The domestic stock market started the new year on a positive note after US President Donald Trump said that Phase 1 of the trade deal with China would be signed on 15 January. Meanwhile, the Indian government's Rs 102 lakh crore infrastructure push to realise $5 trillion GDP goal also boosted sentiment.
The Nifty ended below 12,200 mark. Gains in the HDFC twins and IT major Infosys offset losses in IndusInd Bank, Reliance Industries and Titan Company. Trading activity remained thin amid New Year holiday in major global stock markets.
The barometer index, the BSE Sensex, rose 52.28 points or 0.13% to 41,306.02. The Nifty 50 index rose 21.25 points or 0.17% to 12,189.70.
In the broader market, the S&P BSE Mid-Cap index advanced 0.21% while the BSE Small-Cap index gained 0.64%.
The market breadth was positive. On BSE, 1362 shares advanced while 1062 shares declined. A total of 197 shares were unchanged.
Economy:
The gross Goods and Services Tax (GST) revenue collected in the month of December 2019 is Rs 1,03,184 crore of which Central GST (CGST) is Rs 19,962 crore, State GST (SGST) is Rs 26,792 crore, Integrated GST (IGST) is Rs 48,099 crore (including Rs 21,295 crore collected on imports) and Cess is Rs 8,331 crore (including Rs 847 crore collected on imports). The total number of GSTR 3B Returns filed for the month of November up to 31 December 2019 is 81.21 lakh.
The GST revenues in December 2019 grew 16% over December 2018. The total revenue earned by Central Government and the State Governments after regular settlement in the month of December 2019 is Rs 41,776 crore for CGST and Rs 42,158 crore for the SGST, the Ministry of Finance said in a release on Wednesday.
Finance minister Nirmala Sitharaman on Tuesday unveiled Rs 102 lakh crore of infrastructure projects that will be implemented in the next five years as part of the government's spending push in the infrastructure sector. The projects identified are in sectors such as power, railways, urban irrigation, mobility, education and health.
Meanwhile, India's current account deficit (CAD) shrank sharply in the September quarter to $6.3 billion or 0.9% of the gross domestic product (GDP) from 2% in the preceding quarter and 2.9% in the year-ago quarter. The contraction in the CAD was primarily on account of a lower trade deficit at $38.1 billion as compared with $50 billion a year ago.
India's fiscal deficit hit 114.8% of 2019-20 budget estimate at Rs 8.07 lakh crore at the end of November, according to the data released by the Controller General of Accounts (CGA). The country's fiscal deficit stood at Rs 7.17 lakh crore in the same period of the previous fiscal.
The fiscal deficit rose on the back of higher spending and lower revenue collection. The government has received nearly Rs 10 lakh crore, which is 48.6% of the annual target, while it incurred an expenditure of Rs 18 lakh crore, which is 65.3% of the annual target.
India's eight infrastructure sectors shrank for the fourth straight month in November at 1.5%, though the magnitude of contraction slowed from 5.8% in October. The Eight Core Industries comprise 40.27% of the weight of items included in the Index of Industrial Production (IIP).
Numbers to Track:
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was trading at 71.2925, compared with its previous closing low of 71.36.
In the commodities market, Brent crude for March 2020 settlement was down 64 cents at $66.03 a barrel. The contract fell 67 cents or 1% to settle at $66 a barrel during the previous trading session.
Buzzing Sector:
Power sector stocks were in demand. Reliance Infrastructure (up 4.93%), Jaiprakash Power Ventures (up 4.88%), Reliance Power (up 4.3%), Adani Power (up 3.4%), Power Grid Corporation Of India (up 2.76%), NTPC (up 2.06%), Tata Power (up 1.77%), CESC (up 0.73%) and Torrent Power (up 0.63%) advanced.
The Nifty Auto index fell 0.47% at 8,209.60. The index has fallen 1.39% in two sessions.
Bajaj Auto (down 1.21%), Ashok Leyland (down 0.61%), Hero MotoCorp (down 0.48%), Tata Motors (down 0.38%) and TVS Motor (down 0.12%) declined.
Eicher Motors fell 1.90%. VE Commercial Vehicles, an unlisted subsidiary of Eicher Motors, reported 19.1% decline in total commercial vehicle sales to 5,042 units in December 2019 from 6,236 units in December 2018.
Maruti Suzuki India fell 0.74%. The car major reported 11.5% decline in total auto sales to 1.33 lakh units in December 2019 compared with 1.50 lakh units in November 2018. Total sales, however, rose 3.9% last month compared with 1.28 lakh units in December 2018. Total domestic sales rose 3.5% to 1.25 lakh units while total exports sales jumped 10.2% to 7,561 units in December 2019 over December 2018.
