Benchmarks trade with jubilation in early deals

Indian equity benchmarks made a gap-up opening and are trading jubilantly in early deals ahead of macro-economic data of industrial production and consumer price inflation to be released after the market hours. Traders took some support with Industry body CII’s statement that the appointment of former bureaucrat Shaktikanta Das as the new Reserve Bank of India (RBI) Governor comes as a huge sentiment booster to the industry and expressed confidence that he will take urgent steps to address the liquidity squeeze in economy. Das was appointed as the new governor of the RBI, a day after his predecessor Urjit Patel’s resignation. Moreover, CII said that the government should consider permitting 100% foreign direct investment (FDI) in multi-brand retail trade and further improve ease of doing business for the sector to promote growth in the segment.

Global cues too remained supportive with all the Asian markets are trading in green at this point of time following positive signs on the outlook for US-China trade talks. The US markets ended Tuesday’s volatile session mostly in red as investors weighed mounting political tension in the nation’s capital.

Back home, stocks related to renewable energy (RE) sector remained in focus with rating agency ICRA expecting a capacity addition of 10,000 MW in fiscal year 2020, and has maintained a stable outlook for the sector. The share of renewable energy in the generation mix has increased from 5.6% in FY2015 to 7.8% in FY2018. Construction sector stocks remained in limelight with CARE Ratings’ report that the pace of the construction sector is set to face a decline in FY20 on funding shortage for new projects.

The BSE Sensex is currently trading at 35481.96, up by 331.95 points or 0.94% after trading in a range of 35167.47 and 35484.62. There were 28 stocks advancing against 3 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index surged 1.33%, while Small cap index was up by 1.48%.

The top gaining sectoral indices on the BSE were Auto up by 2.03%, Realty up by 2.03%, Telecom up by 1.86%, Industrials up by 1.51% and Capital Goods up by 1.46%, while there were no losers on the BSE sectoral front.

The top gainers on the Sensex were Yes Bank up by 4.28%, Hero MotoCorp up by 3.87%, Kotak Mahindra Bank up by 3.00%, Bharti Airtel up by 2.84% and Mahindra & Mahindra up by 2.46%. On the flip side, Coal India down by 0.43%, Asian Paints down by 0.15% and Reliance Industries down by 0.10% were the top losers.

Meanwhile, in order to promote growth in multi-brand retail trade, industry body the Confederation of Indian Industry (CII) in its latest report has stated that the government should consider permitting 100% foreign direct investment (FDI) in multi-brand retail trade and further improve ease of doing business for the sector. With an aim to overcome the barriers and enable a smooth growth and harmonious coexistence of traditional and modern retail, the industry body said the government needs to adopt a single cohesive national retail policy, which adequately addresses all the concern areas.

The report further said the government should encourage modernisation of traditional retail by subsidising these retailers to adopt technology. It added that improved access to capital will help retail business especially the traditional retailers. It said that with a simplified, cohesive policy and a focused effort on modernising traditional retail sector, government can create multiple wins such as higher growth of the sector, larger traditional retail stores under regulatory compliance, and improved back-end efficiency with a lower overall cost to serve. So far, only one foreign player, Tesco, had received approval for opening stores under the multi-brand retail policy.

This recommendation is a part of CII’s national retail policy, which was jointly prepared by the industry chamber and AT Kearney. The policy has suggested several steps, including strengthening labour laws by regularising policies around part-time labour to ensure greater participation of women in the workforce; and review of food safety policies to update archaic laws governing stocking limits, weights and measures, labeling, and taxes on expired food items. It also asked for decreasing real estate constraints for retail expansion by creating dedicated retail special economic zones as well as simplify regulations and real estate approvals for kiranas to expand their stores.

The CNX Nifty is currently trading at 10649.10, up by 99.95 points or 0.95% after trading in a range of 10560.80 and 10651.40. There were 43 stocks advancing against 7 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing up by 5.85%, Yes Bank up by 4.13%, Hero MotoCorp up by 3.61%, Kotak Mahindra Bank up by 2.87% and Bharti Airtel up by 2.62%. On the flip side, Dr. Reddys Lab down by 0.97%, Titan Company down by 0.71%, HPCL down by 0.59%, Coal India down by 0.48% and BPCL down by 0.44% were the top losers.

All the Asian markets are trading in green; Nikkei 225 soared 418.93 points or 1.98% to 21,566.95, Straits Times gained 26.77 points or 0.88% to 3,086.05, Hang Seng surged 397.68 points or 1.54% to 26,169.35, Taiwan Weighted jumped 73.92 points or 0.76% to 9,780.96, KOSPI advanced 23.17 points or 1.13% to 2,076.14, Jakarta Composite added 23.65 points or 0.39% to 6,100.24 and Shanghai Composite was up by 5.07 points or 0.20% to 2,599.16.