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Bourses manage to keep their heads above water in afternoon deals
May-21-2019

Indian equity benchmarks managed to keep their heads above water in afternoon session, on the back of buying by funds and retail investors. Traders were taking support from IHS Markit report stating that India’s economic policy will continue to focus on maintaining strong economic growth and creating jobs for the country’s large and growing population. It added that the government will also focus on the expansion of already announced policies including infrastructure investment, the Goods and Services Tax (GST) rationalisation and financial sector regulations. Traders also took a note of eminent Indian- American economist Arvind Panagariya’s statement that the next Indian government must show strong commitment to fiscal consolidation, consolidate central ministries, go for aggressive privatisation of public sector undertakings and create a new international trade negotiation entity to fast-track the economic growth of the country. However, the markets trimmed most of their gains, as investors remained cautious with report that eminent Indian experts in the US believe that the next Indian government to be formed after the declaration of the election results on May 23 faces crucial foreign policy decisions, particularly in the economic realm.

On the global front, Asian markets were trading mostly in green, as a temporary reprieve in U.S.-China trade tensions provided a breather. Back home, the BSE Sensex is currently trading at 39411.27, up by 58.60 points or 0.15% after trading in a range of 39328.26 and 39571.73. There were 11 stocks advancing against 20 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.23%, while Small cap index was down by 0.10%.

The top gaining sectoral indices on the BSE were Energy up by 0.93%, Realty up by 0.81%, FMCG up by 0.56%, Consumer Durables up by 0.50% and Healthcare was up by 0.09%, while PSU down by 1.43%, Auto down by 1.24%, Oil & Gas down by 1.03%, Metal down by 0.97% and Utilities was down by 0.91% were top the losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 2.18%, HDFC up by 2.06%, Bajaj Finance up by 1.04%, ITC up by 0.75% and Hindustan Unilever was up by 0.74%. On the flip side, Tata Motors down by 5.39%, Tata Motors - DVR down by 5.01%, Tata Steel down by 1.78%, Yes Bank down by 1.57% and Infosys was down by 1.52% were the top losers.

Meanwhile, Ratings agency Crisil in its latest report has said that the specialty chemicals market is expected to grow at a compounded annual growth rate (CAGR) of 12-13 percent over the next five years, with increased focus on improving products, the intensity of specialty chemicals in these end-use domestic markets will rise. It noted that the closure of plants in countries such as EU and China, due to rising environmental anxieties, has opened doors for Indian manufacturers to further invest in the specialty chemicals segment.

According to the report, while India also faces threat from environmental concerns, the threat is limited to smaller players and shall serve as an opportunity for larger players to capture the market. It pointed out that some of the large players have established themselves in global markets like the EU and US and have active export revenue share which will help them seize the opportunity. It added that at the same time, global players are looking to diversify supply risk, thereby improving export opportunities for Indian players.

Ratings agency further stated that prospects of the domestic chemical industry are intrinsically linked with the overall growth in the economy as well the export market. However, it said slowdown in the global economy is likely to hamper the overall growth potential for chemicals. Nevertheless, despite shutdowns in China and lack of capacity additions in other developed countries, India still stands to benefit in the export market. To take full advantage of the export market, it suggested that existing players will have to update their product mix and introduce specialty chemicals in their portfolio and accelerate investments in R&D.

The CNX Nifty is currently trading at 11834.95, up by 6.70 points or 0.06% after trading in a range of 11811.70 and 11883.55. There were 17 stocks advancing against 33 stocks declining on the index.

The top gainers on Nifty were Bharti Infratel up by 3.32%, Dr. Reddys Lab up by 3.03%, Reliance Industries up by 2.19%, Britannia Industries up by 2.07% and HDFC was up by 1.93%. On the flip side, Tata Motors down by 5.57%, BPCL down by 4.90%, Indian Oil Corporation down by 2.47%, Adani Ports &SEZ down by 2.21% and Tata Steel was down by 2.15% were the top losers.

Asian markets were trading mostly in green; Taiwan Weighted strengthened 66.09 points or 0.64% to 10,464.50, Jakarta Composite soared 47.63 points or 0.81% to 5,954.75, Shanghai Composite gained 34.71 points or 1.21% to 2,905.31 and KOSPI was up by 5.54 points or 0.27% to 2,061.25.

On the flip side, Straits Times trembled 17.18 points or 0.54% to 3,188.28, Nikkei 225 slipped 29.28 points or 0.14% to 21,272.45 and Hang Seng decreased 42.68 points or 0.15% to 27,744.93.
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