Post Session: Quick Review

Monday turned out to be a fabulous day of trade for Indian equity benchmarks, where frontline gauges garnered gains of over a percent, tracking global peers on optimism about US-China trade developments. Sensex ended at record closing high, while Nifty just 30 points away from its all-time high. Markets traded on positive note since the beginning, taking support from data showing that after declining for four consecutive months, investments through participatory notes (P-notes) in the Indian capital market marginally rose to Rs 76,773 crore at the end of October. The markets also drew some comfort with a survey by the National Statistical Office (NSO) showing that urban unemployment rate dropped to the lowest level in four quarters at 9.3 per cent during January-March 2019.  Key indices continued their rally mood to reach at day’s high points in dying hour of trade, as sentiments on the street improved further with Commerce and industry minister Piyush Goyal’s statement that reform momentum towards self-certification, labour laws and environment clearance will boost investment and production. Traders also took note of Union Finance Minister Nirmala Sitharaman’s statement that India did not join the Regional Comprehensive Economic Partnership (RCEP) as the offer was not as much as our aspirations.

On the global front, Asian markets ended mixed on Monday, while European markets were trading in green, after sentiments improved in the markets followed by developments in US- China trade talks. The US and China have expressed willingness to sign an initial trade deal by the year-end. Back home, jewellery sector were in focus as the government is working on an integrated gold policy, which is expected to be released soon. The policy is aimed at promoting growth of the yellow metal industry and exports of jewellery.

The BSE Sensex ended at 40916.38, up by 556.97 points or 1.38% after trading in a range of 40393.90 and 40931.71. There were 29 stocks advancing against 2 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index rose 1.19%, while Small cap index was up by 0.83%. (Provisional)

The top gaining sectoral indices on the BSE were Telecom up by 7.29%, Metal up by 3.12%, Realty up by 2.07%, Basic Materials up by 1.94% and Auto up by 1.90%, while there were no losers on the BSE sectoral front. (Provisional)

The top gainers on the Sensex were Bharti Airtel up by 8.08%, Tata Steel up by 4.95%, Indusind Bank up by 3.50%, Axis Bank up by 3.10% and HDFC up by 2.55%. On the flip side, ONGC down by 2.20% and Yes Bank down by 1.39% were the few losers. (Provisional)

Meanwhile, the share of foreign portfolio investments (FPI) in domestic capital markets through participatory notes (P-notes) has jumped to Rs 76,773 crore at the end of October from Rs 76,611 crore at September-end. Before registering gain in October, investments through P-notes had been declining continuously since June. At the end of August, the Indian capital market saw a total inflow of Rs 79,088 crore through P-notes, a drop from Rs 81,082 crore till July-end. The investment had stood at Rs 81,913 crore at June-end and Rs 82,619 crore at the end of May.

According to the latest data from the Securities and Exchange Board of India (SEBI), the total value of P-note investments in the Indian markets - equity, debt, and derivatives - increased to Rs 76,773 crore at October-end. Of the total investments made till the end of October, Rs 52,753 crore was invested in the equities, Rs 23,316 crore in debt and Rs 704 crore in the derivatives segments. The use of P-notes has been on a decline since 2017 and slumped to a nine-and-a-half year low of Rs 66,587 crore at the end of October last year.

P-notes are issued by registered foreign portfolio investors (FPIs) to overseas investors who wish to be part of the Indian stock market without registering themselves directly after going through a due diligence process. In July 2017, markets regulator SEBI had notified stricter P-notes norms stipulating a fee of $1,000 that will be levied on each instrument to check any misuse for channelising black money. It had also prohibited FPIs from issuing such notes where the underlying asset is a derivative, except those which are used for hedging purposes.

The CNX Nifty ended at 12079.00, up by 164.60 points or 1.38% after trading in a range of 11919.75 and 12084.50. There were 43 stocks advancing against 7 stocks declining on the index. (Provisional)

The top gainers on Nifty were Bharti Airtel up by 8.02%, Bharti Infratel up by 7.37%, Tata Steel up by 5.25%, Hindalco up by 4.47% and Grasim Industries up by 3.69%. (Provisional)

On the flip side, Zee Entertainment down by 5.33%, ONGC down by 2.28%, Yes Bank down by 1.39%, BPCL down by 0.42% and GAIL India down by 0.29% were the top losers. (Provisional)

European markets were trading in green; UK’s FTSE 100 increased 49.25 points or 0.67% to 7,376.06, France’s CAC rose 27.67 points or 0.47% to 5,920.80 and Germany’s DAX was up by 53.92 points or 0.41% to 13,217.80.

Asian markets ended mixed on Monday as positive comments from both the Washington and Beijing renewed hopes of a Sino-US interim trade deal to end their 16-month long tariff dispute, while the dollar dipped after its latest rally on the back of strong US economic data. US President Donald Trump said a long-negotiated trade deal with China is ‘potentially very close’, while Chinese President Xi Jinping said China wants to work toward a phase-one trade agreement with the US to de-escalate their trade war. Further, Hong Kong shares ended higher after pro-democracy candidates recorded a landslide victory in Hong Kong's district council elections.