Weekly Commentary – 1st November 2019

Nift50 had a big bounce back closing 2.7% over last Friday’s closing. Midcap and smallcap gained 4.3% and 3.4% respectively. Amongst sectoral indices, Media (+11.0%), Auto (+5.0%), IT (+3.9%) and Bank (+3.3%) were big gainers. All major sectoral indices gained over last week.

Market Updates:

• Credit growth accelerates in September: SBI Report – According to SBI Ecowrap report, in September, the jump in retail credit at Rs 51,900 crore was nearly double that of August, of which housing loans jumped by 2.6 times from August. 
• Core sector growth contracts   -The growth of eight core infrastructure industries contracted massively by 5.2% in September 2019, as compared to same period of last year, due to a decline in output of coal, crude oil, natural gas, cement, and electricity. It had expanded by 4.3% in September last year.
• India’s fiscal deficit at 93% of Budget Estimate – India’s fiscal deficit reached nearly 93% of the Budget Estimate (BE) at Rs 6.52 lakh crore in H1FY20. Low revenue collections have become a reason to worry about the fiscal deficit. The government has let go of revenues to the tune of Rs 1.45 lakh crore by announcing cuts in corporate tax in September with a view to boost the faltering economy.