Post Session: Quick Review

Indian equity benchmarks continued their winning run for the second straight day and ended with gains of over half a percent on Friday, on the back of encouraging earnings posted by some bluechip companies. Domestic bourses made a cautious start and traded with marginal losses, as traders remained pessimistic with private report stating that government's tax revenue shortfall for FY20 is estimated to be at around Rs 2 lakh crore. As per the report, the revenue shortfall from direct tax sources is being pegged at around Rs 1.5 lakh crore to Rs 1.8 lakh crore, while that from indirect sources is estimated to be at around Rs 30,000 crore to Rs 60,000 crore. Shrugging off a weak start, Indian markets gained some momentum in early noon trade, as sentiments turned optimistic with Union Commerce and Industry Minister Piyush Goyal’s statement that the Indian economy is well-poised to take off and the government is committed to ensure economic growth.

Indices extended their gains to reach at fresh intraday high points in late afternoon session, taking support a private report stating that deal activity by private venture investors grew by 28 per cent to $48 billion in 2019, propelled by infrastructure bets, but will slow down to under 20 per cent in 2020. Some support also came with report that the government think-tank Niti Aayog will develop a national data and analytics platform to make all government data accessible to stakeholders in a user-friendly manner. Traders took note of report that the Reserve Bank of India (RBI) has raised the investment limit for FPIs in government and corporate bonds to bring in more foreign funds into the market.

On the global front, Asian markets ended mostly higher on Friday, after the world’s health body called it a little too early to declare a coronavirus outbreak a global emergency. European markets were trading in green after a key monthly business activity report from Germany suggested the euro zone's largest economy may be picking up some steam at the start of 2020. Back home, auto stocks were in focus as Investment Information and Credit Rating Agency (ICRA) said that demand for two-wheelers in the domestic market is likely to remain weak in the near-term on the back of implementation of BS-VI norms and it expects that the new norms will lead to contraction of volume by 8-10 per cent in FY20. Oil & Gas stocks also were in focus as Oil Minister Dharmendra Pradhan said that India will see an investment of over Rs 4 lakh crore in development of gas supply and distribution infrastructure in the next five years as it chases the target of more than doubling the share of the environment-friendly fuel in its energy basket to 15 percent by 2030.

The BSE Sensex ended at 41620.06, up by 233.66 points or 0.56% after trading in a range of 41275.60 and 41697.03. There were 23 stocks advancing against 7 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index rose 0.75%, while Small cap index was up by 0.50%. (Provisional)

The top gaining sectoral indices on the BSE were Capital Goods up by 1.52%, Consumer Durables up by 1.32%, Basic Materials up by 1.01%, Industrials up by 1.00% and Metal up by 0.99%, while Energy down by 0.20%, Oil & Gas down by 0.07% and Healthcare down by 0.04% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Tech Mahindra up by 2.48%, Kotak Mahindra Bank up by 2.38%, Ultratech Cement up by 2.19%, Titan Co up by 2.05% and Larsen & Toubro up by 2.01%. (Provisional)

On the flip side, Power Grid down by 2.04%, Indusind Bank down by 1.25%, Sun Pharma down by 0.59%, Reliance Industries down by 0.39% and TCS down by 0.34% were the top losers. (Provisional)

Meanwhile, the Reserve Bank of India (RBI) in its fourth special open market operation (OMO) auctions has bought Rs 10,000 crore worth of long-term securities and sold Rs 2,950 crore worth of short-term government bonds. Earlier, the RBI had said it will simultaneously purchase and sell government securities under OMO of Rs 10,000 crore each.

In the OMO purchase auction, the RBI received bids worth Rs 26,887 crore for two types of securities -- 7.32 per cent-2024 and 6.45 per cent-2029 -- but accepted only Rs 10,000 crore of bids. For 7.32 per cent-2024, it got 157 bids and accepted 40 bids. The RBI got 147 bids for 6.45 per cent-2029 bonds but accepted 105 bids. The cut-off yield for 7.32 per cent-2024 was 6.408 per cent, while for 6.45 per cent-2029, it was 6.5780 per cent.

The RBI offered to sell two government securities -- 7.80 per cent-2021 and 7.94 per cent-2021 -- through the OMO. It received Rs 35,375 crore of bids but accepted Rs 2,950 crore of bids. In terms of number of bids, the central bank received 85 bids for 7.80 per cent-2021 and 70 bids for 7.94 per cent-2021 but accepted 3 and 7 bids, respectively. The cut-off yield for 7.80 per cent-2021 was 5.6714 per cent and for 7.94 per cent-2021 was 5.7192 per cent.

The CNX Nifty ended at 12249.25, up by 68.90 points or 0.57% after trading in a range of 12149.65 and 12272.15. There were 36 stocks advancing against 14 stocks declining on the index. (Provisional)

The top gainers on Nifty were Yes Bank up by 3.66%, Britannia Industries up by 2.49%, Tech Mahindra up by 2.48%, Kotak Mahindra Bank up by 2.43% and Ultratech Cement up by 2.42%. (Provisional)

On the flip side, Power Grid down by 2.65%, Cipla down by 1.60%, Indusind Bank down by 1.13%, Tata Motors down by 0.82% and Sun Pharma down by 0.50% were the top losers. (Provisional)

European markets were trading in green; UK’s FTSE 100 increased 107.91 points or 1.44% to 7,615.58, France’s CAC rose 83.95 points or 1.41% to 6,055.74 and Germany’s DAX was up by 175.82 points or 1.31% to 13,564.24.

Asian markets ended mostly higher on Friday after the World Health Organization (WHO) announced it was a bit too early to declare the coronavirus a global health emergency. The death toll in China has now risen to 26, while the number of confirmed cases jumped to 830. Multiple cases of the virus have been confirmed in Thailand, Vietnam, South Korea and Japan, while the United States, Taiwan and Singapore have each reported one case. Japanese shares closed higher after the release of macroeconomic data. Japan's inflation accelerated in December but remained well below the 2 percent target, a government report showed. Consumer price inflation increased to 0.8 percent from 0.5 percent a month ago and against forecast of 0.7 percent. While, flash survey results from IHS Markit revealed that Japan's private sector rebounded at the start of 2020, driven by the expansion in services output. The corresponding index rose to 51.1 in January from 48.6 in December. The services PMI advanced to 52.1 from 49.4 a month ago. The factory PMI also climbed in the month but held below 50. Moreover, Hong Kong shares ended slightly higher in a shortened trading session ahead of the Year of the Rat. Meanwhile, markets in China, South Korea and Taiwan were closed for the Lunar New Year holidays.