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Sensex spirals to record high in early trade on the back of exit polls

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The benchmark BSE Sensex jumped over 200 points to hit a record intra-day high of 39,565.82 as investors’ euphoria over exit poll outcome continued in early session on Tuesday.

The 30-share index was trading 205.24 points, or 0.52 per cent, higher at 39,557.91. In similar movement, the broader NSE Nifty rose 48.90 points, or 0.41 per cent, to 11,877.15.

In the previous session, the Sensex ended 1,421.90 points, or 3.75 per cent, higher at 39,352.67, and the Nifty soared 421.10 points, or 3.69 per cent, to 11,828.25.

Top gainers in the Sensex pack in morning trade include HDFC twins, Bajaj Finance, Coal India, RIL, Bajaj Auto, HUL, IndusInd Bank, Sun Pharma, Vedanta, Axis Bank and Asian Paints, rising up to 2.21 per cent.

On the other hand, Tata Motors, Yes Bank, Bharti Airtel, Tata Steel, SBI, Infosys, ONGC and TCS fell up to 3.18 per cent.

“Market has given a thumbs-up to exit poll numbers. Sentiments have turned around drastically and the benchmark indices can gain 5-8 per cent more from here over the next few weeks if the final election outcome is in line or even better than exit polls,” said Gaurav Dua, Senior VP, Head – Strategy and Investments, Sharekhan by BNP Paribas.Most exit polls forecast another term for Prime Minister Narendra Modi. The results of the seven-phase polls will come out Thursday.

Meanwhile, market regulator Sebi and stock exchanges have beefed up their surveillance mechanism to check any manipulative activities in the market this week in view of the high-octane election related events lined up.

Foreign institutional investors bought equity worth Rs 1,734.45 crore on Monday, while domestic institutional investors sold shares to the tune of Rs 542.71 crore, provisional data available with stock exchanges showed.

Elsewhere in Asia, bourses in China, Japan and Korea were trading on a mixed note in their respective early sessions.

Benchmarks on Wall Street ended in the red on Monday.

On the currency front, the rupee appreciated marginally to 69.71 against the US dollar in opening trade Tuesday.

Brent crude, the global benchmark, was trading at 72.20 per barrel, higher by 0.32 per cent. PTI ANS ANS

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World Bank keeps growth forecast for India at 7.5%, warns against ‘skirmishes’

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The World Bank has retained its forecast for growth in India at 7.5% in the 2019-20 fiscal and the succeeding years, but warned that re-escalation of India-Pakistan tensions arising from “military skirmishes” such as the one in February could increase uncertainty and impact investments in the region.

Continued GDP projection of 7.5% should be reason for some relief and celebration coming as it does amid ongoing efforts to fix the way India measures growth, which has come under intense scrutiny, and some distrust, after a government agency discovered serious gaps in a key government database.

In its “Global Economic Prospects: Heightened Tensions, Subdued Investment” released Tuesday, the World Bank downgraded global growth prospects by 0.3% to 2.6% for the 2019-20 fiscal “reflecting weaker-than- expected international trade and investment at the start of the year”. This will begin improving here after and growth might touch 2.8% in 2021.

India, on the other hand, will not only grow by 7.5%, but as the largest economy in South Asia, help the region post a “solid” growth. Pakistan, on the other hand, will continue the downslide and decelerate to 3.4% from 5.8% in the previous fiscal. Its economic woes have forced it to seek yet another bailout package from the International Monetary Fund, and consultations are underway on terms and conditions.

Military tensions broke out between the two South Asian neighbors in February after a terrorist attack in Pulwama by the Pakistan-based Jaish-e-Mohammad. India struck the outfit’s training facilities in Balakot in Pakistan. And Pakistan retaliated with an air raid that led to the downing of an Indian air force fighter jet.

The World Bank noted that the “military skirmishes between major South Asian countries in mid-February remained contained, and economic repercussions were minor”. But, it warned that, “a re-escalation of tensions between the two countries could increase uncertainty, depress confidence, and weigh on investment in the region”.

The Bank also cited the February “skirmishes between India and Pakistan” as a “reminder that latent geopolitical tensions can flare up at any time”, in reference to risks to regional and global economies.

