Markets likely to get positive start on Friday

Indian markets ended volatile session in green territory on Thursday helped by fag-end buying in mainly banking and IT stocks and easing wholesale inflation. Today, the markets are likely to make positive start tracking Asian peers. Traders will be taking encouragement with report that even after the flurry of sops given to various industries after the budget, Union MSME Minister Nitin Gadkari has said the government will create a special financial scheme for 10 industry segments which are import-driven. He said the government has created a scheme to support industries where imports are high by providing special financial assistance. Traders may take note that in a relief to taxpayers, the government extended the due dates for filing GST annual returns for 2017-18 to December 31 and for the financial year 2018-19, to March 31 next year. The dates for filing the reconciliation statement has also been extended accordingly. In another relief, it has also decided to simplify the two GST forms by making various fields of these forms as optional. Market participants may take note of report that the government has so far mopped up Rs 6 lakh crore or less than 50 percent of the total tax collection target of Rs 13.35 lakh crore for the current fiscal. However, there may be some cautiousness with SBI research report stating that surplus rainfall in August and September is likely to keep food and vegetable prices elevated going forward, and retail inflation may average at around 4 per cent in FY20. Meanwhile, in order to streamline the process, markets regulator SEBI has categorized modifications in futures contract specifications pertaining to quality parameters for commodity derivatives. Telecom stocks will be in focus after Bharti Airtel and Vodafone Idea posted record losses in the September quarter, ravaged by an unfavorable Supreme Court verdict on adjusted gross revenues. There will be some reaction in leather industry related stocks with Council for Leather Exports’ (CLE) statement that the ongoing US-China trade war provides huge opportunities to leather exporters to increase their shipments to America. It added that the sector’s exports grew about seven per cent to the US in the past four months.

The US markets ended mostly in red Thursday after Cisco’s dour forecast raised worries of a global economic slowdown and overshadowed strong results from big box retailer Walmart. Asian markets are trading mostly higher on Friday as traders awaited further updates on a partial US-China trade deal.

Back home, reversing their losses, Indian equity bourses ended Thursday’s trading session on higher note. Markets made a flat start of the day, after India’s retail inflation based on Consumer Price Index quickened to 16-month high of 4.62% in October from 3.99% in September 2019, on the back of higher food prices. Volatility witnessed over the street, as Moody's Investors Service cut India's economic growth forecast for current year to 5.6 per cent from 5.8 per cent estimated earlier, saying GDP slowdown is lasting longer than previously expected. It expected economic activity to pick up in 2020 and 2021 to 6.6 per cent and 6.7 per cent, respectively, but the pace to remain lower than in the recent past. However, in the last hours of the trade, key indices staged smart recovery, amid reports that India’s Wholesale price index (WPI) inflation again eased to 0.16% in the month of October 2019 as against 0.33% for the previous month and 5.54% during the corresponding month of the previous year. Investors took some support with SBI report showing that credit growth picked up rapid pace beginning September - jumping by Rs 1.08 lakh crore - mainly helped by housing, NBFC and lately MSME. The report further said the week up to Diwali has shown an increase in currency in circulation of Rs 30,871 crore from the previous week, thereby showing that people have been demanding cash in the festive season. Finally, the BSE Sensex rose 170.42 points or 0.42% to 40,286.48, while the CNX Nifty was up by 31.65 points or 0.27% to 11,872.10.