Barometer gauges recover in early noon session

Indian stock markets gained momentum in the early noon deals after the government rolled back the enhanced surcharge on foreign portfolio investors, and unveiled a slew of measures to boost the economy. Buying in frontline stocks such as HDFC, Bajaj Finance and Larsen & Toubro were aiding sentiment, while selling in Tata Steel, Vedanta and Hero MotoCorp kept the gains in the markets in check. Besides, broader indices were also trading in green, supporting their larger peers.  Market participants gained strength with Finance Minister Nirmala Sitharaman statement that the India's Gross Domestic Product (GDP) continues to grow at a faster pace than the global economy and any other major economy. Traders were also encouraged by Industry body CII report that the multi-sectoral and multi-dimensional policy stimulus will have significant impact, imparting stability and underpinning a new growth impetus for India. The measures announced come at a time when the world economy is buffeted by global headwinds and trade slowdown.

On the global front, Asian markets were trading in red amid confusing swirl of signals about the US-China trade war. The dramatic tit-for-tat escalation has clouded prospects for a trade deal between the two super power nations. Back on home turf, banking stocks remain in focus as FM Nirmala Sitharaman announced upfront release of Rs 70,000 crore for public sector banks. This will benefit the corporate, MSMEs, retail borrowers and small traders.

The BSE Sensex is currently trading at 36832.15, up by 130.99 points or 0.36% after trading in a range of 36492.65 and 37363.95. There were 13 stocks advancing against 17 stocks declining, while 1 stock remain unchanged on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.45%, while Small cap index was up by 0.59%.

The top gaining sectoral indices on the BSE were Realty up by 1.10%, Consumer Durables up by 1.03%, Capital Goods up by 0.94%, Industrials up by 0.79% and Bankex up by 0.65%, while Metal down by 3.45%, Basic Materials down by 0.99%, IT down by 0.51%, TECK down by 0.46% and Telecom was down by 0.38% were the losing indices on BSE.

The top gainers on the Sensex were HDFC up by 2.87%, Bajaj Finance up by 2.16%, Larsen & Toubro up by 1.32%, Axis Bank up by 1.25% and Mahindra & Mahindra was up by 1.14%. On the flip side, Tata Steel down by 5.32%, Vedanta down by 3.78%, Hero MotoCorp down by 2.44%, Tata Motors - DVR down by 1.81% and Bajaj Auto was down by 1.28% were the top losers.

Meanwhile, the government is likely to soon consider a proposal of relaxing rules for complying with the mandatory 30% local sourcing norms by foreign single brand retailers. According to the proposal, single-brand retail firms would also be allowed to open online stores before setting up brick-and-mortar shops if they bring in over $200 million FDI. Presently, online sale by a single-brand retail player is permitted only after opening of physical outlet.

Relaxations are expected in a provision where foreign retail traders are presently allowed to adjust procurement of goods from India for their global operations for meeting the mandatory local sourcing requirement. However, this is allowed only for five years and incremental sourcing of goods from India is only taken into account presently. Amendments and easing are also likely in this provision.

The move comes in the backdrop of announcements made by Finance Minister Nirmala Sitharaman in her Budget speech that local sourcing norms will be eased for FDI in single brand retail sector. In January 2018, the government allowed 100 percent FDI in the sector, permitting foreign players in single-brand retail trade to set up own shops in India without government approval. FDI in India fell by 11 percent to $22.66 billion during the first half of the financial year 2019 (H1FY19).

The CNX Nifty is currently trading at 10852.90, up by 23.55 points or 0.22% after trading in a range of 10756.55 and 11000.55. There were 23 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing up by 3.68%, HDFC up by 2.59%, Adani Ports &Special up by 2.36%, Bajaj Finance up by 2.06% and Bajaj Finserv was up by 1.73%. On the flip side, Tata Steel down by 5.58%, JSW Steel down by 4.76%, Vedanta down by 3.93%, Hindalco down by 3.44% and Hero MotoCorp was down by 2.45% were the top losers.

All Asian markets were trading in red, Nikkei 225 slipped 449.87 points or 2.17% to 20,261.04, KOSPI fell 28.25 points or 1.45% to 1,920.05, Hang Seng decreased 778.03 points or 2.97% to 25,401.30, Shanghai Composite declined 36.63 points or 1.26% to 2,860.80, Taiwan Weighted dropped 183.54 points or 1.74% to 10,354.57, Jakarta Composite lost 61.71 points or 0.99% to 6,193.89 and Straits Times was down by 51.85 points or 1.67% to 3,058.50.