Local equities continue to trade in green zone

Local equity benchmarks continued their trade in positive territory in morning session, with Sensex and Nifty gaining more than 190 and 60 points, respectively. Traders took support with the industry body FICCI’s survey report that the country’s median GDP is forecast at 7.1 per cent for FY20 and 7.2 per cent for FY 21. The industry body FICCI’s economic outlook survey said the minimum and maximum growth estimate stood at 6.8 per cent and 7.3 per cent, respectively, for 2019-20. Sentiments also remain encouraged with a report that the Prime Minister Narendra Modi-led government's new Cabinet will infuse renewed vigour in India's economy with landmark reforms on the back of a decisive mandate as the country aims to become a global economic power house. Traders took note of a report that US-based India-centric business advocacy and strategic group has sought establishing an India Trade Representative under the Prime Minister’s Office for all international trade negotiations to be handled by one office with a focused approach. Besides, rating agency ICRA stated that transport infrastructure which remains a key focus area for the new government is likely to see a major jump in capital allocation to around Rs 25-30 trillion in the next five years.

On the global front, Asian markets were trading mixed, after President Donald Trump said the United States will impose a 5% tariff on all Mexican imports. Besides, Trump administration has said it is not going back on its decision to terminate India’s designation as a beneficiary developing nation under the key GSP trade programme, terming the suspension a ‘done deal’.

The BSE Sensex is currently trading at 40023.42, up by 191.45 points or 0.48% after trading in a range of 39941.19 and 40122.34. There were 23 stocks advancing against 7 stocks declining, while 1 stock remain unchanged on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.65%, while Small cap index was up by 0.10%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.22%, IT up by 0.86%, TECK up by 0.84%, Consumer Disc up by 0.80% and Energy was up by 0.72% while, Metal down by 0.53%, Basic Materials down by 0.36%, Power down by 0.18% and Utilities was down by 0.05% were the top losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 3.29%, Coal India up by 2.23%, TCS up by 1.55%, HCL Tech. up by 1.53% and Maruti Suzuki was up by 1.07%. On the flip side, Vedanta down by 1.86%, Tata Steel down by 0.48%, Tata Motors down by 0.40%, ONGC down by 0.24% and Yes Bank was down by 0.16% were the top losers.

Meanwhile, indicating that transport infrastructure sector is likely to get the largest chunk of investment in coming time, rating agency ICRA has said transport infrastructure, which remains a key focus area for the new government, may see a major jump in capital allocation to around Rs 25-30 trillion in the next five years. Taking cues from the Bharatiya Janata Party (BJP) manifesto, ICRA expected that transport infrastructure (roads, railways, metro, airport, ports, inland waterway, etc.) to remain the main focus area for the new government.

ICRA’s Vice-President and Group Head, Corporate Ratings, Shubham Jain stated the capital investment in the infrastructure sector has been proposed at Rs 100 trillion over the next five years - which is a huge increase from the current level of capital investment in the sector. Jain further said that such an investment would provide tremendous long-term benefits for the Indian economy. The construction companies are likely to be the major beneficiaries and will witness strong order inflows, estimated between Rs 15-18 trillion on the basis of these infrastructure capex plans.

The new government is likely to maintain the continuity on the major programmes launched during its last tenure, including Bharatmala Pariyojana, Sagarmala and UDAN among others. The last five-year--FY14 to FY19-- had witnessed huge spending by the government on infrastructure segments like roads, railways, metro and rail which is likely to increase further over the next five years.

The CNX Nifty is currently trading at 12013.25, up by 67.35 points or 0.56% after trading in a range of 11985.25 and 12039.25. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Asian Paints up by 3.59%, Indian Oil Corp. up by 3.18%, Tech Mahindra up by 2.55%, BPCL up by 2.51% and Britannia Industries was up by 2.00%. On the flip side, Grasim Industries down by 1.91%, Vedanta down by 1.83%, Hindalco down by 1.03%, Yes Bank down by 0.84% and JSW Steel was down by 0.65% were the top losers.

Asian markets were trading mixed; Taiwan Weighted strengthened 107.23 points or 1.03% to 10,490.22, Jakarta Composite soared 55.96 points or 0.92% to 6,160.07, KOSPI rose 3.96 points or 0.19% to 2,042.76 and Shanghai Composite was up by 0.20 points or 0.01% to 2,906.01.

On the other hand; Straits Times trembled 17.65 points or 0.56% to 3,125.35, Hang Seng decreased 68.13 points or 0.25% to 27,046.75 and Nikkei 225 was down by 275.03 points or 1.31% to 20,667.50.