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Markets likely to make cautious start on Thursday
Nov-21-2019

Indian markets ended higher for second straight day on Wednesday led by gains in index heavyweight Reliance Industries. Today, the markets are likely to make a cautious start amid weak global cues and rise in crude oil prices but slew of measures announced by government in various sectors are likely to support the indices. The government approved amendments proposed to the Toll Operate Transfer (TOT) model for national highways. The Centre approved the Code on Industrial Relations (IR) Bill, 2019 - considered to be the most contentious labour law amendments. Traders will take some encouragement with the Reserve Bank of India’s (RBI) data showing that bank's credit grew by 8.07 percent to Rs 98.47 lakh crore in the fortnight ended November 6. In a similar fortnight last year, the advances have stood at Rs 91.11 lakh crore. Some support may also come with a private report that the Indian economy is expected to start its recovery from the first quarter of 2020. There will be some buzz in the telecom stocks as Finance Minister Nirmala Sitharaman announced that the government has decided to grant a 2-year moratorium for telecom companies to pay their spectrum dues. She said that the committee of secretaries looked into issues in the telecom sector exhaustively. Auto stocks will be in focus with rating agency India Ratings and Research’s statement that the implementation of the BS VI emission norms from April 1, 2020 could create short-term headwinds for the commercial vehicle (CV) segment. Also, there will be some reaction in sugar stocks as industry body ISMA said that India's sugar production declined 64 per cent to 4.85 lakh tonnes till November 15 in the current marketing year that started last month as mills in Maharashtra have not yet begun their operations. PSU stocks will be in limelight as the government given the in-principle approval for disinvestment in select CPSEs.

The US markets ended in red on Wednesday amid report that a so-called phase one trade deal between China and the US may not be completed by the end of 2019. Asian markets are trading lower on Thursday as a fresh row between Washington and Beijing over US bills on Hong Kong could complicate their trade negotiation and delay a phase one deal that investors had initially hoped to be inked by now.

Back home, Indian equity benchmarks garnered strong gains on Wednesday, with Sensex & Nifty ending higher by around 0.45% each. Key indices made a firm start, aided with the Commerce and Industry Minister Piyush Goyal’s statement the government has strengthened several trade remedial measures, with an aim to provide a level-playing field for the domestic industry and protect it from unfair trade practices in a time-bound manner. The street took a note of reports that the government categorically stated that it does not intend to revise its fiscal deficit target of 3.3% of gross domestic product for the current financial year despite slowdown in economic activities. Firm trade persisted over markets during the whole day, amid report that the Centre is planning to set up a dedicated cell for agriculture startups and small entrepreneurs. National Rainfed Area Authority (NRRA) CEO Ashok Dalwai said there are numerous areas where startups can help farmers reduce cost and increase income. However, in the last hours of the trade, some of the gains got pared, with credit rating agency, CARE Ratings’ report that the pace of employment growth in India has slowed down in the past two years, to 3.9 percent in 2017-18 and 2.8 percent in 2018-19 as the core industries have observed virtually, negative growth in hiring. Finally, the BSE Sensex rose 181.94 points or 0.45% to 40,651.64, while the CNX Nifty was up by 59.00 points or 0.49% to 11,999.10.

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