Domestic indices to make positive start of November month

Indian markets ended lower on Friday dragged by losses in banks, FMCG and auto sectors. Today, the start of November month is likely to be positive tacking gain in Asian markets coupled with hopes of reviving growth in Indian economy. Investors will be eyeing Markit Manufacturing PMI data for October, slated to be declared later in the day. Traders will be taking encouragement as Ficci President Sangita Reddy said India's strategy of dealing with the COVID-19 crisis has paid off and the country's economy is set to bounce back and emerge stronger. She said it was time to take bold actions and push the growth agenda vigorously. Some support will come as Goods and Services Tax (GST) collections in October 2020 were Rs 1.05 lakh crore, making it the first time monthly revenues crossed the Rs 1 lakh crore mark in FY21. Also, foreign portfolio investors (FPIs) turned net buyers in October in Indian markets by putting in Rs 22,033 crore as participant sentiment was driven by resumption of economic activities and robust quarterly corporate results among others. However, there may be some cautiousness with a private report that the pandemic-induced growth contraction and additional spending to support the needy amounting to a little over 2 percent of the economy are likely to push the combined fiscal deficit to 13 percent of GDP this fiscal - nearly double of the past year. Besides, India has reported a daily jump of 46,441 Covid-19 cases, even as the tally has soared to 8,222,231. The country's death toll has mounted to 122,642. Banking stocks are likely to be in focus as the Supreme Court gets ready to hear the loan moratorium case. There will be some buzz in the power stocks with the power ministry data showing that India's power consumption grew 13.38 per cent to 110.94 billion units (BU) in October this year, mainly driven by buoyancy in industrial and commercial activities. Electricity consumption in the country was recorded at 97.84 BU in October 2019. Sugar industry stocks will be in limelight as Food and Commerce Minister Piyush Goyal said the government is currently not considering an extension of sugar export subsidies for the 2020-21 season that commenced this month in view of stable international sugar prices. Meanwhile, Equitas Small Finance Bank will debut on the bourses today. The IPO has garnered a 1.95 times subscription for its 11.58 crore equity shares at the issue price of Rs 33 apiece.

The US markets tumbled on Friday triggered by a selloff in tech heavyweights following their underwhelming business updates, with a record rise in coronavirus cases and nerves over the presidential election adding to a downbeat mood. Asian markets are trading mostly higher on Monday as data showed China’s manufacturing activity grew in October.

Back home, falling for 3rd straight session, Indian equity benchmarks ended Friday’s session with marginal losses, dragged by losses in telecom, auto and banking sectors amid weak global cues. After making cautious start, markets gained momentum to enter into green zone, as traders found some solace with Prime Minister Narendra Modi’s statement that the Indian economy is getting back on track faster than expected as a timely lockdown and various relief measures announced by the government helped address issues faced by all sections of society and all economic sectors due to the COVID-19 pandemic. Some respite also came with report that the Reserve Bank of India will conduct the second Open Market Operations (OMOs) purchase of State Developments Loans (SDLs), aggregating Rs 10,000 crore, on November 5, 2020. However, key gauges erased all their gains and turned negative in late morning session, as some cautiousness came with the government data showed that the growth of eight core infrastructure industries contracted by 0.8 percent in September 2020 as compared to same period of last year, mainly due to decline in production of crude oil, natural gas, refinery products and cement. The production of eight core sectors had contracted 5.1 percent in September 2019. Some anxiety also came as the government's fiscal deficit rose to Rs 9.14 lakh crore, about 114.8 percent of the annual budget estimate, during the first six months of the current financial year, mainly on account of poor revenue realisation. But, benchmarks managed to trim some of their losses in late trade, taking support from Union Minister Nitin Gadkari’s statement that micro, small and medium enterprises (MSMEs) are the backbone of the Indian economy and can help in boosting exports. He said ‘we are giving highest priority for how we can reduce our import and increase our exports’. Finally, the BSE Sensex fell 135.78 points or 0.34% to 39,614.07, while the CNX Nifty was down by 28.40 points or 0.24% to 11,642.40.