Local equities continue choppy trade

Local equity benchmarks continued their choppy trade in morning deals with frontline gauges trading almost flat owing to selling pressure in frontline blue-chip counters. Traders were seen piling positions in Telecom, Healthcare and Metal sector, while selling was witnessed in FMCG, Auto and Consumer Discretionary sector stocks. Market participants remain concern with Economic think-tank NCAER’s report that the country's GDP growth is likely to decline to 4.9 per cent in the second quarter of this fiscal due to sustained slowdown in virtually all the sectors. Adding some woes, India’s merchandise exports contracted by 1.11% in October 2019 as compared to same period of last year, mainly on account of a significant dip in shipments of petroleum, carpet, leather products, rice and tea. Trade deficit, gap between imports and exports, narrowed to $11.01 billion in October from $18.0 billion a year ago. However, downside remain capped with weekly data released by the Reserve Bank which showed that foreign exchange reserves continued their upward march surging $1.710 billion to touch a new high of $447.81 billion in the week to November 8. In the previous week, the reserves surged by $3.515 billion to reach $446.098 billion.

On the global turf, Asian markets were trading mostly in green, as Chinese state media said US and China had ‘constructive talks’ on trade in a high-level phone call that included Vice Premier Liu He, US trade representative Robert Lighthizer and Treasury Secretary Steven Mnuchin. Back home, Finance Minister Nirmala Sitharaman stated that it was too early to say if the slowdown in the economy had bottomed out. Companies are planning new investments after $20 billion worth of corporate tax cuts announced in September.

The BSE Sensex is currently trading at 40346.83, down by 9.86 points or 0.02% after trading in a range of 40303.77 and 40542.40. There were 13 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.36%, while Small cap index was up by 0.19%.

The top gaining sectoral indices on the BSE were Telecom up by 5.52%, Healthcare up by 1.50%, Metal up by 1.08%, Basic Materials up by 0.98% and TECK was up by 0.51%, while FMCG down by 0.44%, Auto down by 0.41%, Consumer Discretionary down by 0.38%, IT down by 0.27% and Consumer Durables was down by 0.02% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 6.41%, Sun Pharma up by 3.37%, Tata Steel up by 2.85%, SBI up by 1.30% and Vedanta was up by 1.16%. On the flip side, Yes Bank down by 2.33%, ONGC down by 1.62%, Asian Paints down by 1.30%, Mahindra & Mahindra down by 1.30% and Hero MotoCorp was down by 1.28% were the top losers.

Meanwhile, in order to increase Micro, Small and Medium Enterprise (MSME) exports and bring down imports by encouraging local production, Union MSME and Road Transport Minister Nitin Gadkari has said the government is working on two policies. Firstly on the industries which are into export business - how to support and increase their export. The leather industry has a total turnover of Rs 1,40,000 crore of which Rs 80,000 crore to Rs 90,000 crore is domestic and around Rs 45,000-50,000 crore is from export.

He said ‘I have suggested them on working on modernisation, upgradation, product designing and how to reduce the cost of production and improve quality, so that our share increases in the international market. We are working on a policy on how to strenghten export business.’ Secondly, the government is working on policy to increase indigenous production of products that are being imported. He said ‘the products that being particularly imported should get manufactured in the country itself. We are in talks with the commerce ministry on these two policies and it is in the final stages.’

To become competitive in international market, Gadkari emphasized on three important factors - reducing capital cost, power cost and logistic cost and these factors have also been discussed while making the new policy. Besides, he mentioned that the MSME sector has 29 per cent contribution in country's growth and 48 per cent of export is done through MSMEs. Similarly, about 10-11 crore jobs have been created in MSMEs.

The CNX Nifty is currently trading at 11902.10, up by 6.65 points or 0.06% after trading in a range of 11884.10 and 11946.20. There were 25 stocks advancing against 25 stocks declining on the index.

The top gainers on Nifty were Bharti Airtel up by 6.51%, Sun Pharma up by 3.29%, BPCL up by 2.85%, Tata Steel up by 2.85% and Grasim Industries was up by 2.73%. On the flip side, Yes Bank down by 2.26%, ONGC down by 1.66%, Mahindra & Mahindra down by 1.40%, Asian Paints down by 1.30% and Hero MotoCorp was down by 1.30% were the top losers.

Asian markets were trading mostly in green, Hang Seng increased 192.97 points or 0.73% to 26,519.63, Nikkei 225 surged 57.31 points or 0.25% to 23,360.63, Taiwan Weighted strengthened 35.64 points or 0.31% to 11,561.24, Shanghai Composite gained 16.78 points or 0.58% to 2,908.12 and Straits Times was up by 9.37 points or 0.29% to 3,248.23.

On the other hand, KOSPI fell 7.26 points or 0.34% to 2,154.92 and Jakarta Composite was down by 16.89 points or 0.28% to 6,111.46.