Post Session: Quick Review

Indian equity benchmarks ended at record closing highs on Monday. The start of the day was on a strong note, as India Ratings revised its projections for economic contraction to 7.8 per cent for 2020-21 from the earlier expectation of 11.8 per cent due to easing Covid-19 headwinds and better than expected numbers in the second quarter of the current financial year. Adding more optimism, an article on the state of economy in the RBI Bulletin stated that the economy is coming out of the COVID-19 pandemic's deep abyss faster than most of the predictions, and the growth will enter positive zone in the third quarter of the current financial year.

Traders remained positive during trading session, as industry body CII has suggested a graded road map towards competitive import tariffs over three years, with lowest or nil slab between zero to 2.5 per cent for raw materials, highest of 5 to 7.5 per cent for finished goods and 2.5 to 5 per cent for intermediates, as part of its pre-Budget recommendations to the government. The Confederation of Indian Industry (CII) has proposed the road map to encourage domestic manufacturing in alignment with global trade trends that would boost India's export competitiveness as per shifting global value chains in the next three to five years.

Key indices maintained their gaining rally in the second half of the trading session, taking support with Union Commerce and Industry Minister Piyush Goyal’s statement that the focus on 'Vocal for Local' and manufacturing of value-added products in India can create job opportunities for the youth and boost the country's economic growth. Some support also came with the Centre for Economics and Business Research’s (CEBR) report that India, which appears to have been pushed back to being the world's sixth biggest economy in 2020, will again overtake the UK to become the fifth largest in 2025 and race to the third spot by 2030.

On the global front, European markets were trading higher. Asian markets ended mostly higher on Monday, after Malaysia's exports rose sharply in November. The data from the Department of Statistics showed that exports rose 4.3 percent year-on-year to MYR 84.4 billion in November, after a 0.2 percent increase in October. Imports declined 9.0 percent annually to MYR 67.6 billion in November, following a 6.0 percent fall in the previous month. The trade surplus totaled MYR 16.8 billion in November, which was above the expected level of MYR 12.6 billion.

The BSE Sensex ended at 47353.75, up by 380.21 points or 0.81% after trading in a range of 47148.24 and 47406.72. There were 26 stocks advancing against 4 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.83%, while Small cap index was up by 1.49%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 2.65%, Metal up by 2.25%, Consumer Durables up by 2.19%, Industrials up by 1.76% and PSU up by 1.61%, while there were no losing sectoral indices on the BSE. (Provisional)

The top gainers on the Sensex were Titan Co up by 3.15%, SBI up by 3.15%, Larsen & Toubro up by 2.23%, Ultratech Cement up by 1.92% and Indusind Bank up by 1.67%. On the flip side, Hindustan Unilever down by 0.41%, Sun Pharma down by 0.39%, Dr. Reddy’s Lab down by 0.18% and Bajaj Finserv down by 0.07% were the top losers. (Provisional)

Meanwhile, raising some concerns over the recovery of the auto sector, credit rating agency India Ratings and Research (Ind-Ra) in its latest report has said that commercial vehicle sales in India could take longer to recover than expected despite improving macro-economic indicators.

As per the report, the light commercial vehicles (LCVs) segment has started to recover as they provide last mile connectivity and because of increased e-commerce activities but medium and heavy commercial vehicle (MHCV) sales are unlikely to recover before the fourth quarter of 2021-22.

Ind-Ra reiterated that MHCV sales could decline by 35-45 per cent year-on-year (y-o-y) in FY21, though the decline in LCV sales is likely to be contained within 20-25 per cent. The rating agency further said that in FY22, the industry could see sales growth in double digits, especially due to the low base of FY20-FY21.

The CNX Nifty ended at 13873.20, up by 123.95 points or 0.90% after trading in a range of 13811.55 and 13885.30. There were 43 stocks advancing against 6 stocks declining, while 1 stock remains unchanged on the index. (Provisional)

The top gainers on Nifty were Tata Motors up by 5.91%, JSW Steel up by 5.56%, HDFC Life Insurance up by 3.26%, Titan Co up by 3.19% and SBI Life Insurance up by 3.18%. On the flip side, Sun Pharma down by 0.59%, Hindustan Unilever down by 0.56%, Shree Cement down by 0.47%, Britannia down by 0.41% and Cipla down by 0.37% were the top losers. (Provisional)

European markets were trading higher, France’s CAC increased 36.80 points or 0.67% to 5,558.81 and Germany’s DAX was up by 194.52 points or 1.43% to 13,781.75.

Asian markets ended mostly higher on Monday after US President Donald Trump signed a $2.3 trillion corona virus relief and government spending package into law on Sunday. President Trump also restored unemployment benefits to millions of Americans and averted a federal government shutdown. Japanese shares ended higher, despite data showed Japan's industrial output stalled in November from the previous month. Japan confirmed its first case of the new Covid-19 strain in a Tokyo resident who recently returned from Britain. Chinese shares were little changed, driven by strong industrial profit data that underscored a continued recovery in the world's second-largest economy. Though, Hong Kong shares declined after Chinese regulators ordered an Alibaba-affiliate Ant Group to rectify its businesses. While, Alibaba Group boosted its share buyback program to $10 billion from $6 billion.