Bourses soar to day’s high on sustained buying activities

Extending early gains, the local equity markets reached at their intra-day high levels in early afternoon session as buying momentum in the equities persisted. Sentiments on the street improved further with a private report stating that business optimism index for the January-March quarter 2018 touched three and half year high on improving demand conditions and expectation that government sops in the budget will revive consumption. Some optimism also came with Crisil’s latest report stating that India will benefit from stronger global growth in the fiscal 2019 provided there are no more after effects from the implementation of the new goods and services tax (GST) and the economy manages to tide over the asymmetry in monetary policy of advance economies together with higher crude oil prices. Moreover, optimism over corporate earnings along with recovery in the rupee value against dollar too supported the major indices to extend their gains. In scrip specific development, Generic Engineering Construction & Projects was up by over a percent after bagging orders worth Rs 69 crore from various new and existing reputed clients.

On the global front, Asian markets were trading mostly in red, as the region’s resource shares were hit by falling oil and commodity prices. Back home, the BSE Sensex is currently trading at 34943.76, up by 172.71 points or 0.50% after trading in a range of 34700.82 and 34966.94. There were 19 stocks advancing against 12 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was up by 0.23%, while Small cap index was down by 0.02%.

The top gaining sectoral indices on the BSE were IT up by 1.26%, TECK up by 0.96%, Bankex up by 0.64%, Capital Goods up by 0.63% and Healthcare up by 0.63%, while Consumer Durables down by 0.20%, Oil & Gas down by 0.19%, Auto down by 0.11%, Consumer Disc down by 0.11% and Realty down by 0.10% were the top losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 2.43%, Infosys up by 2.41%, Adani Ports & SEZ up by 2.02%, SBI up by 1.50% and Dr. Reddy’s Lab up by 1.27%. On the flip side, Wipro down by 1.91%, Hero MotoCorp down by 1.53%, Tata Motors down by 1.29%, ONGC down by 0.61% and HDFC Bank down by 0.58% were the top losers.

Meanwhile, the World Gold Council (WGC) in its report titled 'Outlook 2018 Global economic trends and their impact on gold' has stated that gold demand will get a boost from government policies targeted at transparency and gross domestic product (GDP) growth. It believed that in India, the second largest gold market in the world, after their initial implementation shock, policies such as the demonetisation initiative and the new Goods and Service Tax (GST) will start to have a positive effect on the economy. It noted that these policies are designed to improve transparency, broaden the tax base, and draw the informal, cash-based economy into the formal sector.

According to the report, continued economic growth underpins gold demand. It also noted that as incomes rise, demand for gold jewellery and gold-containing technology, such as smart phones and tablets rises. It believes that income growth also spurs savings, helping increase demand for gold bars and coins. Meanwhile, it highlighted that global growth increased in 2017 and the market expects the trend to continue in 2018 as well. It pointed out that with the European and US economies expanding, coupled with decreasing unemployment in recent years, there has been a rise in wages yet inflation indices are low.

The report further said that households and businesses are rebuilding their finances and are optimistic about the future. Besides, it said that China's economy to continue growing, but the nature of growth is changing from investment-driven growth to a consumption-led model. It added that this could affect the economic growth rate, but even if the Chinese economy grows at a slower rate than in the past, they see a more balanced model, aided by further global integration through its One Belt One Road initiative supporting a sustainable growth trajectory.

The CNX Nifty is currently trading at 10751.90, up by 51.45 points or 0.48% after trading in a range of 10666.75 and 10752.40. There were 32 stocks advancing against 17 stocks declining on the index, while 1 stock remained unchanged.

The top gainers on Nifty were Infosys up by 2.56%, Adani Ports & SEZ up by 2.22%, SBI up by 1.74%, Aurobindo Pharma up by 1.70% and HPCL up by 1.62%. On the flip side, Wipro down by 1.82%, Hero MotoCorp down by 1.25%, Tata Motors down by 0.97%, Ambuja Cement down by 0.90% and GAIL India down by 0.84% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 decreased 83.47 points or 0.35% to 23,868.34, Hang Seng was down by 36.3 points or 0.11% to 31,868.45, KOSPI Index shed 6.31 points or 0.25% to 2,515.43 and FTSE Bursa Malaysia KLCI dropped 1.3 points or 0.07% to 1,824.73.

On the flip side, Jakarta Composite increased 6.33 points or 0.1% to 6,436.02, Shanghai Composite added 14.43 points or 0.42% to 3,451.03 and Taiwan Weighted was up by 18.69 points or 0.17% to 11,004.80.