Key barometers tumbled on Friday, dragged by weakness in IT stocks. The barometer index, the BSE Sensex, fell 215.76 points or 0.53% to 40,359.41, as per the provisional closing data. The Nifty 50 index fell 52.20 points or 0.44% to 11,916.20, as per the provisional closing data.
In the broader market, the S&P BSE Mid-Cap index fell 0.14% while the S&P BSE Small-Cap index declined 0.03%.
The market breadth was negative. On the BSE, 1238 shares rose and 1321 shares fell. A total of 192 shares were unchanged. In Nifty 50 index, 21 stocks advanced while 29 stocks declined.
Economy :
India's GDP data for September quarter is scheduled to be published on 29 November 2019. Ratings firm ICRA expects further deterioration in the growth of India's GDP to 4.7% in Q2 of FY2020, due to weakening momentum in the industry.
The Organisation for Economic Co-operation and Development (OECD) on Thursday cut India's economic growth forecast for 2019 to 5.8%, but said it would pick up to 6.2% in 2020 and further to 6.4% in 2021. India's economy grew 6.8% in FY19.
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The World GDP growth is expected to be 2.9% this year - its lowest annual rate since the financial crisis - and remain at 2.9%-3.0% in 2020 and 2021, the OECD said on Thursday in an update of its forecasts. Global GDP expanded 3.5% in 2018.
Trade conflict, weak business investment and persistent political uncertainty are weighing on the world economy and raising the risk of long-term stagnation. Any further escalation of the trade conflict would disrupt supply networks and weigh on confidence, jobs and incomes. Uncertainty about a future EU-UK trade relationship poses a further risk to growth as does the current high level of corporate debt, it added.
Buzzing Index:
The Nifty IT index fell 2.01% to 14,986.85, extending losses for second consecutive session. The index has fallen 2.16% to 14,986.85 from a recent closing high of 15,318.50 on 20 November 2019.
MphasiS (down 3.59%), Infosys (down 3.02%), TCS (down 2.14%), Oracle Financial Services Software (down 2.09%), Hexaware Technologies (down 1.98%), HCL Technologies (down 1.91%), Wipro (down 1.72%), Tech Mahindra (down 1.29%), Persistent Systems (down 1.07%) and MindTree (down 0.27%) declined.
According to media reports, the Department of Homeland Security (DHS) is proposing to revise the definition of specialty occupation to increase focus on obtaining the best and the brightest foreign nationals via the H-1B program.
The changes, proposed under the Fall 2019 Unified Agenda published by the White House Office of Management and Budget on Wednesday, may reportedly see the introduction of additional requirements to ensure employers pay appropriate wages to H-1B visa holders.
A similar set of changes has also been proposed for L-1 visas, used in intra-company transfers. In addition, the DHS has suggested that the ban on the work authorization for spouses of H-1B visa holders should be implemented by March next year.
DHS has proposed a target of December 2019 and September 2020 respectively to publish the rule for the H-1B and L-1 visa changes, reports added.
The move could have an adverse impact on Indian IT companies in the US. US is the biggest outsourcing market for Indian IT firms.
India's External Affairs Minister, S. Jaishankar, reportedly told the Upper House of the Parliament on Thursday that Indians today account for 93% of total number of visas issued under H4 category by US. Trump administration has indicated that it will further review the programme.
Stocks in Spotlight:
State-run Bhel rose 1.17% to Rs 56.05. Crisil downgraded the rating of long-term bank facilities of Bhel to 'AA' from 'AA+' with outlook revised from Negative to Stable due to company's weaker than expected operating performance and the continued decline in net cash levels of the company during the first half fiscal of 2020.
State-run NTPC rose 2.39% to Rs 117.85 after a foreign brokerage house upgraded stocks rating to 'Overweight' from 'Equalweight'. The brokerage house also hiked the price target from Rs 146.7 to Rs 152. Price target was hiked by foreign brokerage on the back of reducing fixed costs under-recovery, potential government stake sale and an attractive risk-reward ratio.
Finolex Cables rose 3.85% at Rs 369.30. The company announced a new range of Electrical Accessories that with fortify company's product offering. The company introduced a range of electrical wire accessories like Door Bell, Extension Box, Spike Guard, Angle Holders, Batten Holders, etc to satisfy the growing demand for quality electrical products.
Network18 Media & Investments surged 12.27% to Rs 31.10. The stock has surged 21.21% in two trading sessions amid media reports that Japan's Sony Corporation is planning to acquire a stake in the media company.
Reliance Industries (RIL) rose 0.61% to Rs 1546.65 after a foreign brokerage house maintained its Buy recommendation on the stock along with raising the target price to Rs 1,700 from Rs 1,565 per share. The broker cited strong operating trends for both telecom and organized retail and added that the spurt in Jio's tariffs will enable the company to enjoy rapid improvements in profitability.
RITES fell 3.38% to Rs 295.50. The government has proposed sale of 2.5 crore equity shares or 10% stake in the company through an offer-for-sale at a floor price for Rs 293.50 per share.
Suven Life Sciences jumped 6.25% to Rs 312.05. The company's chairman & CEO Venkat Jasti told the media that the phase 2 data for SUVN 502, a drug for Alzheimer's disease, will be out in a week. No new drug to treat the mind-robbing disease has been discovered since 2003, Jasti reportedly added.
Ujjivan Financial Services soared 4.19% to Rs 303.30. A foreign broker maintained its neutral rating on the stock while raising its target price to Rs 325 from Rs 260 per share.
Foreign Markets:
Overseas, stocks in Europe and Asia edged higher on Friday. The gains were, however, capped by persistent worries over the status of trade negotiations between China and the United States.
In UK, the main opposition Labour Party launched its election manifesto, featuring a promise to raise taxes on corporations and re-nationalize infrastructure groups.
US stocks closed modestly lower on Thursday after investors digested mixed headlines on the progress of trade.
Against the backdrop of ongoing trade negotiations, tensions between the world's two largest economies have come under strain this week over a U.S. bill supporting Hong Kong protesters, while U.S. Navy warships twice sailed near islands in the South China Sea over the past few days, further angering Beijing.
Media reports said that Chinese Vice Premier Liu He had invited U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin to Beijing for further talks.
China's Ministry of Commerce spokesman Gao Feng said on Thursday that China is willing to work toward an agreement despite reports of pessimism in Beijing over President Donald Trump's refusal to roll back existing tariffs.
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