“Uncertainty” about Brexit, Britain leaving the European Union, was cited among other key challenges and risks confronting India and other South Asian countries. “Uncertainty about the Brexit process poses a risk to some South Asian economies which have preferential trade agreements or generalized system of preferences with the European Union and significant exports to United Kingdom (Bangladesh, India, Pakistan, Sri Lanka),” the Bank said.

“A no-deal Brexit could have a significant impact on exports of those countries to the UK in the absence of new trade agreements,” it added.

British Prime Minister Teresa May is leaving office after failing to present a Brexit deal acceptable to the Parliament, and it’s up to her successor to find a way out of the current impasse. Another referendum to certain if Britain really wants to leave the European Union was among May’s last suggestions.

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Trump hints at ‘big’ trade offer if Britain breaks free from EU

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Donald Trump waded into the UK’s fraught politics on the first day of a state visit, urging his hosts to proceed with Brexit and dangling the promise of a U.S. trade deal he said would swiftly follow.

With the country preparing for the appointment of a new prime minister, Trump called on the British to throw off the “shackles” of European Union membership in a tweet before a banquet hosted by Queen Elizabeth II.

The White House issued a statement saying that the president supports a Brexit “being accomplished in a way that will not affect global economic and financial stability while also securing independence to the United Kingdom.”

Trump will meet Tuesday with Premier Theresa May, likely for the last time. May, who became the Conservative government’s leader in the wake of the 2016 Brexit referendum, is resigning after failing to persuade Parliament to approve the divorce deal she negotiated with the EU, leaving the issue in the hands of her successor.

The American president has suggested that person should be Boris Johnson, the former foreign secretary who quit May’s cabinet in protest over her Brexit proposal.

In the lead-up to his trip to London, Trump said the U.K. should walk away from tortured talks with the EU if Brussels refuses to negotiate better terms, and said Nigel Farage – who’s campaigning for a no-deal Brexit – should be put in charge of the process.

A hard split with the EU would give maximum scope for a new trade accord with the US If the UK remained bound to the bloc’s regulations, it would narrow the options for a future agreement.

It’s a sensitive issue in the UK Rivals jockeying to replace May are putting forward their own Brexit plans, with the favorite, Johnson, pledging to take Britain out of the EU – with no deal, if necessary – at the end of October.

‘Powerful Deal’

Trump criticized May’s compromise agreement with the EU last November, saying Britain “may not be able to trade with us” as a result. His comments dashed hopes stoked by his comments made before an earlier meeting with May, when he said “a very big deal, a very powerful deal” would be completed between the two countries “very very quickly.”

Opponents of Brexit say a trade deal with the US risks imperiling the National Health Service, by increasing the involvement of private US companies in the public sector. May’s office was forced to reiterate Monday that the state-funded health-care system would not be up for discussion in trade talks.

The statement potentially put her government at odds with Trump after his ambassador in London, Woody Johnson, told the BBC that the “entire” UK economy would be on the table.

Trump and May will meet American and British business leaders on Tuesday at the start of the second day of his visit, which could throw up more controversy than Monday’s schedule of royal visits and pageantry.

‘Greater Still’

May, who will co-host the talks at St. James’s Palace, will call for governments on both sides of the Atlantic to embrace the opportunity of Brexit to seal a bilateral free-trade deal, and work together to keep global markets “free, fair and open.”

Before the talks, the prime minister’s office called for greater cooperation in a statement that appeared to acknowledge the potential differences of opinion.

The partnership between the US and UK “can be greater still” if they continue “to work together to underpin, shape and influence the global economy and its rules and institutions,” May will say, according to extracts of her remarks released by her office.

Trump has clashed with global economic institutions including the International Monetary Fund and the World Bank, and his use of tariffs in trade conflicts with China, Europe and Mexico has alarmed markets, adding to uncertainty around Brexit for companies investing in the UK.

The talks will include executives from BAE Systems Plc, GlaxoSmithKline Plc, National Grid Plc, Barclays Bank Plc, Reckitt Benckiser Group Plc, JPMorgan Chase & Co, Lockheed Martin Corp, Goldman Sachs International, Bechtel Corp and Splunk Inc.

