Local equities continue firm trade in morning deals

Local equity markets continued firm trade in the morning session on account of buying in front line counters. High beta indices like IT, FMCG and Energy were, as usual, inched higher with the up-move on the benchmarks. Traders remain encouraged with Reserve Bank of India study which showed that Private sector non-finance firms reported a 41 per cent growth in net profits during the July-September quarter, despite higher expenditure as other income contributed to growth. Market participants also took note of a private report that the government has extended deadline to submit global revenues, profit and sales to the taxman by three months. The multinationals were first required to submit the details by December 31, but instead they would now be required to do so by March end next year. Traders were energized with a private report stating that with global crude oil prices slumping to below $50 a barrel just months after crossing $86, the Prime Minister Narendra Modi-led government is now confident that the current account deficit (CAD) for 2018-19 (FY19) can be contained at about 2 per cent of gross domestic product (GDP).

On the global front, Asian markets were trading in green, following the overnight rally on Wall Street, which recorded its best performance in nine years, and the sharp rebound in crude oil prices. Data showing strong consumer spending in the US and easing worries about the tenure of Federal Reserve Chairman Jerome Powell lifted investor sentiment. Back home, on the sectoral front, steel sector stock were in focus, as India has challenged the WTO dispute panel's ruling that the country's move to impose safeguard duty on some iron and steel products was inconsistent with certain global trade norms.

The BSE Sensex is currently trading at 35924.55, up by 274.61 points or 0.77% after trading in a range of 35823.73 and 36041.24. 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 0.35%, while Small cap index was up by 0.72%.

The top gaining sectoral indices on the BSE were IT up by 2.03%, TECK up by 1.76%, Energy up by 0.98%, FMCG up by 0.66% and Realty was up by 0.57% while, Power down by 0.27%, Telecom down by 0.13%, Utilities down by 0.11% and PSU was down by 0.03% were the top losing indices on BSE.

The top gainers on the Sensex were Infosys up by 2.51%, TCS up by 2.19%, Reliance Industries up by 1.74%, IndusInd Bank up by 1.68% and HCL Tech was up by 1.64%. On the flip side, Power Grid down by 0.94%, Bharti Airtel down by 0.73%, Kotak Mahindra Bank down by 0.33%, NTPC down by 0.31% and Hero MotoCorp was down by 0.30% were the top losers.

Meanwhile, Reserve Bank of India (RBI) in its latest report has said that Manufacturing sector, particularly textile and iron and steel segments, maintained its pace of sales growth in the second quarter of current financial year (Q2FY19) as compared to the year-ago period.  RBI said that companies in manufacturing sector posted a net profit of Rs 47,100 crore in the reported quarter, up 29.4% from the same period last year. The data was based on abridged financial results of 1,734 companies in the manufacturing sector.

It further stated that the manufacturing sector sales growth was mainly supported by robust demand conditions in chemical and chemical products, iron and steel, and petroleum products industries coupled with significant improvement recorded by textile industry. Meanwhile, the information technology (IT) sector recorded further improvement in sales growth over the year-ago period. The profit of IT sector, based on data of 172 firms, was Rs 17,700 crore in the second quarter of current financial year, up 5.8% over the July-September period of 2017-18.

However, it showed heavy moderation was seen in the sales growth of motor vehicles and other transport equipment, driven in part by a large adverse base effect, and pharmaceutical and medicine industries. On expenditure front, It underlined manufacturing companies continued to face rising input cost (cost of raw materials, staff cost) pressures. In case of IT sector, staff costs accelerated in tandem with the improvement in sales growth.

The CNX Nifty is currently trading at 10805.00, up by 75.15 points or 0.70% after trading in a range of 10773.90 and 10824.80. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Tech Mahindra up by 2.62%, Infosys up by 2.30%, TCS up by 2.02%, Hindalco up by 1.90% and IndusInd Bank was up by 1.75%. On the flip side, BPCL down by 2.07%, HPCL down by 1.31%, Indian Oil Corporation down by 0.82%, Power Grid down by 0.67% and NTPC was down by 0.55% were the top losers.

All Asian markets were trading in green, Nikkei 225 surged 834.59 points or 4.32% to 20,161.65, Hang Seng increased 111.17 points or 0.43% to 25,762.55, Taiwan Weighted strengthened 185.46 points or 1.96% to 9,664.45, KOSPI rose 0.60 points or 0.03% to 2,028.61, Shanghai Composite gained 14.06 points or 0.56% to 2,512.35, Straits Times advanced 58.78 points or 1.95% to 3,069.93 and Jakarta Composite was up by 43.37 points or 0.71% to 6,171.22.