Markets trade in fine-fettle; Sensex above 40,200 mark

Indian equity benchmarks made gap-up opening and were trading in fine-fettle in early deals on Thursday. Sensex and Nifty reclaimed their physiological levels of 40,200 and 11,900, respectively. Barring telecom, all other sectoral indices were trading in green on BSE. Traders took encouragement with the Economist Intelligence Unit’s report stating that India and China are projected to see accelerated economic growth in the fourth quarter of this year, bucking trends in the US and the European Union. It added that the real GDP growth of India in the December-ending quarter is expected to be the highest among G7 and BRICS nations. In the third quarter, India's real GDP growth is estimated to be 1% on a quarter-on-quarter basis and is projected to rise to 2.20% in the fourth quarter. Investors took note of report that India and Saudi Arabia have inked more than a dozen agreements in several key sectors including oil and gas, defense and civil aviation to bolster their ties. Though, market participants overlooked s report that the government is unlikely to moderate personal income tax rates for the rich due to fiscal stress on account of lower tax realisation amid slowdown in the economy.

Global cues also remained supportive with most of the Asian markets were trading in green following the positive cues overnight from Wall Street after the US Federal Reserve cut interest rates for the third time this year, but hinted it may put further monetary policy easing on hold. Traders were also looking ahead to the Bank of Japan's monetary policy decision due later today. The bank is expected to keep its benchmark lending rate steady at -0.1 percent, although other forms of stimulus may be introduced. Investors also cheered upbeat Japanese industrial output data. Trade and Industry said in Thursday's preliminary report that industrial production in Japan was up a seasonally adjusted 1.4 percent on month in September.

Back home, telecom stocks were in focus as the Telecom Regulatory Authority of India released the amended broadcasting and cable services interconnection regulations to ensure a fully-compliant audit regime. It said during the consultation undertaken to prepare the audit manual certain comments and observations reflected some issues in the Schedule III of the Interconnection Regulations 2017. In scrip specific development, TVS Motor Company gained on entering into partnership with Cadisa, one of the largest, respected business groups across Guatemala and El Salvador. As a part of this association, Cadisa will facilitate the opening of 15 flagship outlets for TVS Motor Company in a phase-wise manner.

The BSE Sensex is currently trading at 40261.84, up by 209.97 points or 0.52% after trading in a range of 40178.25 and 40297.52. 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 0.48%, while Small cap index was up by 0.70%.

The top gaining sectoral indices on the BSE were Realty up by 2.29%, PSU up by 1.16%, IT up by 0.98%, TECK up by 0.84% and Oil & Gas was up by 0.81%, while Telecom down by 0.59% was the only losing index on BSE.

The top gainers on the Sensex were SBI up by 3.07%, Infosys up by 2.44%, Sun Pharma Industries up by 1.55%, HDFC Bank up by 0.88% and ICICI Bank up by 0.71%. On the flip side, Mahindra & Mahindra down by 1.15%, Power Grid Corporation down by 0.58%, Yes Bank down by 0.53%, Tata Steel down by 0.49% and Bharti Airtel down by 0.48% were the top losers.

Meanwhile, Commerce and Industry Minister Piyush Goyal has said that India would enter into any free-trade agreement (FTA) or comprehensive partnership agreement on its terms and would do what would be best for the people and national interest. He added that the country would not sign any FTA in a rush but will engage with the world without compromising the interest of domestic industry. He said ‘In terms of RCEP (Regional Comprehensive Partnership Agreement), lot of wrong information have been spread all over. Let me assure each one of you that India will no more sign any FTA in a rush. India is not in a weak leadership which had worked only on deadlines to execute FTAs. India will enter into an FTA or comprehensive partnerships on India's terms.’

The minister said the government is careful when it is negotiating trade agreements. Trade is a complex process, therefore he said ‘any engagement which we will do will result in the best for the people and our industry.’ He also said ‘We cannot remain in an isolated world also. We have to engage with the rest of the world. The world is moving towards more and more global integration. So, India will have to finally balance our imperatives to protect domestic interest, yet also engage with the rest of the world.’ He said ‘And that is the fine balance that the government is working on to ensure that we are part of international trading blocs and engagements but not in any way that compromises national interest.’

The RCEP is a mega free-trade agreement being negotiated by 16 countries. The members include ASEAN (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam), Australia, China, India, Japan, South Korea and New Zealand. The negotiations for the RCEP deal have reached at a fundamental phase as the member countries are targeting to conclude the talks by November. As per the target of the member countries, conclusion of the negotiations could be announced in the summit. Several domestic players from industries such as metals, dairy, electronics, and chemicals have raised serious concerns over this agreement due to the presence of China in the grouping, with which India has a huge trade deficit of over $50 billion.

The CNX Nifty is currently trading at 11910.25, up by 66.15 points or 0.56% after trading in a range of 11883.05 and 11914.90. There were 38 stocks advancing against 12 stocks declining on the index.

The top gainers on Nifty were Zee Entertainment up by 3.78%, SBI up by 3.24%, Infosys up by 2.48%, GAIL India up by 1.31% and HDFC Bank up by 1.21%. On the flip side, Mahindra & Mahindra down by 0.97%, Power Grid Corporation down by 0.68%, Yes Bank down by 0.44%, Bharti Airtel down by 0.37% and Axis Bank down by 0.29% were the top losers.

Asian markets were mostly trading in green; Hang Seng increased 281.37 points or 1.06% to 26,949.08, Nikkei 225 surged 86.35 points or 0.38% to 22,929.47, KOSPI rose 21.90 points or 1.05% to 2,102.17, Straits Times advanced 19.54 points or 0.61% to 3,227.46, Taiwan Weighted strengthened 6.87 points or 0.06% to 11,387.15. On the flip side, Shanghai Composite declined 2.68 points or 0.09% to 2,936.64 and Jakarta Composite was down by 35.91 points or 0.57% to 6,259.84.