Mahindra & Mahindra (M&M) rose 0.97%. M&M on Wednesday said that its total automotive sales fell 1% to 39,230 units in December 2019, compared with 39,755 units in December 2018. M&M's Farm Equipment Sector sold 17,990 tractors in December 2019, up 3% from 17,404 tractors in December 2018.
Escorts fell 3.70% after total tractor sales fell 10.5% to 4114 units in December 2019 over December 2018. Sequentially, total tractor sales slumped 46.17% last month from 7,642 units in November 2019.
SML Isuzu fell 0.76% after the company said its total sales tumbled 32.8% to 549 units in December 2019 over 817 units in December 2018. Sequentially, total sales rose 5.37% in December 2019 from 521 units in November 2019.
Stocks in spotlight:
HDFC (up 0.84%) and HDFC Bank (up 0.57%) were the top contributors while Indusind Bank (down 1.72%) and Reliance Industries (down 0.29%) were the top drags.
IT major Infosys rose 0.70%. The company will declare Q3 results on 10 January 2019.
Titan Company fell 2.76%. CRISIL upgraded the company's Long Term Rating to CRISIL AAA from CRISIL AA+. Short Term Ratings were reaffirmed at CRISIL A1+. CRISIL maintained a stable outlook with an expectation that the company will improve over the medium term on account of dominant market position in jewellery retail segment, aided by healthy store additions and strong financial profile. In addition, watch segment is expected to witness healthy growth while sustaining the improvement in profitability.
Adani Green Energy hit an upper circuit limit of 5% at Rs 174.80, which is also a record high for the counter. The Adani Group company said its step down subsidiary, Adani Renewable Energy (GJ), has commissioned its 75 MW Wind Power Project having Power Purchase Agreement (PPA) with Maharashtra State Electricity Distribution Company (MSEDCL) at Rs 2.85/kWh for a period of 25 years. Commercial sale of power from the Project to MSEDCL is expected to commence w.e.f. 1 January 2020.
Sterling and Wilson Solar rose 2.96%. The company's promoters Shapoorji Pallonji and Company (SPCL) and Khurshed Daruvala have repaid Rs 1,000 crore they owed to the firm. The promoters now have to clear a balance of Rs 1,644 crore, which they intend to settle in a staggered manner by 30 September 2020.
Yes Bank slipped 0.64% to Rs 46.65. Care Ratings downgraded Yes Bank's infrastructure bonds, lower tier II bonds and Tier II bonds totaling Rs 16,430.60 crore to Care A from CARE A+, and assigned a negative outlook, the bank said on Tuesday.
The ratings agency also downgraded Yes Bank's Rs 3,600 crore additional tier-I bonds to CARE BBB from CARE BBB+, and assigned a negative outlook. It also downgraded Rs 904.10 crore upper tier -II bonds and Rs 82 crore perpetual bonds to CARE A- from CARE A with negative outlook.
CARE Ratings surged 6.55% to Rs 682.20 after the company on Tuesday said the Securities and Exchange Board of India (Sebi) has concluded its adjudication proceedings. Sebi on 26 December 2019 slapped Rs 25 lakh penalty on CARE Ratings pertaining to assigning of rating to various non-convertible debentures (NCDs) of IL&FS (Infrastructure Leasing and Financial Services). CARE said that it was reviewing the adjudication order and considering the appropriate course of action.
Foreign Markets:
Markets in Asia and Europe were closed on account of the New Year holiday. China's central bank on Wednesday announced a decision to cut the reserve requirement ratio (RRR) for financial institutions by 50 basis points from 6 January, to support the development of the real economy.
Wall Street's major indexes edged higher on Tuesday on a renewed rally fuelled by trade optimism. US market remains shut on Wednesday for the New Year holiday.
US President Donald Trump said on Tuesday that Phase 1 of trade deal with China would be signed on 15 January at the White House. Trump tweeted that he would sign the deal with high level representatives of China and that he would later travel to Beijing to begin talks on the next phase.
The Phase 1 deal, struck earlier this month, is expected to reduce tariffs and boost Chinese purchases of American farm, energy and manufactured goods while addressing some disputes over intellectual property.
In US economic news, the October Case-Shiller home price index showed home prices rising by 3.3% in 20 major metropolitan areas across the US, up from a 3.2% rise in September.
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