Market chart beat on a Bloomberg terminal. (Photographer: SeongJoon Cho/Bloomberg)

Weekly Wrap: Sensex, Nifty Decline In First Week Of 2019 On Global Growth Concerns

Indian equity benchmarks declined in the first week of 2019 as concerns over slowing global growth weighed on investor sentiment.

The S&P BSE Sensex fell 1.06 percent to 35,695 and the NSE Nifty 50 Index dropped 1.22 percent to 10,727.

Global growth concerns resurfaced in 2019 after the Chinese manufacturing gauge showed factory conditions slumping in December amid ongoing trade tensions with the U.S.

Apple added to the worries after Chief Executive Officer Tim Cook said sales will be about $84 billion in the quarter ended Dec. 29, down from earlier estimates of $89 billion-$93 billion.

Indian markets saw a selloff on account of slowing global growth, however a silver lining came on Friday after China's central bank cut reserve ratio which helped in capping losses, AK Prabhakar, head of research at IDBI Capital Market, told BloombergQuint over phone.

“Market participants will watch out for populist moves the government might announce for farmers, with reports suggesting that the government will spend up to Rs 2 lakh crore in sops,” Prabhakar said. “If that happens, how the gap will be bridged isn't known and that can cause fear of rating downgrades from S&P and Moody's which can lead to outflows.”

Weekly Wrap: Sensex, Nifty Decline In First Week Of 2019 On Global Growth Concerns

Big Stock Moves Of The Week

  • Eicher Motors was the top Nifty loser of the week. The stock slumped 13 percent, its biggest five-day decline since Oct. 09, to Rs 20,103 after Royal Enfield reported a 13 percent decline in sales on a yearly basis to 58,278 units in December.
  • Mahindra & Mahindra fell nearly 9.7 percent to Rs 725 after it posted 1 percent sales growth from the year-ago month.
  • Jet Airways declined 11.35 percent to Rs 245 after it missed a payment to Indian lenders in the latest sign of mounting strains at the country’s second-largest airline by passengers.
  • Dena Bank declined 16 percent to Rs 14 after a government-approved three-way merger with Bank of Baroda and Vijaya Bank. Dena Bank was valued at a discount of 27 percent to the current market price on Jan. 2.

Also read: Three-Way Merger Swap Ratio Favours Bank Of Baroda, Brokerages Say

Seven of 11 sectoral gauges compiled by National Stock Exchange ended lower led by Nifty Auto Index's 4.5 percent decline after auto companies reported weak sales numbers in December. On the flipside, Nifty PSU Bank Index was top gainer, up 1.5 percent.

The rupee gained for the third week in a row after the greenback declined on weak U.S. manufacturing data.

The local unit rose as much as 0.3 percent or 20 paise to 69.73 against the dollar.

Rupee Among Asian Peers

Weekly Wrap: Sensex, Nifty Decline In First Week Of 2019 On Global Growth Concerns

Big Talking Points This Week

  • Supreme Court revives suit against Nestle for Maggi Noodles.
  • Bank Of Baroda announces swap ratios for merger with Dena Bank, Vijaya Bank.
  • Modi says Urjit Patel wanted to resign six to seven months earlier because of personal reasons.
  • Oil companies will not recoup losses from Re 1 a litre subsidy on petrol, diesel.
  • India remains fastest growing economy ahead of China despite ups and downs.
  • Bharti Airtel adds active users for the first time in four months.
  • Vadilal Group auditor gives qualified view on payments under probe.
  • ICICI Bank reclaims ‘most preferred lender’ tag after four years.
  • India’s Manufacturing PMI in December eases from 11-month high.
  • GST Council to mull 5% tax on under-construction flats in next meeting on Jan. 10.
  • GST collections fall in November.

Don’t forget:

Data To Watch Next Week

  • Jan. 07: India GDP Annual Estimate (YoY) for 2019. Bloomberg estimates at 7.2 percent.
  • Jan. 11: India November Industrial production YoY, prior 8.1 percent.