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April Index of Industrial Production: 4.9 per cent on manufacturing

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Industrial production expanded by 4.9 per cent in April on improved performance by manufacturing and mining sectors as also a robust offtake of capital goods.

The industrial growth, based on Index of Industrial Production (IIP), was 3.2 per cent in April last year.

The IIP for March this year has been revised upwards to 4.6 per cent from 4.4 per cent estimated earlier.

As per the data released by the Central Statistics Office (CSO), the manufacturing sector which accounts for over 77 per cent weight of the index, recorded a growth of 5.2 per cent in April this year, up from 2.9 per cent a year ago.

Similarly, the mining output grew by 5.1 per cent, compared to 3 per cent in the year-ago period.

As per the ‘use based’ classification, capital goods out, a barometer of investment, expanded by 13 per cent in April this year as against a decline of 4.8 per cent in the year-ago month.

Consumer durable, as well as consumer non-durable segments too, posted higher growth on yearly basis.

“While the rise in consumer non-durable points the revival in the rural sector, the increase in consumer durable posted a positive outlook for the urban centres,” said D S Rawat, secretary general of industry body Assocham.

According to him, the rise in output of the capital goods sector is indicative of the improvement in investment demand.

In terms of industries, 16 out of 23 groups in the manufacturing sector have shown positive growth in April this year on yearly basis.

The industry group ‘manufacture of computer, electronic and optical products’ has shown the highest positive growth of 27.5 per cent followed by 21.9 per cent in ‘manufacture of motor vehicles, trailers and semi-trailers’ and 15.7 per cent in ‘manufacture of food products’.

On the other hand, the industry group ‘other manufacturing’ has shown the highest negative growth of 30.7 per cent followed by 13.4 per cent in ‘manufacture of wearing apparel’ and 10.3 per cent in ‘printing and reproduction of recorded media’, CSO data said.

The CSO data also revealed that infrastructure/ construction goods recorded a growth of 7.5 per cent, up from 4.7 per cent in the year-ago period.

Aditi Nayar, Principal Economist at ICRA said the positive impact of the sharp uptick in growth of coal output on primary goods was offset by the 14-month low performance of electricity.

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Sensex rises over 250 pts, Nifty reclaims 11,400 mark

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Sensex

Mumbai | The benchmark Sensex staged a strong comeback in early trade today gaining over 250 points on widespread buying by participants in metal, realty and banking stocks after the US and China agreed to resume trade talks last night.

Taking positive cues from global equities, the 30-share index was trading higher by 262.91 points, or 0.69 percent, at 37,926.47. The index had lost 188.44 points in the previous session. The NSE Nifty reclaimed the 11,400 mark, by rising 62.15 points, or 0.55 percent, to 11,447.20.

All sectoral indices, led by metal, FMCG, realty, auto, banking, PSU, healthcare, infrastructure, power, capital goods, oil and gas and IT, recovered up to 1.38 percent.

Major gainers were Vedanta, Tata Steel, ITC, Yes Bank, Adani Ports, Tata Motors, Axis Bank, SDBI, ICICI Bank, RIL and Asian Paints, rising up to 2.13 percent

While, Wipro, Bharti Airtel, Bajaj Auto and HDFC were trading in the negative zone, falling up to 0.70 percent.

Domestic institutional investors (DIIs) bought shares worth a net of Rs 133.78 crore while foreign portfolio investors (FPIs) sold shares worth a net of Rs 825.08 crore yesterday, provisional data showed.

Investor sentiment turned positive after the US and China agreed to resume trade talks last night, traders said.

Amid a stalemate in the trade war with the US, China will send a top official to Washington this month to resume the high-level dialogue to resolve the deadlock over President Donald Trump’s demand to drastically reduce the USD 375 billion trade deficit.

Elsewhere in Asia, Japan’s Nikkei rose 0.44 percent and Hong Kong’s Hang Seng was up 0.46 percent, while Shanghai Composite Index was down 0.39 percent.

US stocks rallied to close higher yesterday. The US Dow Jones Industrial Average ended 1.58 percent higher yesterday.

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Rupee plummets to historic low of 70.09 on Turkish lira collapse

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Mumbai  |  Reversing all its early gains, the rupee today collapsed to a lifetime low of 70.09 against the US dollar, falling 16 paise amid fears that Turkish economic crisis could lead to a global financial meltdown.

The ongoing currency turmoil in Turkey has dampened investors’ sentiments globally. Investors are turning to the dollar as a safe haven with Turkeys currency lira crisis continuing since the last week.

Yesterday, the rupee had plunged by Rs 1.08, or 1.57 per cent, to a record low of 69.93 against the US currency.

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Rupee recovers from life low, up 23 paise

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Rupee

Mumbai | The rupee recovered from all-time low of 69.91 and strengthened by 23 paise to 69.68 against the US dollar in opening trade at the interbank foreign exchange market today on some macroeconomic boost.

Yesterday, the rupee had plunged by Rs 1.08, or 1.57 percent, to a record low of 69.91 against the US currency amid fears that Turkish currency turmoil could turn out into global financial crisis.

In a ray of hope for domestic economy, latest data showed that retail inflation fell to 9-month low of 4.17 percent in July on declining vegetable prices which may prompt the Reserve Bank to pause interest rate hike in its next monetary policy review.

In the last two reviews, the RBI had raised the key repo rate by 0.25 percent each on inflationary concerns. The next bi-monthly policy is to be unveiled on October 5. Stock markets opening with gains also boosted the domestic currency, dealers said. However, the dollar’s strength against some currencies overseas capped the gains of the domestic unit.

Meanwhile, the benchmark BSE Sensex recovered 184.93 points, or 0.49 percent, to 37,829.83 points in early trade today.

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