Indian share markets ended over 1% higher today aided by a firm rupee against the dollar. At the closing bell, BSE Sensex ended up by 461 points, while, NSE Nifty ended up by 159 points.
Except IT stocks, all sectoral indices ended the day in green with realty sector and consumer durables sector surging over 4%.
Globally, Asian stock markets finished higher today with shares in China leading the region. The Shanghai Composite ended up 0.2% while Japan’s Nikkei 225 was also up 0.2% and Hong Kong’s Hang Seng closed up by 0.1%. European markets are lower today with shares in France off the most. The CAC 40 is down 0.6% while Germany’s DAX is off 0.6% and London’s FTSE 100 is lower by 0.2%.
The rupee was trading at Rs 74.17 against the in the afternoon session.
In the news from the economy. Global rating agency Moody’s Investors Service has termed government’s decision to cut excise duty on petrol and diesel as credit negative for the India.
Moody’s stated that this will reduce government revenue and increase fiscal deficit by 0.1% to 3.4% of Gross Domestic Product (GDP) in the year ending March 2019.
It also said that the earning of public sector oil marketing companies (OMCs) would be negatively affected as they also absorbed Rs 1 per litre cut in their pricing. It added that these measures create downside risks to the central government’s fiscal deficit target of 3.3% of GDP for financial year 2018.
The rating agency said as the government had already met 94.7% of the budgeted annual deficit by August 2018, to achieve its deficit target it will likely need to compress capital expenditure. Consequently, it expects the central government deficit target to slip modestly to 3.4% of GDP, while the combined general government deficit (central and state) should remain at about 6.3% of GDP.
It said that the government revenue from excise duties on petroleum products has more than doubled since financial year 2014. State governments charge value added tax (VAT) on fuel as a percentage of prices and have therefore benefited from rising oil prices.
