Post Session: Quick Review

Indian equity benchmarks ended in green on Friday. After a positive start of the trading day, markets remained higher during the whole trading session, as union Minister Piyush Goyal said the commerce ministry is trying to ease norms for Special Economic Zones (SEZs) and make it simpler for units to exit these areas. The ministry is also looking at ways for partial de-recognition of existing SEZs so that areas which have no more demand can be used for industrial or other purposes. Adding to the optimism, Union Road Transport and Highways Minister Nitin Gadkari said India is becoming a global investment destination and the government is committed to providing a favourable policy framework.

Sentiments remained up-beat with private report stating that with higher consumer confidence following the rise in vaccination levels and sitting on already-built-up-savings through the pandemic months, the top 20 per cent of upper-income consumers will help recover the near-term consumption demand. These consumers account for the bulk of the rural and urban demand. Some solace also came with former deputy chairman of erstwhile Planning Commission Montek Singh Ahluwalia’s statement that the Indian economy has bottomed out and the formal sector is likely to get back to pre-pandemic levels by the end of this year. He is in favor of the National Monetisation Pipeline (NMP) that will look to unlock value in infrastructure assets across sectors ranging from power to road and railways.

In the second half of the trading session, key indices cut some of their gains. Traders got cautious, as the coronavirus disease (COVID-19) pandemic's resurgence in recent months has dampened investor sentiment in emerging East Asia even as accommodative policy stances have kept financial conditions stable, according to the latest issue of the Asian Development Bank's (ADB) Asia Bond Monitor. China, Indonesia, Malaysia, Thailand, and Vietnam posted declines in yields on short-term (2-year) and long-term (10-year) government bonds from June 15 to August 27. Traders were seen taking a note of reports that the finance ministry is scheduled to meet representatives of global ratings agency Moody's next week and pitch for a sovereign rating upgrade as the economy is showing faster-than-expected recovery from the pandemic-induced contraction.

On the global front, European markets were trading lower as worries about troubled property developer China Evergrande and weak German business confidence data prompted investors to book some profit after a mid-week rally. Asian markets settled mostly lower on Friday, after Singapore's industrial production increased at a softer pace in August. The data from the Economic Development Board showed that industrial output grew 11.2 percent year-on-year in August, after a 16.4 percent rise in July. Production was forecast to increase 8.8 percent. Excluding biomedical manufacturing, industrial production gained 13.6 percent yearly in August, following a 6.7 percent rise in the preceding month.

The BSE Sensex ended at 60048.47, up by 163.11 points or 0.27% after trading in a range of 59946.55 and 60333.00. There were 12 stocks advancing against 18 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 1.16%, while Small cap index down by 0.30%. (Provisional)

The top gaining sectoral indices on the BSE were Telecom up by 2.77%, Realty up by 1.69%, TECK up by 1.08%, IT up by 0.85% and Consumer Disc up by 0.44%, while Metal down by 2.31%, Healthcare down by 1.40%, PSU down by 1.33%, Basic Materials down by 1.10% and FMCG down by 1.06% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Asian Paints up by 3.76%, Mahindra & Mahindra up by 2.74%, HCL Tech. up by 2.24%, HDFC Bank up by 1.98% and Bharti Airtel up by 1.79%. On the flip side, Tata Steel down by 3.60%, SBI down by 2.00%, Axis Bank down by 1.85%, ITC down by 1.67% and NTPC down by 1.39% were the top losers. (Provisional)

Meanwhile, highlighting that competition is the life force of markets that creates the best incentives for businesses to increase efficiency, drives their productivity and fuels innovation, Ashok Kumar Gupta, Chairperson, Competition Commission of India (CCI) has said that regulatory oversight should be regularly fine-tuned with changing times to suit the dynamic business environment, especially in the present digital world.

Gupta also said “Despite its all-encompassing benefits, healthy competition may not emerge on its own. Even the most ardent votaries of a market economy recognise that liberalised markets cannot be presumed to be competitive and efficient”.

Besides, Gupta explained that without oversight and necessary intervention, we could witness a chaotic environment, where dominant firms misuse their market power to fence out competition, cartels drive up prices or anti-competitive mergers weaken the competitive structure of markets, resulting in businesses getting affected and consumers being deprived of value for money. He said “The objective of CCI is to bring about market corrections where fair competition is found to be hindered due to anti-competitive conduct”.

The CNX Nifty ended at 17853.20, up by 30.25 points or 0.17% after trading in a range of 17819.40 and 17947.65. There were 21 stocks advancing against 29 stocks declining on the index. (Provisional)

The top gainers on Nifty were Asian Paints up by 3.85%, Mahindra & Mahindra up by 2.77%, Eicher Motors up by 2.59%, HCL Tech. up by 2.25% and HDFC Bank up by 2.01%. On the flip side, Tata Steel down by 3.53%, JSW Steel down by 2.67%, SBI down by 2.01%, Divi's Lab down by 1.99% and Axis Bank down by 1.74% were the top losers. (Provisional)

European markets were trading lower, UK’s FTSE 100 decreased 19.85 points or 0.28% to 7,058.50, France’s CAC decreased 55.98 points or 0.84% to 6,646.00 and Germany’s DAX was down by 98.78 points or 0.63% to 15,545.19.

Asian markets settled mostly lower on Friday on uncertainty over whether property developer China Evergrande Group will pay the interest that was due Thursday on a dollar-denominated bond. Meanwhile, the US central bank (Fed) said it would begin tapering its stimulus programme as soon as November and complete the process by mid-2022. The Fed also signalled interest rate hikes may follow more quickly than expected as its turn from pandemic crisis policies gains momentum. Chinese shares declined amid concerns over a missed bond payment by developer China Evergrande Group, although the Chinese central bank PBoC continued its liquidity infusion to support the country’s financial markets and the economy. However, Japanese shares ended higher tracking positive cues from Wall Street overnight.