Barometers bounce back; breadth strong

Key equity barometers firmed up once again in mid-afternoon trade. At 14:20 IST, the barometer index, the S&P BSE Sensex, was up 10.97 points or 0.03% at 35,909.32. The Nifty 50 index was up 3.30 points or 0.03% at 10,793.15.

The indices opened lower, but bounced back in morning trade. The recovery was short lived as indices slipped once again in mid-morning trade. Indices firmed up again in mid-afternoon trade.

Among secondary barometers, the BSE Mid-Cap index was up 0.41%. The BSE Small-Cap index was up 0.78%. Both these indices outperformed the Sensex.

The market breadth, indicating the overall health of the market, was strong. On BSE, 1574 shares rose and 837 shares fell. A total of 149 shares were unchanged.

Overseas, European stocks were trading higher Friday, as market participants closely monitored signs of progress in trade talks between the world's two largest economies.

Asian shares were mixed, following a negative closing in the US stocks after the release of a stream of disappointing global economic data on Thursday. Investors continue to closely watch high-level talks between US and Chinese trade negotiators in Washington, with little more than a week left before a US-imposed deadline for an agreement expires, triggering higher tariffs.

US stocks finished lower Thursday as fresh economic data out of Europe and Japan suggest further slowing in global growth. Concerns about slowing global growth were underscored by the release of surveys from Europe and Japan that showed manufacturing contracting in February, with export-dependent German manufacturers reporting the worst drop in activity in more than six years.

In US, December's durable goods data showed a surprise slowdown in business spending. The Philadelphia Fed manufacturing survey fell to minus 4.1, the first negative number since May 2016 and the biggest drop since August 2011. Markit PMI data also showed manufacturing activity at the slowest pace in 17 months.

Back home, Suzlon Energy surged 21.90% to Rs 5.40.

IT shares were mixed. Hexaware Technologies (up 1.36%), Wipro (up 0.73%), HCL Technologies (up 0.65%), TCS (up 0.61%), MindTree (up 0.50%) and Tech Mahindra (up 0.35%), edged higher. Infosys (down 0.02%), Oracle Financial Services Software (down 0.21%), MphasiS (down 1.45%) and Persistent Systems (down 3.4%), edged lower.

Most power generation stocks advanced. Jaiprakash Power Ventures (up 9.66%), Reliance Infrastructure (up 8.16%), Reliance Power (up 2.23%), GMR Infrastructure (up 1.55%), NTPC (up 1.39%), JSW Energy (up 0.76%), Adani Power (up 0.63%) and CESC (up 0.48%), edged higher. NHPC (down 0.42%), Tata Power (down 0.45%) and Torrent Power (down 0.68%), edged lower.

State-run Coal India was up 0.70%. State-run Power Grid Corporation of India was up 0.08%.

Meanwhile, the Reserve Bank of India (RBI) on Thursday released the minutes of the Monetary Policy Committee's meeting held on February 5-7. Governor Shaktikanta Das has said that the neutral stance of the central bank will provide flexibility and the room to address challenges to sustained growth of the Indian economy over the coming months, as long as the inflation outlook remains benign.

In his statement, Das said that global growth was losing traction amidst lingering trade tensions and uncertainty around Brexit. On the positive side, crude oil prices remain soft, though the benefit for net exports could be restricted due to slowing global demand. GDP growth for 2019-20 is projected at 7.4% - in the range of 7.2-7.4% in H1, and 7.5% in Q3 - with risks evenly balanced.

Das noted that the CPI inflation print of December at 2.2% continued to surprise on the downside. The RBI Governor also believed that the outlook for food inflation was expected to be benign in the backdrop of excess domestic supply conditions in many food items. CPI inflation is projected at below 4% in the remaining four quarters - 2.8% in Q4:2018-19, 3.2-3.4% in H1:2019-20 and 3.9% in Q3:2019-20 - with risks broadly balanced.

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