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Markets take winning streak to seventh day
Mar-19-2019

Extending their winning streak to seventh straight session, Indian equity benchmarks closed the trading session with strong gains on Tuesday. The start of the day was positive, aided by reports that the net direct tax collection figure has crossed the Rs 10 lakh crore mark as on March 16, helped by the fourth and final installment of tax payment. The entire advance tax data from across the country has not come yet. The net direct tax collection during April-January of this fiscal stood at Rs 7.89 lakh crore as against Rs 12 lakh crore targeted for the entire fiscal of 2018-19. However, the trade remained thin for the most part of the session, ahead of the outcome of the 34th GST Council meeting. Traders were cautious with Niti Aayog CEO Amitabh Kant’s statement that India cannot achieve 9-10% Gross Domestic Product (GDP) growth without revolution in the farm sector. He said there is a need to boost investment in the agriculture sector as well as to introduce new technology and market reforms.

However, key indices gained momentum in the last hours of the trade, aided by firm cues from European markets. The market participants got comfort with reports that an RBI-appointed panel sought suggestions from the public on long-term solutions for economic and financial sustainability of MSME sector, including ways to improve credit rating mechanism to help them raise funds at competitive rates. Adding optimism among the investors, ICRA, domestic rating agency, in its latest report said that the information technology (IT) services sector is likely to register a growth of 7-9% in next financial year (FY20) mainly on account of demand for digital solutions. It mentioned that the earlier small-scale proof of concept digital projects has started evolving into enterprise level larger implementations coupled with improvement in discretionary spend supporting future growth.

On the global front, European markets were trading in green, even though UK households' assessment of their financial well-being fell to the lowest level in thirteen months in March. The survey data from the IHS Markit showed that the IHS Markit Household Finance Index, or HFI, fell to 43.3 in March from 43.4 in February, marking the lowest reading since February 2018. However, Asian markets ended mostly in red, as investors remained on sidelines ahead of the US Federal Reserve policy meeting, and policy decisions by some regional central banks.

Back home, realty sector stocks ended higher, as the all-powerful GST Council approved a transition plan for the implementation of new tax structure for housing units. The meeting deliberated on the transition provision and related issues for the implementation of lower GST rates for the real estate sector. Stocks related to the oil & gas industry also gained with data report from the Petroleum Planning and Analysis Cell (PPAC) of the Oil Ministry showing that India's fuel demand rose 3.8% in February as free cooking gas connections spurred LPG consumption while petrol and diesel use continued to rise. Fuel consumption in February totalled 17.41 million tonnes as compared to 16.77 million tonnes in the same month last year.

Finally, the BSE Sensex rose 268.40 points or 0.70% to 38,363.47, while the CNX Nifty was up by 70.20 points or 0.61% to 11,532.40.

The BSE Sensex touched a high and a low of 38,396.06 and 38,078.23, respectively and there were 23 stocks advancing against 08 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index gained 0.52%, while Small cap index was up by 0.37%.

The top gaining sectoral indices on the BSE were Telecom up by 1.75%, Energy up by 1.53%, PSU up by 1.32%, Utilities up by 1.20% and FMCG up by 1.14%, while Capital Goods down by 0.61%, Auto down by 0.61%, Industrials down by 0.20%, Consumer Disc down by 0.11% and Metal down by 0.11% were the top losing indices on BSE.

The top gainers on the Sensex were ITC up by 2.45%, HCL Tech. up by 2.18%, NTPC up by 2.16%, Reliance Industries up by 2.05% and Bharti Airtel up by 1.81%. On the flip side, Hero MotoCorp down by 2.10%, Larsen & Toubro down by 1.60%, Maruti Suzuki down by 1.13%, Bajaj Auto down by 0.77% and Coal India down by 0.47% were the top losers.

Meanwhile, the government has set up an inter-ministerial panel for monitoring, sanctioning and implementation of projects under the Rs 10,000 crore FAME-II programme. This scheme is aimed at incentivising clean mobility. The Project Implementation and Sanctioning Committee will be chaired by the secretary in the Department of Heavy Industries and will have other members including NITI Aayog CEO, Department for Promotion of Industry and Internal Trade secretary, Department of Economic Affairs secretary and secretaries in the power and new and renewable energy ministry, among others.

The panel's terms of reference includes modifying coverage parameters for various components and sub-components of the scheme, reviewing demand incentives annually or earlier based on price and technology trends, modifying limits of fund allocations among different segments and types of vehicles, reviewing the cap for maximum incentive per vehicle, and deciding other scheme parameters for its smooth roll out.

The Rs 10,000 crore programme under the phase-II of Faster Adoption and Manufacturing of Electric Vehicles in India (FAME-II) scheme will be implemented over a period of three years with effect from April 1, 2019. The scheme will have a Rs 1,500-crore outlay in 2019-20; Rs 5,000 crore in 2020-21 and Rs 3,500 crore in 2021-22. It also proposes support for setting up of charging infrastructure whereby about 2,700 charging stations will be set up in metropolitan cities, other million-plus cities, smart cities and cities of hilly states across India.

The CNX Nifty traded in a range of 11,543.85 and 11,451.25. There were 35 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were HCL Tech up by 2.84%, Bharti Infratel up by 2.80%, Infosys up by 2.21%, Reliance Industries up by 2.07% and ITC up by 2.03%. On the flip side, Eicher Motors down by 2.66%, JSW Steel down by 2.29%, Hero MotoCorp down by 2.04%, Larsen & Toubro down by 1.37% and Maruti Suzuki down by 1.35% were the top losers.

All the European markets were trading in green; UK’s FTSE 100 gained 25.95 points or 0.36% to 7,325.14, France’s CAC rose 17.75 points or 0.33% to 5,430.58 and Germany’s DAX was up by 77.26 points or 0.66% to 11,734.32.

Asian markets ended mostly lower on Tuesday as investors awaited US Federal Reserve and other major central banks meetings outcome later in the week. The US Federal Reserve kicks off its two-day monetary policy meeting later in the day, while the Bank of England (BoE) announces its interest-rate decision on Thursday. In Asia, central banks in Indonesia, the Philippines, Taiwan and Thailand all have monetary policy meetings this week. Chinese shares ended lower on profit taking after recent string of gains on hopes for continued government support to boost growth. Further, Japanese shares closed down as the yen firmed up against the dollar ahead of the Fed and BoE meetings this week.

Asian Indices

Last Trade           

Change in Points

Change in %

Shanghai Composite

3,090.98
-5.44
-0.18

Hang Seng

29,466.28
57.27
0.19

Jakarta Composite

6,480.28
-29.17
-0.45

KLSE Composite

1,687.68

-3.26

-0.19

Nikkei 225

21,566.85
-17.65
-0.08

Straits Times

3,220.92
7.96
0.25

KOSPI Composite

2,177.62
-1.87
-0.09

Taiwan Weighted

10,512.32
-0.38
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