Weekly Commentary – 4th October 2019

Nifty50 lost steam this week and ended 2.9% below last Friday’s closing. Midcap and Smallcap lost by 4.3% and 4.7% respectively. Amongst sectoral indices, Bank (-7.2%), Media (-7.1%), Realty (-5.2%) were heavy losers, IT (+0.7%) managed to hold above last week’s closing.

Market Updates:

• RBI cuts repo rate by 25 bps – Reserve Bank of India on Friday reduced repo rate by 25 basis points in its fourth bimonthly policy review. The MPC decided to continue with an accommodative stance as long as it is necessary to revive growth, while ensuring that inflation remains within the target. The repo rate now stands at 5.15%, lowest since March 2010.
• GST collection slips below Rs 1 lakh crore mark – Indicating economic weakness, GST collection has dropped below Rs 1 lakh crore mark to Rs 91,916 crore for September. The September collection is believed to be the lowest in nineteen months. The revenue during September, 2019 has declined by 2.67% in comparison to the revenue during September, 2018.
• More reforms in offing, says NITI Aayog CEO – The government will keep the reform momentum going with more such announcements in the future to bring back the economy on a higher growth track, though issues related with productivity efficiency persist, NITI Aayog CEO Amitabh Kant said on Thursday.