Key indices add gains in early noon deals

The local barometer gauges added some gains and continued their trade in green in early afternoon session, on buying by investors ahead of earnings season, scheduled to begin this week. Sentiments remained up-beat with the World Economic Situation and Prospects 2018 report of the United Nations, which enlightened that the Indian economy is projected to grow at 7.2% in 2018-19 and 7.4% in 2019-20. The report indicates that the outlook for India remains largely positive, underpinned by robust private consumption and public investment as well as ongoing structural reforms. Traders overlooked report that inflows into Indian equity funds in March were the smallest in 13 months as some investors sold before a tax on stock holdings took effect from April 1 and volatility returned to markets worldwide. Equity funds took in a net Rs 66.57 billion ($1 billion), the least since last February. The gains at Dalal Street were mainly led by Consumer Durables, Oil & Gas and Energy sector stocks. In scrip specific development, Inox Wind was up by over half a percent on winning 100 MW in the SECI-4 auction maintaining its successful track record in central government auctions.

On the global front, Asian markets were trading in green, on easing concerns about a sharp rise in US interest rates and buying by investors ahead of earnings season, scheduled to begin this week, helped lift market sentiment. Back home, the BSE Sensex is currently trading at 33814.72, up by 187.75 points or 0.56% after trading in a range of 33578.91 and 33817.11. There were 20 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.27%, while Small cap index was up by 0.54%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.93%, Oil & Gas up by 1.61%, Energy up by 1.07%, Capital Goods up by 0.92% and FMCG up by 0.87%, while TECK down by 0.62%, IT down by 0.57% and Telecom down by 0.23% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 2.09%, Mahindra & Mahindra up by 1.95%, ITC up by 1.63%, Axis Bank up by 1.56% and Asian Paints up by 1.42%. On the flip side, Infosys down by 1.63%, Tata Motors down by 1.03%, Tata Motors - DVR down by 1.02%, Bharti Airtel down by 0.88% and ICICI Bank down by 0.29% were the top losers.

Meanwhile, suggesting better measures for the devolution of funds to states, NITI Aayog Vice Chairman Rajiv Kumar has pointed out the need for building ‘performance indicators’. He said that devolution of funds criteria has to include some performance based criteria and therefore those states which have done better in certain performance should not be punished. His statement came in the backdrop of some states expressing disquiet about the Terms of Reference of the 15th Finance Commission to decide the sharing of tax resources between the Centre and states.

Kumar pointed out that fiscal irresponsibility is bad but fiscal fetish is also not good and a balance must be maintained. He highlighted that the country is entering a new era of much larger fiscal space because of the Goods and Services Tax (GST) and buoyancy in direct tax collection. He also urged to the industry body to come up with new formula for enhancing growth and added that macro-economic policy in India needs to be counter-cyclical. He said that while the Fiscal Responsibility and Budget Management Act did have a role to play in discouraging short-term populist measures and promoted fiscal discipline, there was also no need to be concerned about borrowing that finances long term capital expenditure. He also pointed out that certain expenditures such as those for health and education could be viewed as capital expenditure as they promote productivity gains in the long run.

Besides, Rajiv Kumar added that NITI Aayog was in favour of recommending to the 15th Finance Commission to consider Sustainable Development Goals (SDG) performance for allocating a small percentage of funds to different states. But unfortunately they found that if the government uses SDG performance criteria for funds devolution to the states, then it is the more backward states or populated states that will lose some of their allocations and that would be politically harmful. 

The CNX Nifty is currently trading at 10393.90, up by 62.30 points or 0.60% after trading in a range of 10328.50 and 10396.20. There were 34 stocks advancing against 15 stocks declining on the index, while 1 stock remained unchanged.

The top gainers on Nifty were HPCL up by 4.14%, BPCL up by 4.02%, Indian Oil Corporation up by 3.36%, Hindalco up by 3.34% and Titan Co up by 2.86%. On the flip side, Infosys down by 1.40%, Zee Entertainment down by 1.28%, Tata Motors down by 1.00%, Bharti Airtel down by 0.79% and GAIL India down by 0.70% were the top losers.

The Asian markets were trading in green; Shanghai Composite increased 2.19 points or 0.07% to 3,133.30, FTSE Bursa Malaysia KLCI was up by 9.77 points or 0.53% to 1,846.78, KOSPI Index added 14.5 points or 0.6% to 2,444.08, Jakarta Composite rose 40.68 points or 0.66% to 6,215.73, Taiwan Weighted inched up 72 points or 0.67% to 10,893.53, Nikkei 225 increased 110.74 points or 0.51% to 21,678.26 and Hang Seng surged 387.25 points or 1.3% to 30,232.19.