Post Session: Quick Review

Benchmark indices ended lower for the fourth consecutive session but recovered from the intraday lows in the final hour of trade on Tuesday. Markets traded in negative note since the beginning, following subdued global cues. Sentiments remained dampened with Care Ratings’ report that performance of companies during the quarter ended December of the financial year 2019-20 was weak with contraction in revenue and moderation in the growth rate of net profits. Traders remained pessimistic as International Monetary Fund (IMF) stated that the goods and services tax (GST) collections in India have been below potential. The organisation said that multiple rates along with exemptions and implementation challenges have affected the GST collections.

Markets extended their fall in late-afternoon trade, as the share of foreign portfolio investments (FPI) in domestic capital markets through participatory notes (P-notes) continued to decline and hit a nearly 11-year low of Rs 64,537 crore till the end of December 2019. However, key indices gave up most of their losses to come off their intraday low points, as some optimism remained among the investors with a US-based think tank World Population Review report showing that India emerged as the world's fifth largest economy by overtaking the UK and France in 2019. It added that India is developing into an open-market economy from its previous autarkic policies. Meanwhile, the Commerce and Industry Minister Piyush Goyal has asked the industry to look for ways to expand the country’s export basket by adding more value-added products and cut shipments of raw materials. He said the country’s export basket is changing but it is not changing at fast pace.

On the global front, Asian markets ended mostly lower on Tuesday, after Apple warned the new coronavirus had hit output and demand in China, fuelling fears over the wider impact of the epidemic on corporate earnings and economic growth. European markets were trading in red ahead of a highly watched German survey on Tuesday, which is expected to show a sharp slump in investor confidence and fuel growing pessimism about the outlook for Europe's largest economy. Back home, select Airline stocks ended in green after the latest data released by the Directorate General of Civil Aviation shows domestic airlines flew 1.28 crore passengers in January this year registering a growth of 2.20 percent over the 1.25 crore passengers flown in January 2019.  Steel sector companies also were in focus, as Union Minister Dharmendra Pradhan stated that the impact of Coronavirus outbreak will be felt on global steel industry for at least two to three years, as China is the largest producer of the alloy.

The BSE Sensex ended at 40949.71, down by 105.98 points or 0.26% after trading in a range of 40610.95 and 41042.46. There were 11 stocks advancing against 19 stocks declining on the index. (Provisional)

The broader ended in red; the BSE Mid cap index fell 0.50%, while Small cap index was down by 0.42%. (Provisional)

The top gaining sectoral indices on the BSE were IT up by 0.57%, Oil & Gas up by 0.29%, PSU up by 0.26%, Capital Goods up by 0.19% and Healthcare up by 0.02%, while Telecom down by 4.02%, Metal down by 1.05%, Auto down by 0.95%, Realty down by 0.87% and Basic Materials down by 0.82% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were SBI up by 1.37%, Infosys up by 1.08%, Tech Mahindra up by 0.83%, Power Grid up by 0.71% and TCS up by 0.60%. (Provisional)

On the flip side, Indusind Bank down by 2.96%, Bharti Airtel down by 2.62%, Maruti Suzuki down by 1.68%, Hero MotoCorp down by 1.53% and HCL Tech. down by 1.04% were the top losers.

Meanwhile, a US-based think tank World Population Review in its report has said that India emerged as the world's fifth largest economy by overtaking the UK and France in 2019. It added that India is developing into an open-market economy from its previous autarkic policies. As per the report, India's economy is the fifth largest in the world with a Gross Domestic Product (GDP) of $2.94 trillion, overtaking the UK and France in 2019 to take the fifth spot. The size of the UK economy is $2.83 trillion and that of France is $2.71 trillion.

The report further said that in purchasing power parity (PPP) terms, India's GDP (PPP) is $10.51 trillion, exceeding that of Japan and Germany. Due to India's high population, India's GDP per capita is $2,170 (for comparison, the US is $62,794). However, report mentioned that India's real GDP growth is expected to weaken for the third straight year to 5% from 7.5%.

The report observed that India's economic liberalisation began in the early 1990s and included industrial deregulation, reduced control on foreign trade and investment, and privatisation of state-owned enterprises. These measures have helped India accelerate economic growth. It said India's service sector is the fast-growing sector in the world accounting for 60% of the economy and 28 per of employment, and added that manufacturing and agriculture are two other significant sectors of the economy.

The CNX Nifty ended at 12007.70, down by 38.10 points or 0.32% after trading in a range of 11908.05 and 12030.75. There were 20 stocks advancing against 29 stocks declining on the index. (Provisional)

The top gainers on Nifty were Coal India up by 2.92%, Zee Entertainment up by 2.72%, BPCL up by 2.21%, GAIL India up by 1.44% and Adani Ports &SEZ up by 1.43%. (Provisional)

On the flip side, Bharti Infratel down by 11.32%, Yes Bank down by 6.33%, Tata Motors down by 3.84%, Indusind Bank down by 2.97% and Hindalco down by 2.86% were the top losers. (Provisional)

European markets were trading in red; UK’s FTSE 100 decreased 33.29 points or 0.45% to 7,399.96, France’s CAC fell 33.31 points or 0.55% to 6,052.64 and Germany’s DAX was down by 106.82 points or 0.77% to 13,677.07.

Bears continued to linger over Asian markets with most of the major indices ending in red terrain after Apple warned the new coronavirus had hit output and demand in China, fueling fears over the wider impact of the epidemic on corporate earnings and economic growth. Singapore’s index Straits Times edged lower by over half a percent as investors remained worried on the government’s decision to cut its economic growth forecast for this year as the virus batters the city state’s tourism and trade. However, Chinese benchmark edged higher as investors have taken some comfort from a slowdown in new infections outside hardest-hit Hubei province, which Chinese officials say is a sign that the outbreak is under control. Further, moves by China’s central bank on Monday to cushion the world’s second-largest economy against the health crisis appear to have done little to ease worries.