Post Session: Quick Review

Indian equity benchmarks ended Wednesday’s trade on optimistic note, driven by strong buying sentiment in Realty and Banking stocks. Sensex and Nifty closed above their crucial 40,450 and 11,950 levels, respectively. Markets made a pessimistic start as traders remain concerned with a private report that the government may discontinue spending on 200-odd schemes in order to stick to its fiscal deficit target of 3.3 percent.  However, markets reversed early weakness to trade in positive range in afternoon deals, taking support from Finance Minister Nirmala Sitharaman’s statement that the government is eager to modify rules and boost investment in the infrastructure space. She also said the government is focusing on real estate as part of a broader plan to kick-start economic growth.

Buying got intensified, as sentiments were buoyed with Commerce and Industry Minister Piyush Goyal’s statement that India’s services sector has huge potential to generate job opportunities and push country’s Gross Domestic Product (GDP) growth. He suggested that the ministry, state and industry body Confederation of Indian Industry (CII) can work on some kind of policies and enablers to push the growth of 12 champion sectors being identified by the government. Some support also came in with IT industry body Nasscom’s statement that with the addition of more than 1,300 startups this year so far, India continues to reinforce its position as the third-largest startup ecosystem in the world. But, markets gave up some of their gains in last leg of trade to come off their intraday high points, as Fitch Solutions raised India's fiscal deficit forecast to 3.6 percent of the GDP for this fiscal year, from 3.4 percent previously, due to weak revenue collections resulting from sluggish economic growth and government's sweeping corporate tax rate cut.

On the global front, Asian markets ended mostly higher, as investors awaited further developments in U.S.-China trade talks. However, European markets were trading in red, as a mixed bag of earnings reports and weak services sector data from the eurozone weighed on sentiment. Back home, Sugar stocks were in focus after Indian Sugar Mills Association (ISMA) said total sugar production in the country in the current sugar season would be around 260 lakh tonnes, nearly 20 per cent lower than the 2019-20 season’s 331.61 lakh tonnes.

The BSE Sensex ended at 40464.89, up by 216.66 points or 0.54% after trading in a range of 40037.53 and 40606.91. There were 16 stocks advancing against 15 stocks declining on the index. (Provisional)

The broader indices ended mixed; the BSE Mid cap index rose 0.18%, while Small cap index was down by 0.44%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 2.57%, Bankex up by 1.41%, Metal up by 0.57%, IT up by 0.46% and Industrials up by 0.34%, while Consumer Durables down by 5.48%, Telecom down by 2.60%, Consumer Discretionary Goods & Services down by 0.77%, Energy down by 0.66% and PSU down by 0.37% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were ICICI Bank up by 2.64%, Infosys up by 2.23%, HDFC up by 1.77%, Indusind Bank up by 1.55% and HDFC Bank up by 1.49%. (Provisional)

On the flip side, Bharti Airtel down by 3.27%, ONGC down by 1.40%, Bajaj Finance down by 1.12%, Maruti Suzuki down by 1.06% and Reliance Industries down by 1.06% were the top losers. (Provisional)

Meanwhile, expressing optimism over more reforms for India’s growth, Finance minister Nirmala Sitharaman has said the government will soon use its strong electoral mandate to usher in the next wave of reforms, and not to miss the bus this time. Without naming the reform measures unsuccessfully attempted by the Modi government in its first term, and in an apparent hint at land acquisition reform attempts by NDA1, she said government's efforts last time were thwarted by the poor numbers in the Upper House.

She said ‘i am sure we will now show the commitment for reforms happens fast. That is where the mandate given to Modi 2.0 will help’. She emphasized that ‘we will push forward with those reforms which have missed the bus last time, but won't miss the bus now.’ On whether economics has trumped politics in the recent elections, she it is not possible for any political party, particularly those in power, to delink any subject.

Finance minister said ‘It is not possible for any government, be it at the Centre or in the states, to say give me your vote on nationalism and I do not want to talk about economic issues. Is the voter going to be indulgent enough to say ‘alright, the prime minister doesn't want to talk about economy so we won't talk about the economy’. Hitting out at those who blocked government from carrying out reforms in its first term, she admitted that the numbers were limited (in the Upper House) and the country paid the price for that.

She said the manufacturing sector competitiveness is still pulled down by ‘extraneous’ factors such as high cost for land, electricity and also changes in land use, which are beyond the ambit of individual companies, but which the government now wants to ease them all. She added that everything has a long way to go in terms of becoming actually easy to do business. About companies to committing new investments and using the space created by the corporate tax cut for deleveraging, she said it is fine for a corporate to use the space for the purposes it wishes and exuded confidence that over the long-term, they will invest.

The CNX Nifty ended at 11962.40, up by 45.20 points or 0.38% after trading in a range of 11850.25 and 12002.90. There were 26 stocks advancing against 23 stocks declining on the index. (Provisional)

The top gainers on Nifty were Cipla up by 3.32%, ICICI Bank up by 2.62%, Infosys up by 2.18%, HDFC up by 1.77% and Dr. Reddys Lab up by 1.65%. (Provisional)

On the flip side, Titan Company down by 10.13%, Bharti Airtel down by 3.22%, ONGC down by 1.33%, Maruti Suzuki down by 1.14% and Indian Oil Corp. down by 1.09% were the top losers. (Provisional)

European markets were trading in red; UK’s FTSE 100 decreased 21.72 points or 0.29% to 7,366.36, France’s CAC fell 5.47 points or 0.09% to 5,841.42 and Germany’s DAX was down by 23.52 points or 0.18% to 13,124.98.

Asian markets ended mostly higher on Wednesday. Japanese shares ended higher as the minutes of the Bank of Japan's October monetary policy meeting kept easy money policy on the cards and shrugged off survey data showing that Japan's private sector contracted for the first time in more than three years in October. Though, some gains were capped by cautious trading after reports showed China is pushing US President Donald Trump to remove more tariffs on about $125 billion worth of Chinese goods imposed in September as part of the ‘phase one’ trade deal.