Benchmarks trade in fine fettle in early deals; Nifty reclaims 9,900 mark

Indian equity benchmarks have made an optimistic start to the new week and are trading in fine fettle in early deals with frontline gauges recapturing their crucial 32,100 (Sensex) and 9,900 (Nifty) levels. Sentiments remained up-beat with latest edition of the OECD’s economic outlook report on India stating that economic growth is projected to remain strong and India will remain the fastest growing G20 economy. It added that private consumption has been buoyant, boosted by the increase in public wages and pensions and by higher agricultural and rural incomes. Some support also came with report that India’s trade deficit narrowed more-than-expected to $12.96 billion in June as gold imports nearly halved from a month earlier. However, traders remained little cautious ahead of the start of the monsoon session of Parliament. A total of 21 Bills pending in Lok Sabha and 42 Bills pending in Rajya Sabha will be in focus.

Global cues too remained supportive with Asian markets trading mostly in green at this point of time, though the Chinese market was down amid concern that policies to reduce leverage in Asia’s biggest economy will curb earnings. The US markets moved higher in the last session with Dow and S&P climbing to new record highs.

Back home, Prime Minister Narendra Modi held a meeting with senior government functionaries to review the country’s current foreign direct investment (FDI) policy, which discussed measures to further liberalise the policy, so as to attract more FDI in various sectors. Meanwhile, the market breadth indicating the overall health of the market was strong, with 1,036 shares gaining and 877 shares declining, while a total of 110 shares were unchanged.

The BSE Sensex is currently trading at 32101.75, up by 81.00 points or 0.25% after trading in a range of 32053.98 and 32116.15. There were 21 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.03%, while Small cap index was up by 0.09%.

The top gaining sectoral indices on the BSE were IT up by 1.20%, TECK up by 1.07%, Basic Materials up by 0.70%, Telecom up by 0.59% and Metal up by 0.55%, while FMCG down by 0.94%, Realty down by 0.29% and Capital Goods down by 0.08% were the few losing indices on BSE.

The top gainers on the Sensex were Wipro up by 4.51%, Adani Ports up by 1.82%, Infosys up by 1.54%, ONGC up by 1.20% and ICICI Bank up by 0.97%. On the flip side, ITC down by 1.87%, Axis Bank down by 0.43%, Coal India down by 0.34%, Larsen & Toubro down by 0.20% and HDFC Bank down by 0.17% were the top losers.

Meanwhile, hailing the several initiatives taken by the new government, the latest edition of the OECD’s economic outlook report on India has said that economic growth is projected to remain strong and India will remain the fastest growing G20 economy. It said that the acceleration of structural reforms in the Indian economy, with the efforts made by Prime Minister Narendra Modi led BJP government in the centre, is bringing a new growth impetus, which has won the confidence of the people by increasing public wages and pensions that will support consumption.

The Organisation for Economic Co-operation and Development (OECD) in its June 2017 report said that, “The increase in public wages and pensions will support consumption. Private investment will recover gradually as excess capacity diminishes, and the landmark Goods and Services Tax and other measures to improve the ease of doing business are being implemented.” According to report, the newly implemented Goods and Services Tax (GST) has framed India into a single tax market and thus will spur productivity, investment, competitiveness, job creation and incomes.

The report also noted that the costs of the withdrawal of high denomination notes - demonetisation - in November 2016 are wearing off, and sales of cars and two-wheelers have bounced back. It also said, exports have picked up, driven by strong demand from Asia and the euro area. Higher oil prices and gold imports, coupled with a decline in remittances inflows, are reflected in some deterioration in the current account deficit.

The CNX Nifty is currently trading at 9915.10, up by 28.75 points or 0.29% after trading in a range of 9894.70 and 9916.25. There were 38 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Wipro up by 4.60%, Adani Ports up by 1.65%, Tech Mahindra up by 1.59%, Infosys up by 1.54% and HCL Tech up by 1.36%. On the flip side, GAIL India down by 1.96%, ITC down by 1.84%, Aurobindo Pharma down by 0.54%, Indian Oil down by 0.50% and Sun Pharma down by 0.45% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI rose 1.45 points or 0.08% to 1,756.45, Jakarta Composite gained 4.38 points or 0.08% to 5,836.17, KOSPI Index increased 8.08 points or 0.33% to 2,422.71, Taiwan Weighted added 19.65 points or 0.19% to 10,463.56 and Hang Seng was up by 152.77 points or 0.58% to 26,542.00. On the flip side, Shanghai Composite was down by 3.67 points or 0.11% to 3,218.75.