Markets touch new record closing highs on Monday

Indian equity bourses touched new record closing highs on Monday, with Sensex and Nifty gaining around 0.60% each. After a strong opening, indices remained bullish, as India's factory output growth, measured by the Index of Industrial Production, grew 1.8% in November 2019, mainly on account of improvement in the manufacturing sector. Investors remained in optimistic mood, as the Union minister for micro, small and medium enterprises (MSMEs) Nitin Gadkari said that the Centre is formulating a scheme to encourage import substitute products in the manufacturing sector in order to save foreign exchange.

Firm trade persisted over the Dalal Street throughout the trading session, on account of positive cues from the global markets. Market participants got comfort, amid a report stating that the country's foreign exchange reserves touched a record high of $461.157 billion, after it surged by $3.689 billion in the week to January 3. However, upside remained capped, after the SBI research report stated that the economic slowdown has adversely impacted employment generation in the country as nearly 16 lakh fewer jobs are projected to be created in FY20 compared to 89.7 lakh fresh jobs in FY19.

On the global front, European markets were trading in green, as Ireland's construction sector expanded for the first time in four months in December. The data from the IHS Markit showed that the Ulster Bank construction Purchasing Managers' Index rose to 52.0 in December from 48.2 in November. Asian markets ended mostly higher, after Malaysia's unemployment rate remained stable in November. The data from the Department of Statistics showed that the jobless rate was 3.2 percent in November, the same as seen in October. In the same period last year, the unemployment rate was 3.3 percent.

Back home, minerals sector stocks remained in focus, as the Centre decided to set up an 11-member panel including mines secretaries from various states, to examine issues pertaining to the revision of rates of royalty for minerals. The members of the panel includes mines secretaries from the states like Telangana, Chhattisgarh, Jharkhand, Karnataka, Madhya Pradesh and Odisha. Metal sector stocks ended higher, after Union Minister Dharmendra Pradhan said that steel ministry is planning at an aggregate investment of $70 billion in the eastern region of the country through accelerated development of the sector.

Finally, the BSE Sensex gained 259.97 points or 0.62% to 41,859.69, while the CNX Nifty was up by 72.75 points or 0.59% to 12,329.55.

The BSE Sensex touched high and low of 41,899.63 and 41,720.76, respectively and there were 23 stocks advancing against 07 stocks declining.

The broader indices ended in green; the BSE Mid cap index rose 0.87%, while Small cap index was up by 0.95%.

The top gaining sectoral indices on the BSE were Realty up by 2.12%, IT up by 1.85%, TECK up by 1.81%, Telecom up by 1.75% and FMCG up by 1.21%, while there were no losing sectoral indices on the BSE.

The top gainers on the Sensex were Infosys up by 4.76%, Indusind Bank up by 3.34%, Bharti Airtel up by 2.55%, Hindustan Unilever up by 2.11% and Tata Steel up by 1.85%. On the flip side, TCS down by 1.03%, SBI down by 0.50%, Bajaj Auto down by 0.38%, ICICI Bank down by 0.31% and Reliance Industries down by 0.27% were the top losers.

Meanwhile, amid low consumer sentiments, weak rural demand and economic slowdown, the Society of Indian Automobile Manufacturers (SIAM) in its latest data report has said that the automobile industry recorded its worst-ever sales decline in two decades in 2019, with all vehicle segments reported de-growth last year.

As per the report, overall wholesale of vehicles during the year across categories, including passenger vehicles, two-wheelers and commercial vehicles, fell 13.77 per cent in 2019 at 2,30,73,438 units as against 2,67,58,787 units in 2018. The previous lowest was recorded in 2007 when overall sales had declined by 1.44 per cent.

Segment wise, total passenger vehicle sales during 2019 declined 12.75 per cent to 29,62,052 units as against with 33,94,790 units a year ago, while two-wheeler sales declined 14.19 per cent last year to 1,85,68,280 units as compared with 2,16,40,033 units in 2018. Likewise, total commercial vehicles fell 14.99 per cent to 8,54,759 units as against 10,05,502 units in 2018.

According to SIAM, domestic passenger vehicle sales declined 1.24 per cent to 2,35,786 units in the month of December as compared to 2,38,753 units in the year-ago period. Besides, domestic car sales were also down 8.4 per cent to 1,42,126 units during December 2019 as against 1,55,159 units in December 2018.

The CNX Nifty traded in a range of 12,337.75 and 12,285.80. There were 36 stocks advancing against 14 stocks declining on the index.

The top gainers on Nifty were Infosys up by 4.65%, Indusind Bank up by 3.67%, Coal India up by 3.07%, GAIL India up by 2.91% and Bharti Airtel up by 2.54%. On the flip side, Yes Bank down by 5.92%, UPL down by 1.18%, Bharti Infratel down by 1.18%, TCS down by 0.93% and Eicher Motors down by 0.67% were the top losers.

All European markets were trading higher, UK’s FTSE 100 increased 42.55 points or 0.56% to 7,630.40, France’s CAC increased 18.57 points or 0.31% to 6,055.68 and Germany’s DAX was up by 19.19 points or 0.14% to 13,502.50.

Asian markets ended mostly higher on Monday as investors waiting the signing of a phase-one trade deal between the United States and China in Washington on January 15, 2020. Chinese shares ended higher, with Chinese electric-vehicle makers surging after the government signaled it would not make significant cuts to subsidies for new energy vehicles this year. However, the United States imposed additional sanctions on Iran and rebuffed the Iraqi government's request to begin discussions on pulling out troops. Reports of another rocket attack on an Iraqi airbase also kept investors nervous. US Job growth slowed more than expected in December and wage growth dropped below 3 percent for the first time since July 2018, while the unemployment rate stayed at a 50-year low of 3.5 percent, the Labor Department's monthly report showed. Meanwhile, the Japanese market was closed for the 'Respect for the Aged Day' holiday.