Indian benchmarks kickoff the week on a sanguine note

Indian stock markets finished the first day of F&O expiry week on an optimistic note, with Sensex gaining over half a percept, while Nifty closed above 8850 mark. Investors continued to build hefty positions across the board as sentiments got a boost after the report that GST Council on Saturday approved a law to compensate states for any loss of revenue from the implementation of the new national sales tax but deferred approval for enabling laws to the next meeting. The council will meet again on March 4 and 5 to approve the legally vetted draft of the supporting legislations for Central GST (C-GST) and Integrated GST (I- GST), days before the start of the second leg of the Budget Session. Some support also came with the report that overseas investment in India is likely to surge to a record in the year ending March despite temporary growth hiccups ascribed to the currency swap programme. India’s FDI in the April-December period rose 22% to $35.8 billion from the year earlier. With three months to go for the fiscal year end, the government expects fresh inflows into equity to top the $40 billion India got in FY16. Meanwhile, stocks related to Sugar sector remained in focus after the report that India's sugar deficit increased to 15% as on February 15, from 10% on January 31, as sugarcane crushing season in Karnataka has almost come to an end, while that of Maharashtra is at its fag end. Furthermore, some banking stocks came into lime light on the report that once the Insolvency and Bankruptcy Bill is passed, the sale of bad loans to asset reconstruction companies (ARCs) could improve substantially to 30-35% of the loans put on the block by banks and financial institutions from the current 10-15%.

On the global front, Asian markets ended mostly in green on Monday, though traders remained cautious ahead of key US Federal Reserve events, including minutes of the last policy meeting and speeches by five heads of Fed regional banks. Chinese shares ended higher after reports that pension funds are entering the stock market. Investor sentiment boosted after China's securities regulator unveiled new rules on Friday restricting excessive and frequent fundraising by some listed companies. Further Japanese shares eked out small gains in a choppy session marked by low volumes as investors stayed on the sidelines with the US markets closed for a holiday. Meanwhile, European stocks edged higher, as higher commodity prices and optimism about U.S. President Donald Trump's promised tax and regulation cuts helped outweigh French election worries.

Back home, the local benchmarks got off to a soft start as the indices showed signs of consolidation in early trade amid political uncertainty infecting markets across the Asia. But the frontline indices slowly but steadily started gathering steam and surged by quarter percent by late morning trades. The bourses further capitalized on the momentum and spurted in afternoon trades on the back of broad based bottom fishing in undervalued stocks. Eventually, the NSE’s 50-share broadly followed index Nifty, got buttressed by over half percent to settle above the crucial 8,850 support level, while Bombay Stock Exchange’s Sensitive Index-Sensex accumulated around two hundred points and closed above the psychological 28,600 mark. Moreover, the broader markets too participated in the rally and closed with gains of over half a percent. On the BSE sectoral space, buying was evident across the board and investors piled up hefty positions in Metal counter, which rocketed by over two percent, while the IT, Teck and Telecom pockets too gained from strength to strength and climbed by over one hand half percent each. However, only chink in the armor was the FMCG index, which closed on a flat note with a negative bias as heavyweights like ITC, United Spirits and Marico plunged by around a percent.

The market breadth remained optimistic, as there were 1709 shares on the gaining side against 1132 shares on the losing side, while 199 shares remained unchanged.

Finally, the BSE Sensex surged 192.83 points or 0.68% to 28661.58, while the CNX Nifty was up by 57.50 points or 0.65% to 8,879.20.

The BSE Sensex touched a high and a low of 28696.53 and 28419.27, respectively and there were 22 stocks on gainers side as against 8 stocks on the losers side on the index.

The broader indices ended in green; the BSE Mid cap index surged 0.68%, while Small cap index was up by 0.91%.

The top gaining sectoral indices on the BSE were Metal up by 2.04%, IT up by 1.62%, TECK up by 1.60%, Telecom up by 1.52% and Utilities up by 1.51%, while FMCG down by 0.06% was the sole losing index on BSE.

The top gainers on the Sensex were TCS up by 4.08%, Tata Steel up by 4.01%, GAIL India up by 2.80%, HDFC Bank up by 2.18% and Power Grid up by 1.95%. On the flip side, Axis Bank down by 1.72%, ITC down by 0.89%, HDFC down by 0.56%, Dr. Reddy’s Lab down by 0.40% and ICICI Bank down by 0.30% were the top losers.

Meanwhile, With the digital transactions increasing rapidly after demonitisation move on November 9, 2016, a sum of Rs 27,000 crore so far has been saved through Direct Benefit Transfer (DBT) scheme and about 35 per cent people have taken to the debit card, RuPay card and e-wallet services for making payments in Haryana.

The Union Minister of State for Social Justice and Empowerment, Krishan Pal Gujjar, has said that 100 Digi Dhan Melas were being organised in the country and so far, 56 such melas have been held to encourage people to adopt cashless transaction system for making payments. He also urged the people to make digital transactions to realise the dream of Prime Minister Narendra Modi, and also encourage others to adopt this system.

Gujjar noted that the main aim of Digi Dhan Mela is to give people message of ‘Mera Mobile-Mera Bank-Mera Batua’. Besides, Haryana Education Minister Ram Bilas Sharma also expressed his hopes that such events would inspire people to adopt digital payment methods.

The CNX Nifty traded in a range of 8,886.25 and 8,809.80. There were 35 stocks in green as against 16 stocks in red on the index.

The top gainers on Nifty were TCS up by 4.03%, Tata Steel up by 3.89%, Infosys up by 2.99%, GAIL India up by 2.90% and BPCL up by 2.80%. On the flip side, Axis Bank down by 1.88%, Bosch down by 0.95%, Tech Mahindra down by 0.78%, Yes Bank down by 0.76% and ITC down by 0.75% were the top losers.

The European markets were trading mostly in green; Germany’s DAX increased 60.96 points or 0.52% to 11,817.98, France’s CAC increased 7.27 points or 0.15% to 4,874.85, while UK’s FTSE 100 decreased 2.21 points or 0.03% to 7,297.75.

Asian equity markets ended mostly higher on Monday as the yen weakened after Japanese trade balance figures missed expectations, and oil prices held steady after posting their first weekly decline in five weeks on concerns over rising production and swelling stockpiles in the US. Reports showed that Japan posted a merchandise trade deficit of 1,086.9 billion yen in January as exports slowed down from the previous months due to a decline in US exports and the timing of Chinese New Year holidays. That missed forecasts for a shortfall of 625.9 billion yen following the 640.4 billion yen deficit in December. Chinese shares ended higher after reports that pension funds are entering the stock market. Investor sentiment was also boosted after China's securities regulator unveiled new rules on Friday restricting excessive and frequent fundraising by some listed companies. Japanese shares eked out small gains in a choppy session marked by low volumes as investors stayed on the sidelines with the US markets closed for a holiday. Though, a lack of clarity on the timing and scope of promised pro-growth policies from the Trump administration and the probability of a US rate hike as early as March kept a lid on gains across the region. The Federal Reserve will release the minutes of its last monetary policy meeting on Wednesday, with investors looking for further clues on Fed's assessment of the economic conditions and the timing of the next rate hike.