Benchmarks trade slightly higher in early deals

Indian equity benchmarks made slightly positive start and are trading tad above neutral lines in early deals on Friday as investors digested weak infrastructure output data and awaited the auto sales numbers for direction. The positive trend in markets supported by gains in Indusind Bank, Tech Mahindra and Tata Steel amid sustained foreign fund inflow. As per the data, foreign institutional investors purchased Rs 1,870.87 crore in the capital market, on Thursday. However, gains remained capped with weak economic data. The output of eight core infrastructure industries contracted by 5.2% in September, the lowest in the decade, indicating the severity of economic slowdown. Besides, India’s fiscal deficit has widened in the first half of the current fiscal year. The fiscal deficit stood at Rs 6.52 lakh crore till September-end 2019, compared to Rs 5.95 lakh crore in the same period of the previous fiscal year. Low revenue collections have become a reason to worry about the fiscal deficit.

On the global front, Asian markets were exhibiting a mixed trend as investors turned cautious amid renewed uncertainty about the possibility of a long-term US-China trade deal. As per the reports, Chinese officials are casting doubts about reaching a comprehensive long-term trade agreement and are concerned about US President Donald Trump's ‘impulsive nature’. The report said Chinese officials have warned in private conversations that they are unwilling to budge on the thorniest issues. Besides, data showing an increase in Japan's unemployment rate in September also dampened investor sentiment. Back home, sugar stocks were in focus with report that India's 2019-20 sugar production should fall to 26.9 million tonnes, 1.3 million tonnes below an August projection, due to unfavorable weather conditions. In scrip specific development, Yes Bank came under pressure ahead of its Q2 results.

The BSE Sensex is currently trading at 40182.49, up by 53.44 points or 0.13% after trading in a range of 40129.20 and 40283.30. 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 0.61%, while Small cap index was up by 0.59%.

The top gaining sectoral indices on the BSE were Realty up by 1.03%, FMCG up by 0.61%, Basic Materials up by 0.56%, Capital Goods up by 0.48% and Power was up by 0.46%, while Oil & Gas down by 0.91%, Energy down by 0.89%, Telecom down by 0.60%, PSU down by 0.44% and IT was down by 0.12% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 3.01%, Tech Mahindra up by 1.73%, Tata Steel up by 1.68%, ITC up by 1.32% and Hero MotoCorp up by 1.28%. On the flip side, Bharti Airtel down by 1.74%, Tata Motors down by 1.46%, TCS down by 1.28%, Reliance Industries down by 0.72% and Tata Motors - DVR down by 0.67% were the top losers.

Meanwhile, the Controller General of Accounts (CGA) in its latest data has showed that India's fiscal deficit reached nearly 93% of the Budget Estimate (BE) at Rs 6.52 lakh crore in the first half (April-September) of the current fiscal year (2019-20). In absolute terms, the fiscal deficit or the gap between expenditure and revenue was Rs 6,51,554 crore as on September 30, 2019. The deficit had stood at 95.3% of the 2018-19 BE in the corresponding month a year ago.

The government has pegged the fiscal deficit for the current financial year at Rs 7.03 lakh crore, aiming to restrict the deficit at 3.3% of the gross domestic product (GDP). Low revenue collections have become a reason to worry about the fiscal deficit. The government has let go of revenues to the tune of Rs 1.45 lakh crore by announcing cuts in corporate tax in September with a view to boosting the faltering economy.

As per the CGA data, revenue receipts of the government during the April-September 2019-20 period rose to 41.6% of the BE compared to 40.1% in the corresponding period last year. In absolute terms, revenue receipts stood at Rs 8,16,467 crore at the end of September. For the entire 2019-20, the revenue receipts have been pegged at Rs 19.62 lakh crore.

Besides, the capital expenditure was 55.5% of the BE as compared to 54.2% in the year-ago period. Total expenditure during April-September stood at Rs 14.88 lakh crore or 53.4% of the BE, same as the corresponding period of the previous financial year. The government has pegged its total expenditure for the financial year 2019-20 at Rs 27.86 lakh crore.

The CNX Nifty is currently trading at 11884.60, up by 7.15 points or 0.06% after trading in a range of 11868.95 and 11918.30. There were 31 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Zee Entertainment up by 5.39%, Bharti Infratel up by 4.16%, Indusind Bank up by 3.22%, Tech Mahindra up by 1.72% and Tata Steel up by 1.60%. On the flip side, Indian Oil Corporation down by 3.68%, Tata Motors down by 1.94%, Coal India down by 1.90%, Bharti Airtel down by 1.60% and BPCL down by 1.47% were the top losers.

Asian markets were trading mixed; Hang Seng increased 113.48 points or 0.42% to 27,020.20, Shanghai Composite gained 21.41 points or 0.73% to 2,950.47, KOSPI rose 9.53 points or 0.46% to 2,093.01 and Taiwan Weighted strengthened 7.72 points or 0.07% to 11,366.43. On the flip side, Straits Times trembled 2.40 points or 0.07% to 3,227.48, Jakarta Composite lost 19.04 points or 0.31% to 6,209.28 and Nikkei 225 was down by 103.15 points or 0.45% to 22,823.89.