Firm trade persists on Dalal Street

Key barometer gauges continued their firm trade in afternoon session on the back of positive trade in Asian equities coupled with sustained buying by domestic institutional investors. Domestic sentiments remained firm with a report that manufacturing activity in India improved at a 14-month high in February, accelerated by an increase in sales which fuelled growth of output and employment. The Nikkei India Manufacturing Purchasing Managers’ Index (PMI) rose to 54.3 in February, up from 53.9 in January. Some optimism also came in with Moody's report stating that the Indian economy is expected to grow at 7.3 per cent in calendar year 2019 and 2020, and the government spending announced ahead of elections this year will support near-term growth. However, further up move got restricted as anxiety remained among the local traders with Labour Ministry’s statement that retail inflation for industrial workers rose to 6.6 percent in Janurary 2019 on account of higher prices of certain food items. On the sectoral front, textile sector remained in limelight after the Union Minister Smriti Irani launched a scheme for development of knitting and knitwear sector under PowerTex India, which will be in operation up to March 31, 2020. The two primary components of the scheme are creation of new service centres and modernisation and upgradation of existing service centres.

On the global front, Asian markets were trading in green, after a report suggested that the leaders of China and the U.S. could be endorsing a trade deal in weeks. Back home, the BSE Sensex is currently trading at 36018.92, up by 151.48 points or 0.42% after trading in a range of 36008.39 and 36140.67. There were 26 stocks advancing against 5 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 1.02%, while Small cap index was up by 1.54%.

The top gaining sectoral indices on the BSE were Metal up by 1.49%, PSU up by 1.29%, Basic Materials up by 1.22%, Power up by 1.18% and Utilities up by 1.17%, while Telecom down by 1.19%, Realty down by 0.33% and Consumer Durables down by 0.05% were the few losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 2.24%, Vedanta up by 2.21%, Yes Bank up by 1.84%, Hero MotoCorp up by 1.71% and Coal India up by 1.47%. On the flip side, Bharti Airtel down by 3.24%, Axis Bank down by 0.49%, Asian Paints down by 0.41%, Reliance Industries down by 0.25% and Tata Motors down by 0.20% were the top losers.

Meanwhile, Finance Minister Arun Jaitley has expressed hopes that the remaining six public sector banks (PSBs) under the Reserve Bank of India’s (RBI) prompt corrective action (PCA) framework will soon come out of it with the government commitment of support to them. He said that the Insolvency and Bankruptcy Code (IBC) has been a success story and the government has maintained arm's length distance from the processes being followed.

The minister stated that the norms of banking have changed and now decisions are based on merit and professionalism. He said “I'm conscious of the fact that you (public sector banks) are working in a competitive environment and you are still bound by certain restriction. Your public and social responsibility is much higher than your private sector competitors”. He also asked the PSBs lenders to consider themselves independent while discharging their professional and commercial functions.

Talking about the IBC, Jaitley said that any instance of interference from the government in the process would discredit the whole process and bring a bad name to the wonderful reform. He said “IBC everybody concedes has been a success story and it helped bring back Rs 2.85 lakh crore into the banking system ... In an evolving society there is desire to become more ethical. Of course, the carrot part also worked that you can't be a fugitive and get away with it. There is a law dealing with them.”

The CNX Nifty is currently trading at 10841.90, up by 49.40 points or 0.46% after trading in a range of 10837.05 and 10871.60. There were 38 stocks advancing against 12 stocks declining on the index.

The top gainers on Nifty were Adani Ports &SEZ up by 2.53%, Vedanta up by 2.27%, Indusind Bank up by 2.24%, Zee Entertainment up by 2.21% and HPCL up by 1.88%. On the flip side, Bharti Airtel down by 3.02%, Cipla down by 0.82%, Dr. Reddys Lab down by 0.75%, Axis Bank down by 0.69% and UPL down by 0.58% were the top losers.

Asian markets were trading in green; Nikkei 225 surged 217.53 points or 1.02% to 21,602.69, Hang Seng increased 145.30 points or 0.51% to 28,778.48, Jakarta Composite soared 55.63 points or 0.86% to 6,498.98, Straits Times advanced 8.50 points or 0.26% to 3,221.19 and Shanghai Composite gained 26.88 points or 0.91% to 2,967.83.