Johnson, Farage

Small and elite by design, the event is timed to put Trump in control of the message at the start of the day, before talks with May’s team at 10 Downing Street.

He is expected to pressure the UK over Huawei Technologies Co., which the US wants to see shut out of 5G broadband networks across Europe.

A joint news conference with the prime minister will then give Trump – if he chooses – a further chance to intervene in British politics.

The president is all but certain to be asked about his views on Boris Johnson and Farage, whose fledgling Brexit Party inflicted a heavy defeat on May’s Tories in European elections last month.

While Trump had held out the possibility that he could meet with the two men, no plans had been announced by Monday evening. If the meetings are to take place, the most likely timing is Tuesday afternoon.

Trump’s first day in London was largely free from controversy – once he’d actually landed. Minutes before Air Force One touched down at Stansted Airport, he renewed his long-running spat with Mayor of London Sadiq Khan, calling him a “stone cold loser.”

It was an apparent response to a newspaper column by Khan – the first Muslim mayor of a major Western capital – in which he called Trump “one of the most egregious examples” of the global rise of the far right.

Trump and the Queen

At the Buckingham Palace banquet, the president and the British monarch exchanged toasts.

The queen hailed the “assembly of international institutions” created after World War II “to ensure that the horrors of conflict would never be repeated.”

“While the world has changed, we are forever mindful of the original purpose of these structures: nations working together to safeguard a hard-won peace,” she said.

Trump has frequently questioned the continued utility of such institutions, including the United Nations and NATO.

He toasted “the common values that will unite us long into the future: freedom, sovereignty, self-determination, the rule of law, and reverence for the rights given to us by almighty God.”

Thousands of anti-Trump protesters are expected to take to the streets on Tuesday, with Labour Party leader Jeremy Corbyn planning to address the crowds about the time of the Trump-May news conference.

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Donald Trump urges UK to be ‘very careful’ over Huawei, 5G

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US president Donald Trump urged Britain to be “very careful” about involving Chinese tech giant Huawei in its new 5G network, in an interview published Saturday ahead of his state visit to London.

Asked about reports that Britain is planning to give the firm a limited role, Trump told the Sunday Times newspaper: “Well, you have other alternatives and we have to be very careful from the standpoint of national security.”

He added: “You know we have a very important intelligence gathering group, that we work very closely with your country (Britain) and so you have to be very careful.”

The US has long voiced suspicions that Huawei is controlled by the Chinese government and thus a global security threat — charges strongly denied by the firm and by Beijing.

Prime Minister Theresa May’s government has insisted a decision has not yet been made on Huawei’s involvement in building a 5G network in Britain. Trump said he believed “things will all work out, you’ll see”.

In a wide-ranging interview, the president also repeated previous criticism of May’s strategy for taking Britain out of the European Union.

She is due to step down in the coming weeks over her failure to deliver Brexit on time. Trump suggested her as-yet unchosen successor should abandon talks with the bloc if they do not get a better deal.

“I would walk away. If you don’t get the deal you want, if you don’t get a fair deal, then you walk away,” he said.

Protests planned

Trump on Friday used another newspaper interview to endorse former foreign minister Boris Johnson to succeed May.

Opposition Labour leader Jeremy Corbyn, who is boycotting a state banquet with Trump, called it an “entirely unacceptable interference in our country’s democracy”.

On Saturday, the president suggested another leading Brexit supporter, Nigel Farage, should help negotiate with Brussels. He said that Farage, whose Brexit party caused a major upset in recent European elections, “has a lot to offer”.

Trump will be welcomed to London on Monday by Queen Elizabeth II at the start of a three-day state visit that will also include talks with May and a ceremony marking 75 years since the D-day landings.

Large protests are planned and London Mayor Sadiq Khan said Sunday it was wrong to be rolling out the red carpet.

Writing in The Observer newspaper, Khan — who has had several Twitter spats with Trump — said the president was “one of the most egregious examples” of a growing global threat from the far-right.

He said leaders such as Hungary’s Viktor Orban and Farage “are using the same divisive tropes of the fascists of the 20th century to garner support, but are using new sinister methods to deliver their message”.

Khan said Trump’s “divisive behaviour flies in the face of the ideals America was founded upon — equality, liberty and religious freedom”.

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