Post Session: Quick Review

Indian equity benchmarks closed flat with a positive bias on Thursday. The start of the day was on a positive note, taking support with Niti Aayog Vice Chairman Rajiv Kumar’s statement that the Indian economy is coming out of the pandemic-induced degrowth and GDP growth will enter the positive territory in the fourth quarter of this fiscal. Adding optimism among traders, ICRA Ratings in its latest report has said that the Indian corporate sector, which gradually returned to normalcy from the second quarter of the current fiscal, is likely to sustain improvement in the third quarter, aided by strong festive demand. 

In a noon deals, markets turned volatile, as the growth of India’s service sector slowed in the month of November, although it remained well above the 50-level that separates growth from contraction, with a further upturn in new work supporting business activity growth and the first rise in employment for nine months. As per the survey report, the seasonally adjusted Nikkei Services Business Activity Index fell to 53.7 in November from 54.1 in October. Further, the Nikkei India Composite PMI Output Index -- which measures both manufacturing and services - eased to 56.3 in November from 58.0 in October.

However, Indian markets managed to remain in green terrain for the most part of the trading session, after Moody's Investors Service has said that conditions will improve for Indian corporates next year as economic activity picks up steam post-lockdown and earnings grow on the back of widespread demand revival across sectors. It added that most companies' earnings will grow as demand starts to recover following a sharp slump, and financially strong companies will maintain good access to funding, but speculative-grade issuers will face challenges.

On the global front, European markets were trading mostly in red. Asian markets ended mostly higher on Thursday, after China's service sector expanded strongly in November amid greater customer demand and a sustained recovery in market conditions after the coronavirus disease outbreak. The survey data from IHS Markit showed that the services Purchasing Managers' Index rose to 57.8 in November from 56.8 in the previous month. The rate of growth was the second fastest since April 2010, exceeded only by that recorded in June 2020. New orders climbed the most since April 2010 as export sales grew for the first time since June. Efforts to expand capacity and rising order volumes led companies to increase their staffing levels for the fourth month in a row.

The BSE Sensex ended at 44632.65, up by 14.61 points or 0.03% after trading in a range of 44551.42 and 44953.01. There were 18 stocks advancing against 12 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.85%, while Small cap index was up by 0.68%. (Provisional)

The top gaining sectoral indices on the BSE were PSU up by 2.79%, Metal up by 2.53%, Utilities up by 2.00%, Oil & Gas up by 1.77% and Power up by 1.64%, while IT down by 0.65%, TECK down by 0.55%, Bankex down by 0.05% and Telecom down by 0.01% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Maruti Suzuki up by 7.45%, ONGC up by 4.54%, Asian Paints up by 4.08%, NTPC up by 4.01% and SBI up by 3.87%. On the flip side, HDFC Bank down by 2.13%, TCS down by 1.48%, Bajaj Auto down by 1.31%, Infosys down by 1.27% and Bharti Airtel down by 1.02% were the top losers. (Provisional)

Meanwhile, the growth of India’s service sector slowed in the month of November, although it remained well above the 50-level that separates growth from contraction, with a further upturn in new work supporting business activity growth and the first rise in employment for nine months.

As per the survey report, the seasonally adjusted Nikkei Services Business Activity Index fell to 53.7 in November from 54.1 in October. Further, the Nikkei India Composite PMI Output Index -- which measures both manufacturing and services - eased to 56.3 in November from 58.0 in October. The report further noted that new business inflows rose for the second straight month and solidly, despite growth easing from October.

The upturn in total new work was driven by the domestic market, with new export orders decreasing sharply again in November. Services firms hired additional workers in November, ending an eight-month sequence of job shedding. However, the rate of employment growth was marginal overall as some companies reported having sufficient staff to cope with current workloads.

On the price front, rates of inflation for input costs and output charges accelerated, both of which outpacing their respective long-run averages. Meanwhile, services firms were confident of a rise in business activity in the coming 12 months. The overall degree of optimism improved to a nine-month high. Positive sentiment was boosted by hopes that a vaccine for COVID-19 will be rolled out.

The CNX Nifty ended at 13133.90, up by 20.15 points or 0.15% after trading in a range of 13107.90 and 13216.60. There were 35 stocks advancing against 15 stocks declining on the index. (Provisional)

The top gainers on Nifty were Maruti Suzuki up by 7.39%, ONGC up by 4.54%, Hindalco up by 4.38%, Asian Paints up by 4.13% and NTPC up by 3.96%. On the flip side, HDFC Bank down by 2.11%, SBI Life Insurance down by 1.99%, TCS down by 1.46%, Bajaj Auto down by 1.31% and Infosys down by 1.27% were the top losers. (Provisional)

European markets were trading mostly in red, France’s CAC decreased 11.80 points or 0.21% to 5,571.21 and Germany’s DAX was down by 22.11 points or 0.17% to 13,291.13. On the flip side, UK’s FTSE 100 was up by 10.32 points or 0.16% to 6,473.71.

Asian markets ended mostly higher on Thursday as investor optimism around the corona virus vaccine after drug-makers Pfizer and BioNTech said they won permission for emergency use of their COVID-19 vaccine in Britain, which would be one of the first countries to begin vaccinating its population against the virus. Further, hopes for further fiscal stimulus in the United States also kept the market sentiment positive. Chinese shares ended lower as investors were remained cautious following Sino-US tensions after the US House of Representatives passed legislation that would increase oversight of Chinese companies on US exchanges. Although data showed the services sector in China continued to expand at a faster rate, pointing to a further recovery of business activity in the wake of the corona virus outbreak. The China Caixin services Purchasing Managers' Index (PMI) rose to 57.8 from October's 56.8.