Bulls rejuvenate on Dalal Street as exit polls suggest NDA’s return

Bulls rejuvenated on Dalal Street and Indian equity benchmarks made a gap-up opening with frontline gauges recapturing their crucial 38,600 (Sensex) and 11,600 (Nifty) levels in early deals, as exit polls of the 2019 Lok Sabha elections projected BJP-led National Democratic Alliance (NDA) to win a comfortable majority. Besides, investors will be looking forward the outcome of 17th Lok Sabha election on May 23. Further, Sentiments remained upbeat with the Reserve Bank of India’s (RBI) data showing that the country's foreign exchange reserves rose by $1.368 billion to reach $420.055 billion in the week to May 10 on account of a rise in foreign currency assets. In the previous week, the reserves had increased by $171.9 million to $418.687 billion. Traders took note of report that the GST Council is likely to consider next month a proposal for setting up a national bench of the Appellate Authority for Advance Ruling (AAAR) to reconcile the contradictory orders on similar issues passed by AARs in different states, a move aimed at providing certainty to taxpayers.

On the global front, the US markets settled lower on Friday as worries over US-China trade relations more than offset strong consumer data and other more conciliatory trade developments. However, Asian Markets are trading mostly in green on Monday despite media reports that US-China trade talks have stalled.

Back home, traders shrugged off Economic Advisory Council to the Prime Minister (EAC-PM) member Shamika Ravi’s statement that India needs to make all efforts to reach double digit growth and should not treat 7 percent expansion as the new normal. In scrip specific developments, Torrent Pharmaceuticals gained on raising Rs 100 crore via CPs and PNC Infratech surged with its arm receiving final realization of arbitration award.

The BSE Sensex is currently trading at 38627.52, up by 696.75 points or 1.84% after trading in a range of 38570.04 and 38892.89. 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 2.07%, while Small cap index was up by 1.86%.

The top gaining sectoral indices on the BSE were Energy up by 3.21%, Capital Goods up by 3.18%, Realty up by 3.17%, PSU up by 3.00% and Oil & Gas was up by 2.92%, while IT down by 0.45% and TECK down by 0.30% were the only losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 4.26%, Maruti Suzuki up by 4.17%, SBI up by 4.04%, ICICI Bank up by 3.93% and Reliance Industries was up by 3.32%. On the flip side, Bajaj Auto down by 2.09%, Infosys down by 1.26% and HCL Tech was down by 0.32% were the few losers.

Meanwhile, India Meteorological Department (IMD) in its latest report has indicated that pre-monsoon rainfall in the country from March to May recorded a deficiency. Pre-monsoon rainfall is a phenomenon vital to agriculture in several parts of the country. The IMD recorded 75.9 millimetres of rainfall from March 1 to May 15 as against the normal rainfall of 96.8 millimetres, which comes to around minus 22%. The deficiency this week seems to have fallen over the last fortnight due to rains over east and northeast India. Besides, from March 1 to April 24, the IMD recorded a deficiency of 27%. It added that the southwest monsoon has advanced into South Andaman Sea and conditions are favourable for it to reach the North Andaman Sea and the Andaman Islands in the next 2-3 days.

Of the four meteorological divisions of the IMD, the south peninsula, which comprises all the southern states, has recorded pre-monsoon deficiency of 46%, the highest in the country. This was followed by 36% in the northwest subdivision that covers all the north Indian states - it was 38% from March 1 to April 24, but has dropped by 2% due to rainfall across several parts. The deficiency in the east and northeast region that covers eastern states of Jharkhand, Bihar, West Bengal, Odisha and northeastern states was seven per cent. There was no deficiency in the central region which comprises states of Maharashtra, Goa, Chhattisgarh, Gujarat and Madhya Pradesh.

However, from March 1 to April 24 the pre-monsoon rainfall recorded in the central division was 5% than normal. The region has also been witnessing intense heat waves and several dams in the Marathwada region of Maharashtra have reached zero storage level. Pre-monsoon rainfall is important for horticulture crops in some parts of the country. In states like Odisha, ploughing is done in the pre-monsoon season, while in parts of northeast India and the Western Ghats it is critical for plantation of crops.

The CNX Nifty is currently trading at 11623.05, up by 215.90 points or 1.89% after trading in a range of 11591.70 and 11694.10. There were 44 stocks advancing against 6 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing up by 5.22%, Maruti Suzuki up by 4.44%, SBI up by 4.37%, Larsen & Toubro up by 4.26% and Ultratech Cement was up by 4.26%. On the flip side, Dr. Reddys Lab down by 2.87%, Zee Entertainment down by 2.50%, Bajaj Auto down by 1.53%, Tech Mahindra down by 1.53% and Infosys was down by 1.24% were the top losers.

Asian Market are trading mostly in green; Nikkei 225 surged 70.79 points or 0.33% to 21,320.88, Jakarta Composite soared 44.90 points or 0.77% to 5,871.77, Taiwan Weighted strengthened 21.37 points or 0.21% to 10,405.48 and KOSPI was up by 11.68 points or 0.57% to 2,067.48. On the flip side, Shanghai Composite declined 17.05 points or 0.59% to 2,865.25 and Hang Seng was down by 119.14 points or 0.43% to 27,827.32.