

On the flip side, Yes Bank down by 15.06%, Indusind Bank down by 6.15%, SBI down by 3.68%, ICICI Bank down by 3.34% and Tata Motors - DVR down by 3.02% were the top losers. (Provisional)

Meanwhile, the World Bank in its Doing Business 2020 report has ranked India as one of the ‘top 20 improvers’ based on the number of reforms which aid ease of doing business. It has recognized the measures taken for making it easier to do business in India in areas including obtaining construction permits through single-window system in Delhi and Mumbai; reducing cost to start a business by abolishing filing fees for the SPICe company incorporation form, electronic memorandum of association and articles of association; and integrating multiple government agencies online and upgrading port equipment and infrastructure that made exporting and importing easier.

It said ‘India’s achievements this year build on a sustained multi-year reform effort. Since 2003/04, India has implemented 48 reforms captured by Doing Business. The most improved business regulatory areas have been starting a business, dealing with construction permits and resolving insolvency.’ The other countries that made it to the list of top 20 improvers included Azerbaijan, Bahrain, Bangladesh, China, Djibouti, Jordan, Kenya, Kosovo, Kuwait, The Kyrgyz Republic, Myanmar, Nigeria, Qatar, Saudi Arabia, Tajikistan, Togo, Uzbekistan, Zimbabwe, and Pakistan. Though, the final list (annual ranking) by the World Bank for the best performing economies will be released on October 24 this year.

Economies are listed based on two criteria. First, Doing Business selects the economies that implemented reforms making it easier to do business in three or more of the 10 areas included in this year’s aggregate ease of doing business score. Second, Doing Business sorts these economies on the increase in their ease of doing business score due to reforms from the previous year. Besides, India jumped 23 positions to 77 in 2018 from its rank of 100 in 2017 among 190 countries. The country had improved by 30 positions from 130 in 2016. It improved its rank in 6 out of 10 indicators with the biggest change in the ‘Construction Permits’ and ‘Trading across Borders’ from 181 in 2017 to 52 in 2018 and 146 in 2017 to 80 in 2018 respectively.

The CNX Nifty ended at 11478.10, down by 34.30 points or 0.30% after trading in a range of 11390.80 and 11508.25. There were 22 stocks advancing against 28 stocks declining on the index. (Provisional)

The top gainers on Nifty were Bharti Airtel up by 5.96%, HCL Tech. up by 3.78%, UPL up by 3.30%, Infosys up by 3.09% and ITC up by 2.61%. (Provisional)

On the flip side, Yes Bank down by 14.97%, Indusind Bank down by 5.96%, SBI down by 3.68%, Cipla down by 3.49% and ICICI Bank down by 3.34% were the top losers. (Provisional)

European markets were trading mostly in green; France’s CAC increased 3.18 points or 0.06% to 5,643.76 and Germany’s DAX increased 6.19 points or 0.05% to 12,387.13, while UK’s FTSE 100 decreased 15.39 points or 0.21% to 7,410.82.

Asian markets ended mostly lower on Monday on account of investors awaiting the cues from central bank meetings, both US Fed and Bank of Japan, later this week. Moreover, tensions revolving around the effects of escalating Sino-US trade war weighed on the sentiments. Japanese shares ended lower following reports that Donald Trump’s administration is deeply thinking about imposing severe new restrictions on investments in China. Further, Chinese shares ended lower on speculations that US may curb Chinese companies' access to its capital markets that may boost the ongoing trade war between these nations. Among the Asian markets, Taiwan markets were closed on account of warning of Typhoon Mitag storm and severe rains in some of its areas.