Benchmarks trade in fine fettle in morning deals

Indian equity benchmarks made an optimistic start and are trading in fine fettle in early deals on Monday, with frontline gauges recapturing their crucial 35,000 (Sensex) and 10,650 (Nifty) levels, as oil extended a steep decline in the previous session, helping ease recent fears over inflation, current account and fiscal deficits. Traders took some encouragement with Industry chamber CII’s statement that businesses across several key sectors are seeing firm growth in sales and orders, indicating that the economy is on a recovery path and investments will pick up. CII said the impact of sustained structural reforms is now being felt on the ground as a mammoth economy is turning around. Some support also came with CARE Ratings’ report stating the country’s industrial output is expected to log five to six per cent growth in this fiscal, bettering 4.3 per cent growth rate clocked in the previous fiscal.

On the global front, Asian markets are trading mostly in green in early deals, as investors digested the latest developments regarding North Korea and Italian politics. The US markets ended mostly lower on Friday, as investors kept an eye on geopolitical headlines. After President Donald Trump called off a June 12 summit with North Korea, a senior official from Pyongyang said its leader Kim Jong Un is still willing to meet.

Back home, a private report said India’s economy may have expanded by 7.1-7.5% in the January-March quarter - driven by manufacturing and construction - compared with 7.2% in the third quarter. Meanwhile, the finance ministry is planning to set up a fund under the National Investment and Infrastructure Fund (NIIF) dedicated for strategic investments. In scrip specific development, PNC Infratech firmed up on emerging lowest bidder for project worth Rs 1,157 crore and Sun Pharma strengthened on reporting 7% rise in Q4 consolidated net profit.

The BSE Sensex is currently trading at 35084.60, up by 159.73 points or 0.46% after trading in a range of 35006.50 and 35106.85. There were 23 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.51%, while Small cap index up by 0.79%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 2.31%, PSU up by 1.73%, Healthcare up by 1.50%, Energy up by 1.14% and Capital Goods was up by 1.05%, while IT down by 1.04%, TECK down by 0.80% and Consumer Durables was down by 0.42% were the few losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 5.80%, Coal India up by 1.79%, Maruti Suzuki up by 1.14%, ICICI Bank up by 1.11% and Larsen & Toubro up by 1.10%. On the flip side, TCS down by 1.32%, Tata Motors - DVR down by 0.58%, Indusind Bank down by 0.56%, Power Grid Corporation down by 0.31% and Wipro down by 0.28% were the top losers.

Meanwhile, expressing optimism on the India’s economic growth, the industry body, Confederation of Indian Industry (CII) has said that the Indian economy is on a recovery path and investments will pick up. It also expects that the country to record growth of 7.3-7.7% in 2018-19. It added that growth will be aided by several major development campaigns such as Make in India, Digital India, Swachh Bharat, Clean Energy and others gaining traction, as well as recovery in the global economy and expectations of a normal monsoon.

On the sectoral front, the industry body said that sectors like consumer non-durables, two-wheelers and tractors are witnessing strong rural consumption, as prudent macroeconomic management has encouraged growth and investments for capacity expansion are being planned as demand conditions recover. Besides, the capital goods sector is showing steady improvement and order books are filling up. Exports, too, are poised to grow at a faster pace in the current fiscal year, which started on a good note. It also said that the government has avoided slippage in the fiscal deficit despite the rise in oil prices. Inflation too has remained under control to the extent possible even as cost of oil is going up.

CII highlighted eight key areas where reform measures have unlocked growth forces, that  includes India’s biggest reform Goods and Services Tax (GST), emphasis on ease of doing business, Insolvency and Bankruptcy Code, liberalisation in foreign direct investment (FDI) policy and high infrastructure spending. Moreover, CII President Rakesh Bharti Mittal has said that the impact of sustained structural reforms is now being felt on the ground as a mammoth economy is turning around. He added that businesses across several key sectors are experiencing firm growth in sales and orders, indicating better capacity utilisation and higher investment expectations.

The CNX Nifty is currently trading at 10660.95, up by 55.80 points or 0.53% after trading in a range of 10640.55 and 10673.10. There were 38 stocks advancing against 12 stocks declining on the index.

The top gainers on Nifty were Sun Pharma up by 5.91%, BPCL up by 5.74%, Indian Oil up by 5.72%, HPCL up by 4.78% and GAIL India up by 2.57%. On the flip side, Tech Mahindra down by 4.59%, HCL Tech down by 1.39%, TCS down by 1.24%, Bajaj Finance down by 1.18% and Zee Entertainment down by 1.03% were the top losers.

Asian markets are trading mostly in green; Shanghai Composite increased 5.55 points or 0.18% to 3,146.85, KOSPI Index gained 19.35 points or 0.79% to 2,480.15, Nikkei 225 jumped 35.01 points or 0.16% to 22,485.80, Taiwan Weighted rose 43.99 points or 0.4% to 10,986.29, Jakarta Composite added 64.49 points or 1.08% to 6,040.23 and Hang Seng up by 170.45 points or 0.56% to 30,758.49. 

On the flip side, FTSE Bursa Malaysia KLCI was down by 11.15 points or 0.62% to 1,786.25.