Domestic stock market advanced, tracking positive global cues, helped by what appeared to be a pause in the ongoing trade skirmish between the US and China, the world’s two biggest economies. The barometer index, the S&P BSE Sensex, rose 161.57 points or 0.48% to 33,788.54, as per the provisional closing data. The Nifty 50 index rose 47.75 points or 0.46% to 10,379.35, as per the provisional closing data.
Global stock markets rose and US index futures bounced on hopes that a full blown trade war between the United States and China could be averted. Shares of public sector oil marketing companies (PSU OMCs) rose across the board. Most IT and pharmaceutical shares declined.
After opening on a dull note, the market moved higher and hit fresh intraday high in morning trade. Indices turned range bound in mid-morning trade. Indices extended intraday gains and hit fresh intraday high in mid-afternoon trade. Indices pared gains in late trade as profit selling emerged at higher levels.
The Sensex rose 219.53 points, or 0.65% at the day’s high of 33846.50 in mid-afternoon trade, its highest intraday level since 15 March 2018. The index fell 48.06 points, or 0.14% at the day’s low of 33,578.91 in early trade. The Nifty rose 66.10 points, or 0.64% at the day’s high of 10,397.70 in mid-afternoon trade, its highest intraday level since 15 March 2018. The index fell 3.10 points, or 0.03% at the day’s low of 10,328.50 in early trade.
Among secondary barometers, the BSE Mid-Cap index provisionally rose 0.16%. The BSE Small-Cap index provisionally rose 0.38%. Both these indices underperformed the Sensex.
The market breadth, indicating the overall health of the market, was strong. On BSE, 1,639 shares rose and 1,085 shares fell. A total of 182 shares were unchanged.
PSU OMCs were in demand. BPCL (up 3.56%), HPCL (up 3.39%) and Indian Oil Corporation (up 2.75%), edged higher.
Cement shares declined. ACC (down 1.02%), Ambuja Cements (down 0.80%) and UltraTech Cement (down 0.62%), edged lower.
Grasim Industries down 0.39%. Grasim has exposure to cement sector through its holding in UltraTech Cement.
State Bank of India was down 0.08% to Rs 259.60. The bank announced that a meeting of executive committee of the central board of the bank is scheduled on 13 April 2018 to examine the status and decide on extension of validity period for raising of ATI capital by way of Basel Ill Compliant debt instruments in single/multiple tranches in domestic/international markets in INR/USD through private placement at appropriate time. The announcement was made during trading hours today, 9 April 2018.
Auto major Tata Motors fell 1.61% to Rs 358 after the company said that sales of its subsidiary Jaguar Land Rover dropped 7.8% to 83,732 units in March 2018 over March 2017. The announcement was made during trading hours today, 9 April 2018.
Jaguar sales dropped 12.7% to 24,300 units. Land Rover sales declined 5.7% to 59,432 units. Jaguar Land Rover reported retail sales of 614,309 vehicles for the financial year ended 31 March 2018, up 1.7% on the prior year. Retail sales for the financial year were up year-on-year in China (19.9%), North America (4.7%) and in Overseas markets (3.4%) but down in the UK (12.8%) and in Europe (5.3%). Felix Brautigam, Chief Commercial Officer, Jaguar Land Rover said that weaker market conditions in the UK and Europe, driven by lack of consumer confidence and lower demand for diesel, are impacting growth. Jaguar Land Rover is the UK’s largest automotive manufacturer, built around two iconic British car brands: Land Rover, the world’s leading manufacturer of premium all wheel-drive vehicles; and Jaguar, one of the world’s premier luxury sports saloon and sports car marques.
Overseas, European shares rose as hopes that a full blown trade war between the United States and China could be averted. Stocks in Asia were trading higher as investors looked past the trade worries that fueled Friday’s declines on Wall Street.
US officials on Sunday, 8 April 2018, reportedly noted that any penalties on Beijing are not imminent and there is ample time to work out a deal and step back from a possible trade war. President Donald Trump said in a tweet Sunday he expects China to lower trade barriers with the US acting reciprocally on taxes.
A bounce in US stock futures also boosted sentiment across Asian markets. Trading in US index futures indicated that the Dow could jump 170 points at the opening bell today, 9 April 2018.
Meanwhile, some media reported that US forces had struck at sites in Syria, presumably in retaliation for an alleged chemical attack on civilians there.
China has tightened restrictions on exports to North Korea of items with potential dual use in weapons of mass destruction and conventional arms. The ban on exports of potential dual-use items, including software, machinery and chemicals, is in line with UN Security Council resolution number 2375. That resolution was passed in September.
US stocks closed sharply lower on Friday, 6 April 2018, led by a selloff in industrials and financials, as investors continued to fret over an escalating China-US trade fight.
The selling pressure followed Federal Reserve Chairman Jerome Powell’s speech in which he backed a patient approach to raising interest rates. The Fed chairman said going slow on rate hikes has also reduced the risk of an unforeseen blow to the economy that might have pushed the economy into recession.
Investors also digested a weaker-than-expected jobs report that showed that wage growth remains tepid. The US economy added just 103,000 new jobs in March. The unemployment rate was unchanged at 4.1%.
