Post Session: Quick Review

Indian equity benchmarks ended in green terrain on Tuesday. The start of the day was on a positive note, as economic think-tank NCAER, in its mid-year review of the Indian economy, has said that India's Gross Domestic Product (GDP) growth is likely to turn positive at 0.1 per cent in the October-December (Q3) quarter, after witnessing a contraction in the first half of the current financial year. It also forecast 2 per cent growth in the fourth quarter (January-March 2021). It noted that the overall contraction in the current fiscal is likely to be contained at 7.3 per cent.  But soon, key indices turned negative and remained lower in the first half of the trading session, amid cautiousness on renewed fears of a highly infectious new strain of COVID-19.

However, in the last hours of the trading session, markets came back in green terrain to end the day on a higher note, after the Ministry of Finance has released the 8th weekly installment of Rs 6,000 crore to the states. Out of this, an amount of Rs 5,516.60 crore has been released to 23 states and an amount of Rs 483.40 crore has been released to the 3 Union Territories (UT) with Legislative Assembly (Delhi, Jammu & Kashmir & Puducherry) who are members of the GST Council. Adding more relief among traders, rating agency -- Crisil has said corporate profits rose 15 per cent to touch an all-time high in the September quarter as margins widened on softer input costs and better utilistaion levels.

On the global front, European markets were trading higher attempting to recover from a brutal sell-off in the previous session, as investors sentiment was shaken by a new coronavirus strain in the U.K. Asian markets ended lower on Tuesday, even after Taiwan's export orders rose more than expected in November. The data from the Ministry of Economic Affairs showed that export orders grew 29.7 percent year-on-year in November. Orders for electronic products grew 37.8 percent yearly in November and demand for information and communication products gained 39.4 percent. Orders for transport equipment and optical, photogenic, cinematographic apparatus increased by 29.8 percent and 27.8 percent, respectively.

The BSE Sensex ended at 46006.69, up by 452.73 points or 0.99% after trading in a range of 45112.19 and 46080.18. There were 25 stocks advancing against 5 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 1.09%, while Small cap index was up by 0.95%. (Provisional)

The top gaining sectoral indices on the BSE were IT up by 3.37%, TECK up by 3.01%, Utilities up by 2.56%, Telecom up by 1.85% and Metal up by 1.74%, while there were no losing sectoral indices on the BSE. (Provisional)

The top gainers on the Sensex were HCL Tech. up by 5.09%, Tech Mahindra up by 4.33%, Infosys up by 3.78%, Power Grid up by 2.67% and Sun Pharma up by 2.64%. On the flip side, Kotak Mahindra Bank down by 0.94%, Bajaj Finance down by 0.56%, HDFC down by 0.45%, Reliance Industries down by 0.16% and Indusind Bank down by 0.13% were the top losers. (Provisional)

Meanwhile, in order to meet the GST compensation shortfall, the Ministry of Finance has released the 8th weekly installment of Rs 6,000 crore to the states. Out of this, an amount of Rs 5,516.60 crore has been released to 23 states and an amount of Rs 483.40 crore has been released to the 3 Union Territories (UT) with Legislative Assembly (Delhi, Jammu & Kashmir & Puducherry) who are members of the GST Council. The remaining 5 States, Arunachal Pradesh, Manipur, Mizoram, Nagaland and Sikkim do not have a gap in revenue on account of GST implementation.

The amount released this week was the 8th instalment of such funds provided to the States. The amount has been borrowed this week at an interest rate of 4.1902%.  So far, an amount of Rs. 48,000 crore has been borrowed by the Central Government through the special borrowing window at an average interest rate of 4.6986%.

In addition to providing funds through the special borrowing window to meet the shortfall in revenue on account of GST implementation, the Government of India has also granted additional borrowing permission equivalent to 0.50 % of Gross States Domestic Product (GSDP) to the states choosing Option-I to meet GST compensation shortfall to help them in mobilising additional financial resources.

The CNX Nifty ended at 13466.30, up by 137.90 points or 1.03% after trading in a range of 13192.90 and 13492.05. There were 44 stocks advancing against 6 stocks declining on the index. (Provisional)

The top gainers on Nifty were Adani Ports & SEZ up by 5.49%, HCL Tech. up by 4.98%, Tech Mahindra up by 4.17%, Infosys up by 3.67% and GAIL India up by 3.31%. On the flip side, Kotak Mahindra Bank down by 0.93%, Bajaj Finance down by 0.60%, HDFC down by 0.46%, Indusind Bank down by 0.24% and Hindalco down by 0.17% were the top losers. (Provisional)

European markets were trading higher; UK’s FTSE 100 increased 13.27 points or 0.21% to 6,429.59, France’s CAC increased 67.27 points or 1.25% to 5,460.61 and Germany’s DAX was up by 167.21 points or 1.26% to 13,413.51.

Asian markets ended lower on Tuesday as investors concerns over new highly transmissible corona virus strain identified in the United Kingdom dented appetite for riskier assets. The new Covid-19 strain led to a shut-down of much of Britain and set off tighter restrictions in Europe. That overshadowed by $900 billion corona virus relief package from US Congress. Chinese shares closed down on concerns over persisting Sino-US tensions as the United States issued additional visa restrictions on Chinese officials over alleged human rights abuses. Japanese shares declined on profit-taking ahead of year-end holidays.