Local equities add gains to trade in fine fettle

Local equity benchmarks have extended their gains to trade in fine fettle in morning session due to increased buying by funds. Axis Bank, IndusInd Bank and Mahindra & Mahindra were the prime gainers among heavy-weights, pushing the Sensex higher. Traders remain energized with a report that the US President Donald would meet Prime Minister Narendra Modi on the sidelines of the G-20 Summit. This would be his first meeting with Modi after his recent electoral victory. The markets took support from Arvind Panagariya’s statement that the escalating trade war between the US and China is an opportune time for India to attract the large multinationals looking for alternative locations outside the Communist country. Traders also took note of a report that US has taken a ‘unilateral position’ in rolling back export incentives from India, the government asserted that it would not allow trade negotiations to overtake issues of national interest. However, market participants ignored a report that the cumulative debt of the National Highway Authority of India (NHAI) has mounted to Rs 1.78 lakh crore in FY19 from around Rs 40,000 crore in FY14. The borrowing is expected to go up to Rs 3.31 lakh crore by FY23.

On the global front, Asian markets were trading in green as investors brushed off Donald Trump's latest dig at China and threat to impose more tariffs on the country's goods if crunch talks with Xi Jingping fail this weekend. Back home, Telecom Minister Ravi Shankar Prasad stated that foreign direct investment in the Indian telecom sector dropped by around 43 per cent to $2.6 billion in fiscal year 2018-19. He added that the quantum and nature of FDI inflows depend on many factors and accordingly no specific reasons can be attributed for increase or decrease of inflows on year-to-year basis.

The BSE Sensex is currently trading at 39740.35, up by 148.27 points or 0.37% after trading in a range of 39633.88 and 39757.41. There were 21 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.21%, while Small cap index was up by 0.76%.

The top gaining sectoral indices on the BSE were Realty up by 1.61%, Auto up by 1.11%, Bankex up by 0.72%, Capital Goods up by 0.72% and Industrials was up by 0.70%, while Energy down by 0.22%, Metal down by 0.05% and IT was down by 0.01% were the few losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 1.84%, Tata Motors - DVR up by 1.78%, IndusInd Bank up by 1.55%, Mahindra & Mahindra up by 1.52% and Tata Motors was up by 1.43%. On the flip side, Tech Mahindra down by 1.62%, Power Grid down by 1.02%, Yes Bank down by 0.84%, Reliance Industries down by 0.68% and HCL Tech was down by 0.59% were the top losers.

Meanwhile, Telecom Minister Ravi Shankar Prasad has said foreign direct investment (FDI) in the Indian telecom sector declined by around 43 percent to $2.6 billion in last financial year (FY19). The FDI equity inflow in the FY18 was $6,211.84 million whereas the FDI equity inflow in the FY19 was $2,667.91 million.

He stated that the quantum and nature of FDI inflows depend on many factors and accordingly no specific reasons can be attributed for increase or decrease of inflows on year-to-year basis. He further said that there has been neither a regulatory uncertainty nor the lack of conducive environment to invest in the telecom sector which may be cited as a reason for the year-to-year decline in FDI. Stressed financial conditions, if any, cannot be held responsible for year-to-year decline.

Besides, he said the telecom sector is facing financial stress due to stiff competition and reduction in tariffs. The gross revenue of two private operators Airtel and Vodafone Idea has also reduced in financial years 2017-18 and 2018-19. Besides, he mentioned that according to an inter-ministerial group report submitted on August 31, 2017, the total debt of the telecom industry was Rs 7.88 lakh crore.

The CNX Nifty is currently trading at 11887.85, up by 40.30 points or 0.34% after trading in a range of 11859.45 and 11894.80. There were 36 stocks advancing against 14 stocks declining on the index.

The top gainers on Nifty were Axis Bank up by 1.90%, Indiabulls Housing Finance up by 1.89%, Bharti Infratel up by 1.75%, Mahindra & Mahindra up by 1.63% and IndusInd Bank was up by 1.39%. On the flip side, Tech Mahindra down by 1.62%, Adani Ports down by 1.13%, Power Grid down by 1.03%, Yes Bank down by 0.84% and Hindalco was down by 0.70% were the top losers.

All Asian markets were trading in green; Nikkei 225 surged 201.26 points or 0.95% to 21,287.85, Taiwan Weighted strengthened 111.37 points or 1.05% to 10,763.92, Hang Seng increased 319.36 points or 1.13% to 28,541.34, Straits Times advanced 22.33 points or 0.68% to 3,323.58, Shanghai Composite gained 27.83 points or 0.94% to 3,004.11, KOSPI rose 18.29 points or 0.86% to 2,140.14 and Jakarta Composite was up by 37.00 points or 0.59% to 6,347.49.