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15 May 2017
I had
mentioned in Friday’s closing report that Nifty, Sensex were getting
overbought. The major indices of the Indian stock markets were range-bound on
Monday and closed with small gains of around 0.50% over Friday’s close. The
trends of the major indices in the course of Monday’s trading are given in the
table below: The Total
Investment & Insurance Solutions
 |
Major Indices (The Total
Investment & Insurance Solutions)
Positive
domestic macro-economic data and a strong rupee cheered the Indian equity markets
on Monday. Investors' sentiments were buoyed by official data released after
market hours on Friday -- Wholesale Price Index (WPI) and Consumer Price Index
(CPI) -- which showed that inflation eased in April. The data on annual rate of
inflation was calculated on a revised base year of 2011-12. However, India's
factory output growth slowed to 2.7% in March on the back of poor manufacturing
performance in the new Index of Industrial Production (IIP) with revised base
year of 2011-12. The key indices traded with gains of close to half a per cent
each during the mid-afternoon trade session, as buying was witnessed in
banking, metal and healthcare stocks. The Total
Investment & Insurance Solutions
Equity
benchmark indices started off the first day of the week on a firm note tracking
positive macro-economic data. Appreciation of the rupee against the US dollar
also supported the firm opening of the equity markets, according to market
analysts. Most banking stocks traded with firm sentiments lead by Kotak Bank.
Auto, power, oil-gas and cement sector stocks complemented the firmness of the
markets, pointed our market analysts.
In
a survey conducted during March and April 2017, industry chamber Federation of
Indian Chambers of Commerce and Industry (FICCI) predicted India's gross
domestic product (GDP) growth will be around 7.4% for fiscal 2017-18, with a
minimum and maximum level of 7% and 7.6% respectively. Reasoning out the
growth, FICCI's Economic Outlook Survey said: "While agricultural sector
is estimated to clock 3.5% growth in 2017-18; the pick-up in overall GDP growth
will also be supported by an improvement in industry and services sector
growth. The industry and services sector are expected to grow by 6.9% and 8.4%
respectively in 2017-18.” The survey was conducted amongst economists belonging
to the industry, banking and financial services sector and the participants
feel that with the process of re-monetisation almost complete, consumption
activity has witnessed an uptick and will further build up going ahead. Also,
the India Meteorological Department's latest forecast of monsoon arriving on
time and being sufficient provides some reprieve amidst earlier reports of the
El Nino having a dampening effect this year. Overall, macroeconomic trends in
India project a long term bullish trend in the Indian stock markets. The Total Investment & Insurance Solutions
Thousands
of commuters in Tamil Nadu were stranded on Monday as transport workers unions
began an indefinite strike pressing for higher wages. The transport corporation
workers unions began their indefinite strike from Sunday midnight to press for
higher wages and perks to combat rising inflation and price rise. Very few
staff members arrived for duty at the bus depots, resulting in most of the
long-distance inter-state public transport services getting crippled. On
Monday, students who had to appear for an examination at 10 a.m. lamented as
their daily commute took around two hours. Listed corporate entities with
manufacturing facilities in Tamil Nadu are likely to vibrate in line with the
labour and infrastructure problems in the state and show poorer quarterly
corporate earnings. The Total Investment
& Insurance Solutions
Private
sector lender ICICI Bank on Monday said that it has reduced interest rates by
up to 30 basis points (bps) for home loans of up to Rs30 lakh. "With this
reduction, salaried borrowers can avail home loans at among the lowest rates in
the industry. Salaried women borrowers will get home loans at 8.35% and others
at 8.40%," the private sector lender said in a statement. According
to ICICI Bank, customers from economically weaker section (EWS) and low income
group (LIG) can avail the dual benefit of low interest rates and credit linked
subsidy under the Pradhan Mantri Awas Yojana. ICICI Bank shares closed at
Rs302.05, up 1.82% on the BSE.
China's
retail sales, a key indicator of consumption, grew 10.7% year on year in April,
0.2 percentage points slower than the March level, official data showed on
Monday. Total retail sales of consumer goods hit 2.73 trillion yuan ($395.4
billion) last month, Xinhua news agency cited the National Bureau of Statistics
(NBS) as saying. It increased 0.79% month on month. In the first four months,
total retail sales of consumer goods rose 10.2% year on year, 0.2% points
faster than the growth in the first quarter, according to Xing Zhihong, a
spokesperson with the NBS. Consumption activities were relatively stronger in
rural areas, with retail sales expanding 12.6% in April, outpacing urban areas,
where retail sales climbed 10.4% year on year. Online spending was robust. From
January to April, online retail sales surged 32% year on year to 1.92 trillion
yuan. Xing said the April figure indicates continued expansion of domestic
consumer demand, which was partly driven by consumption upgrades and new
business patterns such as online sales. China is trying to shift its economy toward
a growth model driven by consumer spending, innovation and services, while
weaning it off reliance on exports and investment. Chinese stock market
indices are on a long term bullish trend and are important to the Indian stock
markets as they close early in the trading day for our stock markets.
News
from US markets was also not good on Friday amidst negative news on the
political front with the FBI director’s termination from work. According to
Reuters, “The U.S. benchmark S&P 500 stock index and the Dow edged lower as
tepid economic data weighed on banks and worries deepened over Nordstrom Inc
(JWN.N), J.C. Penney (JCP.N) and other department stores after weak earnings
reports. The S&P closed lower and fell for the first week in four as weak
economic data weighed on financial shares.”
The
top gainers and top losers of the major indices are given in the table below:
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Top Gainer (The Total
Investment & Insurance Solutions)
The closing values of the major Asian
indices are given in the table below: The Total Investment & Insurance Solutions
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| Asian Indices (The Total Investment & Insurance Solutions) |
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