Markets continue to trade in green in early noon session

Indian equity benchmarks continued to trade in green in early noon session, as investors purchased battered blue chips at attractive valuations. Sentiment perked up with Union minister Piyush Goyal’s statement that India’s service sector can help achieve the Central government’s target of $5 trillion GDP. The service sector has the potential to be the largest job creators in the country and over the next five years it has the potential to contribute $3 trillion out of the $5 trillion GDP target set by the government. Besides, rupee strengthens against dollar on increasing US currency’s selling by exporters and banks, that too supporting the markets. At present, both the sensex and Nifty were trading above their crucial 40,900 and 12,050 levels, respectively.

On the global front, Asian markets were trading mostly in green, as US President Donald Trump suggested that trade deal with China is in the final stages. Back home, the broader markets were supporting the larger peers with BSE Mid-cap and Small-cap indices trading up by 0.29% and 0.14%, respectively. In scrip specific development, auto stocks catch speed with reports that the government may consider approving scrappage policy.

The BSE Sensex is currently trading at 40941.89, up by 120.59 points or 0.30% after trading in a range of 40921.93 and 41075.76. There were 22 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.29%, while Small cap index was up by 0.14%.

The top gaining sectoral indices on the BSE were Auto up by 1.04%, Basic Materials up by 0.83%, Metal up by 0.67%, IT up by 0.51% and Consumer Discretionary was up by 0.46%, while Capital Goods down by 1.48%, Realty down by 0.74%, Industrials down by 0.53%, Telecom down by 0.28% and Power was down by 0.13% were the top losing indices on BSE.

The top gainers on the Sensex were Yes Bank up by 5.36%, Mahindra & Mahindra up by 1.93%, Tata Motors up by 1.83%, Maruti Suzuki up by 1.65% and Tata Motors - DVR was up by 1.56%. On the flip side, Larsen & Toubro down by 2.19%, ICICI Bank down by 0.97%, ITC down by 0.64%, Tata Steel down by 0.47% and Bharti Airtel was down by 0.32% were the top losers.

Meanwhile, in order to achieve India's massive infrastructure targets, Credit ratings agency Crisil, in its 'Infrastructure Yearbook 2019' has said that states need to scale up Infrastructure spending to Rs 110 lakh crore over the next decade starting FY21 from an estimated Rs 32 lakh crore in the current decade. It noted that states already account for 41 percent of the overall infrastructure spending of Rs 77 lakh crore this decade.

According to the report, for the country-wide infrastructure, required spending will be Rs 235 lakh crore over the next decade, and called for average gross domestic product (GDP) growth of 7.5 percent and infrastructure spending of above 6 percent of GDP to help achieve this. It pointed out that five sectors -transport, irrigation, energy, urban & housing, and water & sanitation - accounted for two-thirds of states' spending. It added that some of these sectors, which come under the purview of states, have burgeoning infrastructure deficits, and need big investment leaps to plug the gaps.

Ratings agency further stated that unless states contribute nearly 50 percent of infrastructure investments, India’s build-out momentum could taper sharply. It also said that with private investments tepid in recent years, and fiscal limitations on central spending, states have been keeping public spending going. It noted that they will need to strengthen fiscal health and build institutional capacity to sustain far higher levels of capex. It added that the spending trajectory of 15 large states, which accounted for 83 percent of infrastructure capex during fiscals 2015-2019, will be crucial to the overall goal.

The CNX Nifty is currently trading at 12074.90, up by 37.20 points or 0.31% after trading in a range of 12065.10 and 12108.50. There were 38 stocks advancing against 11 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Yes Bank up by 6.02%, UPL up by 2.10%, Tata Motors up by 2.02%, Maruti Suzuki up by 1.71% and Mahindra & Mahindra was up by 1.70%. On the flip side, Cipla down by 2.40%, Larsen & Toubro down by 2.25%, Bharti Infratel down by 0.86%, ICICI Bank down by 0.83% and ITC was down by 0.68% were the top losers.

Asian markets were trading mostly in green, Nikkei 225 surged 83.69 points or 0.36% to 23,457.01, KOSPI rose 6.67 points or 0.31% to 2,128.02, Shanghai Composite gained 3.30 points or 0.11% to 2,910.36, Taiwan Weighted strengthened 70.88 points or 0.61% to 11,647.70, Straits Times advanced 1.33 points or 0.04% to 3,209.18 and Jakarta Composite was up by 1.33 points or 0.02% to 6,027.52. On the other hand, Hang Seng was down by 20.12 points or 0.07% to 26,893.80.