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Bears dominate Dalal Street on Friday
Dec-06-2019

Bears dominated Dalal Street on Friday, with Sensex and Nifty losing over 0.80% each. The start of the day was positive, as Reserve Bank of India’s (RBI) Governor Shaktikanta Das indicated that the government may come up with some countercyclical policy measures on the fiscal side to revive growth. Indices remained in green during early morning deals, taking support with Commerce and Industry Minister Piyush Goyal’s statement the target of Rs 5 lakh crore business through government’s e-marketplace GeM is achievable in less than five years given the huge amount of procurement done via the platform.

However, markets failed to hold gains in noon deals and turned negative to settle in red terrain, impacted with Reserve Bank of India’s consumer confidence survey which highlighted that a further drop in consumer confidence in November as households remained pessimistic about jobs and the general economic situation. Weakness persisted over the street, as Federation of Indian Chambers of Commerce and Industry (FICCI) expressed disappointment at the Reserve Bank of India’s (RBI) decision to keep interest rates unchanged and said there is a need for continued action on the policy rate front to boost growth.

On the global front, European markets were trading in green, even though Germany's industrial production declined unexpectedly in October. The data from Destatis revealed that industrial production decreased 1.7 percent on a monthly basis in October, bigger than the revised 0.6 percent fall logged in September. Asian markets ended in green terrain, despite Japan's leading index fell to the lowest level in nearly ten years in October. The data from the Cabinet Office showed that the leading index, which measures the future economic activity, came in at 91.8 in October, down from 91.9 in September.

Back home, banking stocks ended lower, despite Fitch Ratings said that Indian banks are likely to take significantly more loan write-offs to reduce bad loans against a backdrop of rising provisions and weak recovery prospects. Further, airlines stocks remained in watch, as International Air Transport Association said that India's domestic air passenger volume -- measured in revenue passenger kilometres, increased by 3.6 percent in October 2019 but the expansion was slower as compared to the year-ago period, reflecting the general economic slowdown and disruptive impact of the collapse of Jet Airways earlier in the year.

Finally, the BSE Sensex lost 334.44 points or 0.82% to 40445.15, while the CNX Nifty was down by 96.90 points or 0.81% to 11921.50.

The BSE Sensex touched high and low of 40952.13 and 40337.53, respectively and there were 07 stocks advancing against 24 stocks declining on the index.

The broader indices ended in red; the BSE Mid cap index fell 1.26%, while Small cap index was down by 0.86%.

The lone gaining sectoral index on the BSE was Telecom up by 0.21%, while PSU down by 2.36%, Auto down by 1.78%, Realty down by 1.33%, Utilities down by 1.28% and Power down by 1.16% were the top losing indices on BSE.

The top gainers on the Sensex were Kotak Mahindra Bank up by 1.48%, Tata Steel up by 0.83%, Reliance Industries up by 0.30%, Asian Paints up by 0.17% and Infosys up by 0.07%. On the flip side, Yes Bank down by 9.82%, SBI down by 4.89%, Indusind Bank down by 3.05%, Tata Motors down by 2.77% and Mahindra & Mahindra down by 2.73% were the top losers.

Meanwhile, Commerce and Industry Minister Piyush Goyal has hoped that the target of Rs 5 lakh crore business through Government e-Marketplace (GeM) can be achieved in less than five years given the large number of procurement made through the platform. He also said that GeM symbolizes a transparent and corruption free procurement system and it will unify all government procurement, across all ministries and departments of Union and state governments within a defined timeframe. He added that GeM should take a high jump and be now open to common man, so that they benefit from lower cost of products and services that are available on GeM. 

Considering that GeM is unique in various ways as it does not operate on any algorithms to support/ promote any product or supplier and also does not solicit any business through advertisements, deep discounts, predatory pricing, Goyal said it will help reduce corruption in public procurement in the country. He also said that GeM focusses on giving balanced and fair access to all suppliers in an agnostic manner in market place. He noted that Make in India should be given preference through GeM portal by giving preference to products and services of India.

The minister further stressed to take the GeM portal to the next level wherein all contractors/ sub-contractors of government departments and PSUs should procure from GeM. He warned that the quality of products and services must not be compromised, and stringent mechanisms like blacklisting be put in place against any poor quality product or services. 

The CNX Nifty traded in a range of 12,057.05 and 11,888.85. There were 09 stocks advancing against 41 stocks declining on the index.

The top gainers on Nifty were Bharti Infratel up by 5.26%, Kotak Mahindra Bank up by 1.63%, JSW Steel up by 0.74%, Tata Steel up by 0.54% and Dr. Reddy’s Lab up by 0.33%. On the flip side, Yes Bank down by 10.47%, SBI down by 5.35%, Zee Entertainment down by 4.62%, Indusind Bank down by 3.38% and GAIL India down by 3.34% were the top losers.

European markets were trading in green; UK’s FTSE 100 increased 55.74 points or 0.78% to 7,193.59, France’s CAC rose 31.15 points or 0.54% to 5,832.70 and Germany’s DAX was up by 33.19 points or 0.25% to 13,087.99.

Asian markets ended higher on Friday, supported by continued hopes for a Sino-US ‘phase 1’ agreement before a closely watched date of December 15, when additional tariffs on Chinese exports to the US go into effect. Investors awaited the release of the US government’s monthly nonfarm payrolls report in the day ahead. Chinese shares closed up, with signs of economic recovery and hopes of a trade deal with the United States helping underpin investor sentiment. Japanese shares ended higher despite the yen benefiting from reviving safe-haven demand on the back of uncertainty over a potential phase 1 Sino-US trade deal. However, data released on Friday showed October household expenditure in Japan dropping 5.1% year-on-year in real terms, following a sales tax hike that took place in that month.

Asian Indices

Last Trade           

Change in Points

Change in %

Shanghai Composite

2,912.01
12.54
0.43

Hang Seng

26,498.37

281.33
1.07

Jakarta Composite

6,186.87
34.75
0.56

KLSE Composite

1,565.57

1.99

0.13

Nikkei 225

23,354.40
54.31
0.23

Straits Times

3,194.71
20.52
0.65

KOSPI Composite

2,081.85
21.11
1.02

Taiwan Weighted

11,609.64
14.99
0.13
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