Bourses fail to carry on two-day record-closing streak on Wednesday

Indian equity bourses failed to carry on two-day record-closing streak on Wednesday, with Sensex & Nifty ending lower by around 80 & 20 points, respectively. After a weak start, indices remained under the grip of bears throughout the day, amid a private report that a spike in India's retail inflation in December has raised the chances that the Reserve Bank of India will put rate cuts on hold for some time despite economic growth languishing at more than six-year lows. Adding worries among traders, the bilateral trade between India and China declined by about $3 billion last year while India's trade deficit continues to be high amounting to $56.77 billion as both countries experienced an economic slowdown.

In the last leg of the trade, key indices managed to come off their intraday low points, after the Asian Development Bank’s (ADB) report indicated that sound economic policies and strong institutions have transformed Asia and the Pacific over the past five decades into a center of global dynamism. Developing Asia's share of global gross domestic product (GDP) rose from 4% in 1960 to 24% in 2018. Investors were seen taking a note of a report stating that new FICCI President Sangita Reddy has urged the government not to worry too much about the fiscal deficit and try to pump the economy by increasing investments to arrest slowdown and accelerate growth. 

On the global front, European markets were trading in red, as Romania's industrial production decreased in November, driven by a decline in mining and quarrying. The data from the National Institute of Statistics showed that industrial production fell a seasonally adjusted 0.2 percent month-on-month in November, led by a 1.8 percent drop in the mining and quarrying output. Asian markets ended lower, after the Bank of Japan downgraded the economic view of three out of nine regions. The bank lowered its view on Hokuriku, Tokai, Chugoku regions, while maintained its assessment of other six regions, namely Hokkaido, Tohoku, Kanto-Koshinetsu, Kinki, Shikoku and Kyushu- Okinawa.

Back home, the metal sector stocks ended in positive territory, after credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has said that the latest amendment to the Mines & Minerals (Development & Regulation) Act, 1957 comes as a major relief to the steel industry. Further, stocks related to the reality industry also ended higher, aided with a joint report by Knight Frank-FICCI-Naredco stating that real estate sentiments in the country revived in December quarter and turned optimistic after two quarters on the back of several measures taken by the government and the RBI to boost demand.

Finally, the BSE Sensex lost 79.90 points or 0.19% to 41,872.73, while the CNX Nifty was down by 19.00 points or 0.15% to 12,343.30.

The BSE Sensex touched high and low of 41,969.86 and 41,648.11, respectively and there were 15 stocks advancing against 15 stocks declining.

The broader indices ended in green; the BSE Mid cap index rose 0.66%, while Small cap index was up by 1.04%.

The top gaining sectoral indices on the BSE were Realty up by 1.37%, Consumer Durables up by 1.37%, Auto up by 1.05%, Consumer Disc up by 0.99% and Utilities up by 0.98%, while Bankex down by 0.70%, Telecom down by 0.30%, Energy down by 0.29%, TECK down by 0.20% and IT down by 0.15% were the top losing indices on BSE.

The top gainers on the Sensex were Hero MotoCorp up by 2.58%, Titan up by 1.31%, Maruti Suzuki up by 1.27%, Asian Paints up by 1.14% and Mahindra & Mahindra up by 1.03%. On the flip side, Indusind Bank down by 5.44%, Infosys down by 1.21%, SBI down by 1.13%, Power Grid down by 0.61% and Tech Mahindra down by 0.53% were the top losers.

Meanwhile, with a view to guard domestic players from cheap imports, the government may impose anti-dumping duty on a Chinese medicine used to treat different kind of bacterial infections. The commerce ministry's investigation arm Directorate General of Trade Remedies (DGTR) has conducted a probe into an alleged dumping of Ciprofloxacin Hydrochloride from China following a complaint filed by Aarti Drugs. Aarti Drugs has filed an application before the directorate for investigation into the imports from the neighbouring country, with which India has a huge trade deficit of over $50 billion, for imposing anti-dumping duty.

In a notification, DGTR said that on the basis of the prima facie evidence submitted by the domestic industry about dumping of the product originating in or exported from China, the authority, hereby, initiates an investigation. In the probe, DGTR will determine the existence, degree and effect of any alleged dumping. If it will be established that the dumping has impacted the domestic industry, the directorate would recommend imposition of the duty. The finance ministry will take the final decision to impose the duty.

Ciprofloxacin Hydrochloride is used to treat different types of bacterial infections, including skin infections, bone and joint infections, respiratory or sinus infections, urinary tract infections, and certain types of diarrhea. The period of investigation is April 2018 to June 2019 (15 months). It would also look at the data of 2015-18.

The CNX Nifty traded in a range of 12,355.15 and 12,278.75. There were 26 stocks advancing against 23 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Yes Bank up by 3.50%, Hero MotoCorp up by 2.52%, Tata Motors up by 1.97%, GAIL up by 1.42% and Titan up by 1.33%. On the flip side, Indusind Bank down by 5.58%, Wipro down by 3.50%, SBI down by 1.22%, Infosys down by 1.21% and BPCL down by 1.13% were the top losers.

European markets were trading mostly in red; France’s CAC decreased 2.21 points or 0.04% to 6,038.68 and Germany’s DAX decreased 12.85 points or 0.1% to 13,443.64, while UK’s FTSE 100 increased 14.19 points or 0.19% to 7,636.54.

Asian markets ended mostly lower on Wednesday on concerns over trade tensions lingered ahead of the signing of a phase one trade deal between the United States and China. US Treasury Secretary Steven Mnuchin said that tariffs on Chinese goods will remain in place until the completion of a second phase of a Sino-US trade agreement, even as both sides are expected to sign an interim deal at the White House. US President Donald Trump is slated to sign the Phase One trade deal with Chinese Vice Premier Liu He at the White House on later in the day. Under the Phase One trade deal, China would also buy over $50 billion more in energy supplies and boost purchases of US services by about $35 billion over the same two-year period. Further, the Chinese currency yuan also weakened after the US signaled that tariffs on Chinese imports would continue at least until the upcoming presidential elections, while the People’s Bank of China added $58 billion into the country’s banking system as holiday nears.