Mumbai: The BSE Sensex lost all its morning gains in Friday’s session after it hit a lifetime high of 40,688.27 earlier in the session. The index was at 40,576 at 2 p.m., down 74 points or 0.2%. The morning gains were led by auto and banking stocks. Hopes of trade pact between US-China lifted the sentiments.

Market participants seemed to ignore Moody’s cutting India’s rating to ‘negative’ from ‘stable’ as the index touched new highs. The rating agency said its decision to change the outlook to negative reflects increasing risks that economic growth will remain materially lower than in the past, partly “reflecting lower government and policy effectiveness at addressing long-standing economic and institutional weaknesses, leading to a gradual rise in the debt burden from already high levels."

Reports that China and the U.S. had agreed to roll back tariffs on each other’s goods in phases as they work toward a deal between the two sides also helped the sentiment. The two nations reportedly want a phase one deal on paper by the end of next week

Among banking gainers, ICICI Bank rose 4% to hit a fresh record high after its weight was increased in the MSCI EM Index. Yes Bank was up 6%, Indusind Bank 5%, Kotak Mahidnra Bank 1% and State Bank of India 0.6%

In auto stocks, Mahindra & Mahindra rose 2%, Tata Motors 1.3%, Hero MotoCorp 0.6%, Maruti Suzuki India 0.4%.

Among laggards, Sun Pharmaceuticals fell 2.7%. The company reported September quarter results in line with expectations, with revenues merely 2% below.

DLF and HDFC Asset Management Company gained after the inclusion of both the stocks in MSCI India. DLF rose 8% and HDFC Asset Management gained 6%.

Raymond rose 20% after the company said it will demerge its core lifestyle business into a separate listed entity to simplify the group structure and create investor opportunities.

Indraprastha Gas jumped 5% to hit record high after the company reported better-than-expected earnings. Indraprastha Gas reported standalone EBITDA and PAT of Rs3.93 bln and Rs3.81 bln in Q2FY20. Earnings were 6% higher than our estimate due to better margins, while the new tax regime resulted in a negative tax of Rs133mn, which drove PAT.

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