Local equities continue rally in morning session

Local equity benchmarks continued their upward rally in morning session, with Sensex and Nifty gaining more than 300 and 90 points, respectively. Barring Telecom stocks, there was buying across all sectoral indices. Among heavy-weights Tata Steel, Kotak Mahindra Bank and Power Grid exhibited a smart performance. Traders remain encouraged with Reserve Banks report that it will infuse Rs 12,500 crore of liquidity into the system through purchase of government bonds (G-sec). The Central bank would purchase five government bonds under open market operations (OMOs) on June 20, 2019. Traders also took note of a report that Reserve Bank sets up an eight-member expert committee to review the current framework for the MSME sector. The committee will suggest long-term solutions for the economic and financial sustainability of the micro, small and medium enterprises. Beside, a report stated that Prime Minister Narendra Modi will interact with leading economists and experts on June 22 to deliberate on economic policy roadmap for promoting growth and employment generation. The meeting, being organised by government think tank NITI Aayog, will be attended by various ministers, NITI Aayog functionaries, leading economists, sectoral experts and industrialists.

On the global front, Asian markets were trading in green, following positive developments overnight on the US-China trade front. Back home, rating agency ICRA reported that wind energy generation capacity addition is likely to improve to 3.5-4.0 GW this fiscal, while land acquisition and transmission connectivity challenges will remain crucial. The rating agency expects wind power capacity addition to increase to about 3.5 to 4 GW in FY2020.

The BSE Sensex is currently trading at 39372.37, up by 326.03 points or 0.83% after trading in a range of 39158.10 and 39435.80. There were 24 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.43%, while Small cap index was up by 0.20%.

The top gaining sectoral indices on the BSE were Realty up by 1.76%, Metal up by 1.62%, Capital Goods up by 0.90%, BANKEX up by 0.90% and Consumer Durables was up by 0.85%, while Telecom was down by 0.36% was the only losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 3.54%, Kotak Mahindra Bank up by 1.84%, Tata Motors - DVR up by 1.43%, Power Grid up by 1.39% and Axis Bank was up by 1.38%. On the flip side, Yes Bank down by 1.10%, Hero MotoCorp down by 0.70%, Coal India down by 0.60%, HCL Tech down by 0.31% and Bharti Airtel was down by 0.27% were the top losers.

Meanwhile, ICRA in its latest report has said that wind energy generation capacity addition may improve to 3.5-4.0 GW in current financial year (FY20), while land acquisition and transmission connectivity challenges will remain crucial. Improvement in wind power capacity addition will be mainly on account of large project awards by the nodal agencies and measures being taken to address some of the key challenges.

It highlighted that since February 2017, the overall wind power capacity awarded by the central nodal agencies and the state distribution utilities has been sizeable at more than 12 GW, providing a visibility for substantial capacity addition. However, it said the actual execution on the ground has been slow with only 1.6 GW added in last financial year (FY19), owing to delays in execution caused by land acquisition issues and securing transmission connectivity.

It further mentioned that the government initiated certain measures towards resolving the issues faced by the developers, such as offering incentives in the form of facilitation charge to state governments providing support for land acquisition and investments towards augmenting inter-state transmission infrastructure. Besides, the tariff discovered in the recent wind power auctions continue to remain at less than Rs 3 per unit. The average bid tariff declined from Rs 3.01 per unit in CY17 (calendar year) to Rs 2.64 per unit in CY 2018.

The CNX Nifty is currently trading at 11784.95, up by 93.45 points or 0.80% after trading in a range of 11740.20 and 11802.50. There were 36 stocks advancing against 13 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Tata Steel up by 3.67%, Hindalco up by 2.63%, Indiabulls Housing up by 2.40%, Zee Entertainment up by 2.31% and Kotak Mahindra Bank was up by 1.91%. On the flip side, Indian Oil Corporation down by 1.11%, Yes Bank down by 1.05%, Wipro down by 0.94%, Bharti Infratel down by 0.87% and Hero MotoCorp was down by 0.70% were the top losers.

All Asian markets were trading in green; Hang Seng increased 668.31 points or 2.43% to 28,167.08, Nikkei 225 surged 373.67 points or 1.78% to 21,346.38, Taiwan Weighted strengthened 156.63 points or 1.48% to 10,723.37, Jakarta Composite soared 53.68 points or 0.86% to 6,311.01, Shanghai Composite gained 43.48 points or 1.5% to 2,933.64, Straits Times advanced 41.24 points or 1.27% to 3,279.97 and KOSPI was up by 26.21 points or 1.25% to 2,124.92.