Markets trade firm in early deals; Nifty above 11,600 mark

Indian equity benchmarks made optimistic start and are trading firm with gains of over 0.30% each in early deals on Thursday. Buying in Capital Goods, Consumer Durables and Healthcare stocks supported markets, while selling was witnessed in Telecom, Oil & Gas and PSU stocks. Investors took some encouragement as India jumped 14 places to the 63rd position on the World Bank’s ease of doing business ranking, riding high on the government’s flagship Make in India scheme and other reforms attracting foreign investment. The country also figured among the top 10 performers on the list for the third time in a row. Adding some optimism among market participants, the Chairman of the Economic Advisory Council to the Prime Minister Bibek Debroy said that India’s Gross Domestic Product (GDP) which is hovering around 5 percent is expected to inch up to 7 percent in the next financial year. Meanwhile, according to the early trends of the counting of votes, Prime Minister Narendra Modi's BJP established an early lead in both Maharashtra and Haryana.

Global cues also remained supportive with most of the Asian markets trading higher following the modest gains on Wall Street overnight and as upbeat corporate earnings results helped offset concerns about the Brexit uncertainty and the US-China trade war. Besides, investors are eyeing Japan’s final August numbers for its leading and coincident indexes, preliminary October figures for the manufacturing PMI from Nikkei, and the services and composite indexes from Jibun later in the day.

Back home, former NASSCOM President R Chandrashekhar said that a hard Brexit would benefit India's information technology (IT) services companies to strengthen partnerships in the UK with anticipated easing of flow of high-skilled manpower. In scrip specific development, HCL Technologies gained traction as it beat industry estimates by reporting a 19.4% quarter-on-quarter jump in net profit for the July-September quarter. The net profit stood at Rs 2,651 crore as compared to Rs 2,220 crore in the previous quarter. However, Infosys remain in focus with report that markets regulator Securities and Exchange Board of India (Sebi) is probing the buildup of huge derivatives positions in Infosys stock before allegations of accounting malpractices went public.

The BSE Sensex is currently trading at 39181.30, up by 122.47 points or 0.31% after trading in a range of 39165.33 and 39327.15. 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 0.28%, while Small cap index was up by 0.41%.

The top gaining sectoral indices on the BSE were Capital Goods up by 0.66%, Consumer Durables up by 0.61%, Healthcare up by 0.51%, Metal up by 0.49% and Industrials was up by 0.48%, while Telecom down by 2.59%, Oil & Gas down by 1.08%, PSU down by 0.54%, TECK down by 0.47% and Energy was down by 0.38% were the top losing indices on BSE.

The top gainers on the Sensex were HCL Technologies up by 2.95%, Tech Mahindra up by 1.51%, Vedanta up by 1.40%, Larsen & Toubro up by 1.31% and HDFC up by 1.28%. On the flip side, Bharti Airtel down by 3.19%, Infosys down by 1.22%, ONGC down by 1.20%, Tata Motors - DVR down by 0.92% and Hero MotoCorp down by 0.92% were the top losers.

Meanwhile, improving its ranking for the third straight year, India has jumped 14 places to the 63rd position in the World Bank's (WB) ‘ease of doing business’ report on the government’s flagship ‘Make in India’ scheme and other reforms attracting foreign investment. It added that one of the main reasons for improvement in India’s ranking this year goes to the successful implementation of the Insolvency and Bankruptcy Code. Besides, New Zealand, Singapore and Hong Kong topped the list this year. The country also figured among the top 10 performers on the list for the third time in a row. India was ranked 142nd among 190 nations in 2014. Four years of reform pushed up India’s rank to 100th in World Bank’s ‘Doing Business’ 2018 report. It was 130th in 2017, while last year, the country jumped 23 places to the 77th position on the back of reforms related to insolvency, taxation and other areas.

The World Bank in its report also commended the reform efforts undertaken by the country ‘given the size of India’s economy’. Apart from India, the other countries on this year’s ‘top 10 performers’ list are Saudi Arabia (62), Jordan (75), Togo (97), Bahrain (43), Tajikistan (106), Pakistan (108), Kuwait (83), China (31) and Nigeria (131). The World Bank said Prime Minister Modi’s ‘Make in India’ campaign focused on attracting foreign investment, boosting the private sector - manufacturing in particular - and enhancing the country’s overall competitiveness. The government turned to the Doing Business indicators to show investors India’s commitment to reform and to demonstrate tangible progress. In 2015, the government’s goal was to join the 50 top economies on the ease of doing business ranking by 2020.

As per the report, while the competition to move up the ladder would increase and become much tougher, India is on track to be within top 50 of the Ease of Doing business in the next year or two. And to come under 25 or below 50, the Modi government needs to announce and start implementing next set of ambitious reforms now, as these reforms takes a few years to be realized on the ground. The report said the administration’s reform efforts targeted all of the areas measured by Doing Business, with a focus on paying taxes, trading across borders, and resolving insolvency. The country has made a substantial leap upward, raising its ease of doing business ranking from 130 in Doing Business 2016 to 63 in Doing Business 2020. It said in addition to resolving insolvency, significant improvements were registered in starting business, dealing with construction permits and trading across borders.

The CNX Nifty is currently trading at 11638.65, up by 34.55 points or 0.30% after trading in a range of 11629.60 and 11679.60. There were 33 stocks advancing against 16 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were HCL Technologies up by 3.15%, Eicher Motors up by 2.04%, Tech Mahindra up by 1.84%, Vedanta up by 1.33% and Larsen & Toubro up by 1.32%. On the flip side, BPCL down by 3.87%, Bharti Airtel down by 3.16%, Bharti Infratel down by 1.81%, Grasim Industries down by 1.53% and Indian Oil Corporation down by 1.42% were the top losers.

Asian markets were mostly trading in green; Nikkei 225 surged 143.88 points or 0.64% to 22,769.26, Hang Seng increased 124.38 points or 0.47% to 26,691.11, Jakarta Composite soared 46.31 points or 0.74% to 6,304.12, Taiwan Weighted strengthened 28.52 points or 0.25% to 11,268.19 and Straits Times advanced 26.47 points or 0.84% to 3,170.75. On the flip side, KOSPI fell 4.05 points or 0.19% to 2,076.57 and Shanghai Composite was down by 6.37 points or 0.22% to 2,935.25.