Local equities continue to trade in fine fettle

Local equity benchmarks are trading in fine fettle in morning session, with Sensex and Nifty garnering gains of around half a percent. Buoyant Mid-caps and Small-caps also elevated over 0.50% gains on their respective front line stocks. Traders remain optimistic with Prime Minister Narendra Modi’s statement that India is rolling out ‘faceless tax assessment’ system to forestall any discretion or harassment in tax collection. He highlighted major reform initiatives launched by his government in the financial sectors in the last five years. Traders took note of a report that in a significant indication of India’s rising profile, the 10-nation ASEAN appreciated India’s growing role in the Indo-Pacific region as the two sides, with a combined GDP of $5 trillion. However, upside remain capped with Centre for Monitoring Indian Economy’s report which highlighted that India’s unemployment rate rose to 8.5% in October 2019, the highest level since August 2016. Meanwhile, Organisation for Economic Co-operation and Development’s report said that India’s GDP is likely to grow at 6.6% in 2020-24 lower than its 2013-17 average of 7.4% will be more modest in the medium term while the banking sector regains its footing even as China’s GDP growth will continue to slow at 5.6 per cent in the medium term from its 2013-17 average of 7.1%.

On the global front, Asian markets were trading mostly in green, on the back of the latest positive signals around US-China trade negotiations as well as an indication of resilience in the world’s number one economy. Back home, on the sectoral front, Coal industry stocks were in limelight as industry data showed that India’s coal imports increased by 9.3% to 126.91 million tonnes (MT) in the first six months of the ongoing fiscal. The country had imported 116.04 MT of coal in April-September period of FY 2018-19.

The BSE Sensex is currently trading at 40342.17, up by 177.14 points or 0.44% after trading in a range of 40267.30 and 40434.83. There were 21 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.63%, while Small cap index up by 0.78%.

The top gaining sectoral indices on the BSE were Metal up by 3.65%, Basic Materials up by 2.36%, Telecom up by 2.33%, Utilities up by 0.95% and Capital Goods was up by 0.92%, while Consumer Durables down by 0.37%, Auto down by 0.21%, IT down by 0.20%, Consumer Disc down by 0.14%, TECK down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 4.94%, Vedanta up by 4.58%, Yes Bank up by 2.10%, Bajaj Finance up by 1.91% and ICICI Bank was up by 1.72%. On the flip side, Hero MotoCorp down by 1.52%, Infosys down by 0.84%, Bajaj Auto down by 0.64%, Maruti Suzuki down by 0.64% and TCS was down by 0.33% were the top losers.

Meanwhile, the Centre for Monitoring Indian Economy (CMIE) in its latest data has showed that India’s unemployment rate rose to 8.5% in October 2019, the highest level since August 2016. According to data, the urban unemployment rate for October 2019 stood at 8.9%, slightly higher than the rural unemployment rate of 8.3%.

Among States, Tripura and Haryana saw unemployment levels of more than 20% (the highest), while the unemployment was the lowest in Tamil Nadu at 1.1%. Rajasthan saw its unemployment rate double between September and October 2019.

The CMIE’s figures are in line with the findings of the latest Periodic Labour Force Survey, which had estimated an unemployment rate of 6.1% between July 2017 and June 2018, the worst in 45 years. The data also comes on the back of other indicators showing a downturn in the economy, including the core sector output in September posting its worst contraction in at least 14 years. Earlier, August’s industrial output shrank at its fastest rate in more than six years.

The CNX Nifty is currently trading at 11958.75, up by 68.15 points or 0.57% after trading in a range of 11927.60 and 11974.80. There were 35 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were JSW Steel up by 5.51%, Bharti Infratel up by 5.14%, Tata Steel up by 4.86%, Vedanta up by 4.21% and Hindalco was up by 3.66%. On the flip side, Zee Entertainment down by 2.05%, Hero MotoCorp down by 1.60%, Indian Oil Corporation down by 0.98%, Infosys down by 0.77% and Maruti Suzuki was down by 0.74% were the top losers.

Asian markets were trading mostly in green, Hang Seng increased 347.20 points or 1.28% to 27,447.96, Shanghai Composite gained 23.36 points or 0.79% to 2,981.56, Taiwan Weighted strengthened 138.36 points or 1.21% to 11,537.89, KOSPI rose 29.10 points or 1.39% to 2,129.30 and Straits Times was up by 5.83 points or 0.18% to 3,235.26. On the other side, Jakarta Composite was down by 12.48 points or 0.2% to 6,194.71.