Benchmarks make optimistic start on firm global cues

Buoyed by firm global cues, Indian equity benchmarks made an optimistic start and are trading with traction in early deals on Tuesday, amid easing concerns about a potential trade war. Traders took some encouragement with the government’s decision to bring down market borrowings during the first-half of FY19 following careful assessment of its financial needs. The Centre will raise a gross Rs 2.88 lakh crore from market borrowings in the first half of the fiscal. It has also chosen to introduce shorter duration government securities and will also an additional Rs 25,000 crore from the National Small Savings Fund against the Budgeted Rs 75,000 crore to cut down its requirement for fund raising. Investors also took some support with Economic Affairs Secretary Subhash Chandra Garg’s statement that the country is well poised to click a growth rate of 7-8 per cent and with focus on start-ups, MSMEs and infrastructure investment it can step on to higher growth pedestal.

Global cues remained supportive with Asian markets rallying at this point of time after Wall Street rebounded on the first day of the trading week amid a slight easing in trade tensions. Bargain hunting contributed to the rally on Wall Street, with the Dow bouncing off its lowest closing level in nearly four months.

Back home, traders drew some support from NITI Aayog’s statement that the Indian economy is growing at 7 -8 per cent which needs to be reflected on the human development index (HDI) wherein the country stands at 131st position out of 188 nations. Meanwhile, Chief Economic Adviser Arvind Subramanian has said the task force on direct tax reforms will submit its report in the next 4-5 months. In scrip specific developments, GE Shipping soared on inking contract to buy secondhand Medium Gas Carrier, while Punj Lloyd edged higher on bagging order worth Rs 505 crore in Odisha by NHAI.

The BSE Sensex is currently trading at 33214.36, up by 147.95 points or 0.45% after trading in a range of 33170.53 and 33311.31. There were 23 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index surged 1.08%, while Small cap index was up by 1.38%.

The top gaining sectoral indices on the BSE were Metal up by 1.45%, Basic Materials up by 1.20%, Healthcare up by 1.08%, Industrials up by 1.00% and Bankex up by 0.99%, while Telecom down by 0.76% was the lone losing index on BSE.

The top gainers on the Sensex were Axis Bank up by 2.22%, Tata Steel up by 2.09%, Wipro up by 1.86%, ICICI Bank up by 1.47% and Kotak Mahindra Bank up by 1.39%. On the flip side, Bharti Airtel down by 1.58%, Hero MotoCorp down by 1.00%, Mahindra & Mahindra down by 0.43%, Infosys down by 0.30% and NTPC down by 0.29% were the top losers.

Meanwhile, with Indian economy continuing its focus on producing goods & services and generating demands for next 7-8 years, the Economic Affairs Secretary Subhash Chandra Garg has stated that the country can double the size of its economy to $5 trillion by 2025 and it is on track to achieve this goal. He also asserted that the inflation target set by the Reserve Bank of India (RBI) will not be breached. Currently, India’s GDP in value terms stands at $2.5 trillion, making it the sixth largest economy in the world.

In order to capitalise on the macroeconomic environment and achieve the $5 trillion goal, Garg has said that India needed to improve its share in the global trade pie. He also said that with focus on start-ups, MSMEs and infrastructure investment, the nation can step on to higher growth pedestal and can grow at about 7-8% in real terms and 9-10% in nominal terms. He further said that apart from a robust growth in the traditional sectors like textiles, the country also needed to concentrate on services sector in an increasingly competitive global economy.

The Economic Affairs Secretary added that the macro economic factors, including inflation, don’t poise any risk to India’s $5 trillion economy target and inflation in the country is very stable. On the inflation front, he said that its trajectory is well within the RBI’s target of 4%, plus/minus 2%. He also said “We have been extremely successful in adhering to that (inflation target) and going forward also I don't see any major risk in not adhering to that.” Besides, WPI inflation fell to a 7 month low of 2.48%, while retail inflation was also at 4 month low of 4.44% in the month of February.

The CNX Nifty is currently trading at 10179.65, up by 49.00 points or 0.48% after trading in a range of 10162.30 and 10205.50. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing up by 2.49%, Axis Bank up by 2.38%, HPCL up by 2.28%, Tata Steel up by 2.15% and Bajaj Finance up by 2.11%. On the flip side, Bharti Infratel down by 2.14%, Bharti Airtel down by 1.60%, GAIL India down by 1.46%, Hero MotoCorp down by 0.93% and HCL Tech. down by 0.80% were the top losers.

All the Asian markets are trading in green; FTSE Bursa Malaysia KLCI rose 4.57 points or 0.25% to 1,864.48, KOSPI Index gained 12.11 points or 0.5% to 2,449.19, Shanghai Composite increased 30.3 points or 0.97% to 3,164.02, Jakarta Composite jumped 37.24 points or 0.6% to 6,237.41, Taiwan Weighted surged 117.8 points or 1.09% to 10,957.85, Hang Seng added 277.69 points or 0.91% to 30,826.46 and Nikkei 225 was up by 470.27 points or 2.26% to 21,236.37.