Markets to make gap-down opening on Friday

Indian markets ended higher on Thursday after the government announced a Rs 25,000 crore stimulus for the real estate sector. Today, the start of session is likely to be gap-down amid lackluster trade in Asian peers and concerns over economic growth. Traders will be anxious as India’s credit ratings outlook was cut to negative from stable by Moody’s Investors Service on concern the government won’t be able to help stunted economic growth. Moody’s cited a growing debt burden and the government’s struggle to narrow the budget deficit. The rating company affirmed the nation’s foreign issuer rating at Baa2, the second-lowest investment grade score. Also, there will be some cautiousness with the ICRA’s report that the government's Rs 25,000-crore fund to complete about 1,500 stalled affordable and mid-income housing projects is not adequate. Though, traders may take some support later in the day with report that in the last 20 years, the Indian economy has grown from a gross domestic product (GDP) of $476 billion in 2000 to  $2,900 billion today, a growth of 10 percent compounded annual growth rate (CAGR) in nominal terms and about 7.5 percent in real terms. Traders may take note of report that the government may impose a provisional safeguard duty of 25 per cent on imports of single-mode optical fibre, used for signal transmission, based on a Commerce Ministry investigation that found a sudden and significant surge in the imports of the fibre. Meanwhile, the Insurance Regulatory and Development Authority of India (Irdai) has issued draft guidelines on the wellness and preventive features in health insurance products to enhance the scope of services offered. There will be some buzz in the aviation stocks with global airlines body IATA’s statement that India's air traffic increased by just 1.6 per cent in September compared to 4.5 per cent in August this year and it said the pace of growth has slowed significantly throughout 2019 due to weaker economic activity and Jet Airways bankruptcy. Banking stocks will be in focus with the Reserve Bank of India (RBI) data showing that the non-food credit growth in the banking system stood at 8.79% year-on-year (y-o-y) for the fortnight ended November 7, the highest in the last three fortnights, following the lending outreach programmes by public-sector banks (PSBs). There will be some reaction in telecom stocks with report that the communications ministry has started examining whether the Supreme Court's ruling on the definition of telecom revenue may apply to any company that utilizes radio waves and has a telecom license, throwing up the possibility of statutory dues swelling beyond Rs 3 lakh crore.

The US markets ended higher on Thursday after a Chinese official said that Washington and Beijing have discussed rolling back tariffs. However, Asian markets were trading mostly lower on Friday despite positive cues from Wall Street.

Back home, bulls kept tight control over Dalal Street on Thursday, with Sensex & Nifty garnering around 200 & 50 points, respectively. The start of the day was fabulous, as Cabinet cleared the structure of the proposed exclusive alternate investment fund (AIF) for the real estate sector with an initial corpus of Rs 25,000 crore, more inclusive terms and a commitment to continue to provide more budget funds, in addition to the initial Rs 10,000 crore, as & when demand arises. Adding some relief, Petroleum Minister Dharmendra Pradhan said that the government is on track to meet the target of cutting India's oil import dependence by 10 percent by 2020. Key indices erased all of their gains to turn negative in noon deals, after the International Monetary Fund (IMF) stated that the Indian government needs to become more ‘transparent’ on the fiscal numbers as it is a ‘laggard’ among the G20 peers on this front.  However, benchmarks managed to gain traction again during last hours of the trade to settle near their intraday high points, on account of positive cues from the global markets. Market participants took encouragement with Prime Minister Narendra Modi’s statement that India is taking several steps to create an enabling ecosystem for investors. Finally, the BSE Sensex gained 183.96 points or 0.45% to 40,653.74, while the CNX Nifty was up by 46.00 points or 0.38% to 12,012.05.