Local equities hold on to their early gains

Local equity benchmarks continued to trade with healthy gains in the morning trades, with the Sensex and Nifty gaining more than 150 and 40 points, respectively, led by gains in index heavyweights. Yes Bank, Larsen & Toubro and Vedanta were the prime gainers among heavy-weights, pushing the Sensex 0.40% higher. Barring Telecom, there was buying across all sectoral indices on BSE. Markets took support from the Union Finance Minister Nirmala Sitharaman’s statement that India remains among the fastest growing economies of the world and efforts are being made to make it grow faster. She added that the government was continuously working to bring reforms. Sentiments remain optimistic with a private report that corporate tax rate cut is clearly a positive for India which would move the country up the ladder in terms of attractiveness for foreign direct investment. However, upside remained capped as International Monetary Fund reported that though India has worked on the fundamentals of its economy, there are problems, including the long-term drivers of growth, that need to be addressed.

On the global front, Asian markets were trading mostly in red, as new data showed worse-than-expected economic growth in China. China’s economy expanded at a 6% rate year-over-year, the worst pace of growth since the first quarter of 1992. Back home, Union Finance Minister stated that there has been narrowing of trade differences between India and the US, hoping that the two countries be able to enter into a trade deal soon.

The BSE Sensex is currently trading at 39207.22, up by 155.16 points or 0.40% after trading in a range of 38963.60 and 39218.60. There were 19 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 1.21%, while Small cap index was up by 1.15%.

The top gaining sectoral indices on the BSE were Capital Goods up by 2.14%, Power up by 1.69%, PSU up by 1.62%, Industrials up by 1.42% and Energy was up by 1.27%, while Telecom down by 0.58% was the lone losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 8.02%, Larsen & Toubro up by 2.02%, Vedanta up by 1.92%, Bajaj Finance up by 1.47% and Maruti Suzuki was up by 1.44%. On the flip side, Tata Motors - DVR down by 1.45%, Tata Motors down by 1.30%, Bharti Airtel down by 1.14%, IndusInd Bank down by 1.10% and ICICI Bank was down by 0.60% were the top losers.

Meanwhile, the International Monetary Fund’s (IMF’s) Managing Director Kristalina Georgieva said India has worked on the fundamentals of its economy, but there are problems, such as long-term drivers of growth, that need to be addressed. Georgieva said in the financial sector, especially non-banking institutions, there are steps taken now to consolidate banks. They ought to help resolve some of these issues.

She mentioned ‘in India, what is critically important is to continue with addressing the long-term drivers of growth. Investment in human capital in India is a top priority. It has to continue bringing women in the labour force. It is very important. India has very talented women, but they stay at home’.

Besides, she said there has been a very strong growth in India over the last years and the IMF is projecting reasonably strong growth for the country. However, she added ‘like the rest of the world, India is experiencing a slowdown. So slightly over six per cent is what we expect to see in 2019.’ The IMF had trimmed India's growth forecast by 90 basic points to 6.1%. This is second downward revision in seven months and in total 120 basis points reduction.

The CNX Nifty is currently trading at 11631.15, up by 44.80 points or 0.39% after trading in a range of 11553.15 and 11635.45. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Yes Bank up by 7.91%, Ultratech Cement up by 2.24%, Larsen & Toubro up by 1.98%, Coal India up by 1.76% and Vedanta was up by 1.72%. On the flip side, Zee Entertainment down by 3.23%, Tata Motors down by 2.44%, Eicher Motors down by 1.67%, Bharti Airtel down by 1.21% and IndusInd Bank was down by 1.13% were the top losers.

Asian markets were trading mostly in red, Taiwan Weighted dropped 25.58 points or 0.23% to 11,161.30, Hang Seng decreased 24.64 points or 0.09% to 26,823.85, Shanghai Composite declined 17.57 points or 0.59% to 2,959.76, Straits Times trembled 11.49 points or 0.37% to 3,114.65 and KOSPI was down by 7.47 points or 0.36% to 2,070.47.

On the other side, Jakarta Composite soared 7.96 points or 0.13% to 6,188.97 and Nikkei 225 was up by 78.60 points or 0.35% to 22,530.46.