Equity market gains 1% on easing trade tension, inflation

Mumbai: Sensex and Nifty gained over 1 per cent during the week ended Friday over easing trade tension and expectations of a rate cut by the Reserve Bank of India in its policy meet next month.

Easing retail and wholesale inflation in December has given room for the central bank to go for a cut in the policy rates, thereby boosting investor sentiments.

Investor sentiments globally were upbeat over progress in the US-China trade negotiations, following reports that US officials are considering lifting some tariffs on Chinese products.

However, rise in global crude oil prices and slowdown in China’s economy, in addition to the partial US government shutdown and political uncertainty in the UK over Brexit fiasco, continued to weigh on investor sentiments.

The ongoing corporate result season, analysts said, have been largely in line with the estimates.

Most corporate earnings declared in the last fortnight were from the IT and banking sectors.

“Companies in the IT space reported revenue growth in line with expectations and management commentary, and deal wins were fairly robust despite a lingering worry on the US GDP growth slowdown,” said Shibani Kurian of Kotak Mahindra Asset Management Company.

Kurian added that banks reported higher loan growth and stable margins while booking some marked-to-market gains on their bond portfolio and asset quality trends have been so far stable.

Top sectoral gainers for the week were the oil and gas, IT and realty indices and the losers comprised capital goods, PSU banks, power and pharma sector stocks, said Deepak Jasani of HDFC Securities.

Sun Pharma lost the most, this week, heaviest on Friday — its biggest fall in over two years — after a second whistleblower letter emerged, levelling allegations with regard to corporate governance.

Top gainers, both on BSE and NSE, were Yes Bank, Reliance Industries and Infosys, which gained in a healthy 6-8 per cent range. Tata Consultancy Services and HCL Technologies inched up by 2-3 per cent.

Bharti Airtel lost close to 7 per cent followed by Larsen and Toubro, which ended lower 3.79 per cent. State Bank of India and NTPC declined in the range of 2-3 per cent.

The S&P BSE Sensex gained 376.77 points, or 1.04 per cent, to close at 36,386.61, whereas the Nifty gained 112 points, or 1.04 per cent, to settle at 10,906.95 points.

The Indian rupee continued to depreciate for the second week on the trot, as it weakened by 69 paise to Rs 71.18 against a US dollar from its previous close of 70.49.

Provisional data from BSE since the start of year showed that foreign institutional investors offloaded stocks worth Rs 2,318.76 crore as against domestic investors buying Rs 1,842.31-crore shares.

[source_without_link]IANS[/source_without_link]