Markets pare gains to come off day’s high points

Indian equity bourses pared their gains in late afternoon session to come off their intraday high points, on account of weak cues from European markets. Upward momentum got hit, after India Ratings and Research’s (Ind-Ra) analysis of data of Annual Survey of Industries (ASI) indicated slowdown in labour productivity growth in the Indian organized manufacturing sector, which grew at an average annual rate of 3.7% during FY16-FY18 (FY11-FY15: 7.4%, FY06-FY10: 10.3%, FY01-FY05: 9.6%), however, it fell to 2.6% and 2.9% in FY17 and FY18, respectively. But, indices managed to keep their heads in green terrain, amid reports that India and China are projected to see accelerated economic growth in the fourth quarter of this year, bucking trends in the US and the European Union.

On the global front, European markets were trading in red, as Turkey's trade deficit in September widened amid a rise in both exports and imports. The data from the Turkish Statistical Institute showed that the trade deficit rose to $2.056 billion in September from $1.929 billion in the same month last year. However, Asian markets were trading in green. Back home, tyre and rubber industry stocks were in watch, after the Government of India has started a probe into alleged exports subsidization on a particular kind of rubber by South Korea, which is impacting the domestic industry. 

The BSE Sensex is currently trading at 40211.10, up by 159.23 points or 0.40% after trading in a range of 40178.25 and 40392.22. There were 17 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.90%, while Small cap index was up by 0.85%.

The top gaining sectoral indices on the BSE were TECK up by 1.83%, PSU up by 1.77%, IT up by 1.70%, Realty up by 1.28% and Telecom up by 1.26%, while Metal down by 0.63%, Energy down by 0.53%, Capital Goods down by 0.21% and FMCG down by 0.15% were the top losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 29.49%, SBI up by 7.62%, Infosys up by 3.88%, Indusind Bank up by 2.55% and NTPC up by 2.48%. On the flip side, Tech Mahindra down by 2.17%, Mahindra & Mahindra down by 1.75%, Tata Steel down by 1.71%, Axis Bank down by 1.15% and ICICI Bank down by 1.02% were the top losers.

Meanwhile, indicating slowdown in labour productivity growth in Indian organized manufacturing sector, credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has said that labour productivity is the most powerful engine of driving and sustaining manufacturing growth, and making the sector globally competitive.

Ind-Ra further noted that longer and sustainable labour productivity growth is dependent on investments in innovation, knowledge, and intangible capital by businesses, and governments’ commitments towards structural reforms and therefore, it believes a lot needs to be done quickly both on the policy front as well as companies’ level.

As per the report, labour productivity in Indian organised manufacturing sector grew at an average annual rate of 3.7% during FY16-FY18 (FY11-FY15: 7.4%, FY06-FY10: 10.3%, FY01-FY05: 9.6%). However, it fell to 2.6% and 2.9% in FY17 and FY18, respectively. During the high growth phase of FY04-FY08, labour productivity grew 14.2%.

The CNX Nifty is currently trading at 11884.40, up by 40.30 points or 0.34% after trading in a range of 11883.05 and 11945.00. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Yes Bank up by 27.55%, Zee Entertainment up by 9.61%, SBI up by 7.31%, Grasim Industries up by 4.22% and Infosys up by 4.00%. On the flip side, JSW Steel down by 2.05%, Tech Mahindra down by 2.05%, Tata Steel down by 1.92%, Mahindra & Mahindra down by 1.67% and ICICI Bank down by 1.40% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 191.94 points or 0.72% to 26,859.65, Nikkei 225 surged 83.92 points or 0.37% to 22,927.04, Straits Times advanced 20.94 points or 0.65% to 3,228.86 and KOSPI rose 3.21 points or 0.15% to 2,083.48. On the flip side, Shanghai Composite declined 9.75 points or 0.33% to 2,929.57, Taiwan Weighted dropped 21.57 points or 0.19% to 11,358.71 and Jakarta Composite lost 35.80 points or 0.57% to 6,259.95.

All European markets were trading in red; FTSE lost 38.96 points or 0.53% to 7,291.82, CAC fell 17.18 points or 0.30% to 5,748.69 and DAX was down by 43.98 points or 0.34% to 12,866.25.