Local equities rebound in positive territory ahead of Union Budget

Subsequent to negative opening, local equity markets rebounded in positive territory and were trading marginally higher amid alternate bouts of buying-selling ahead of the release of the Union Budget to be presented by Finance Minister Nirmala Sitharaman later in the day. Investors expect several steps to revive the economy and the sentiments in the market. Hindustan Unilever, Ultratech Cement and Bajaj Finance were among the top gainers. Market participants took encouragement from a report that GST collections have crossed the Rs 1 lakh crore mark for the third month in a row in January with improved compliance and plugging of evasion. However, further upside remain capped as the government revised downwards the economic growth rate for 2018-19 to 6.1 per cent from 6.8 per cent estimated earlier, mainly on account of deceleration in mining, manufacturing and farm sectors. Meanwhile, foreign institutional investors sold equities worth Rs 4,179.12 crore, while domestic institutional investors purchased shares worth Rs 3,816.44 crore on January 31.

On the sectoral front, Sugar industry stocks were in limelight with a report from All India Sugar Trade Association (AISTA) showed that sugar production is estimated to fall almost 17.5 per cent from 33.2 MT last year to 27.4 MT in the ongoing season.

The BSE Sensex is currently trading at 40809.40, up by 85.91 points or 0.21% after trading in a range of 40444.48 and 40816.87. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.75%, while Small cap index was up by 0.48%.

The top gaining sectoral indices on the BSE were Realty up by 1.32%, FMCG up by 0.98%, Oil & Gas up by 0.76%, Capital Goods up by 0.76% and Energy was up by 0.65%, while Metal down by 0.82%, Power down by 0.48%, Consumer Durables down by 0.16%, TECK down by 0.13% and BANKEX was down by 0.11% were the top losing indices on BSE.

The top gainers on the Sensex were Hindustan Unilever up by 2.45%, Ultratech Cement up by 1.36%, Bajaj Finance up by 1.19%, Reliance Industries up by 0.94% and SBI was up by 0.93%. On the flip side, Power Grid down by 1.74%, Tech Mahindra down by 1.62%, NTPC down by 1.20%, Tata Steel down by 1.16% and Kotak Mahindra Bank was down by 0.92% were the top losers.

Meanwhile, Growth of eight core industries recovered to 1.3 percent in December 2019 after remaining in the negative zone in the previous four months helped by expansion in production of coal, fertiliser and refinery products. However, the growth was lower than 2.1 percent recorded in December 2018. According to data released by the ministry of Commerce and Industry, the combined Index of eight core industries stood at 133.2 in December, 2019, which was 1.3 percent higher compared to the index of December, 2018. The Eight Core Industries - coal, crude oil, natural gas, refinery products, fertilisers, steel, cement and electricity - comprise 40.27 percent of the weight of items included in the Index of Industrial Production (IIP).  

Among eight core sectors, Coal production having 10.33 percent weight increased by 6.1 percent in December, 2019 over December, 2018, while its cumulative index decreased by 3.8 percent during April to December, 2019-20 over corresponding period of the previous year. Petroleum Refinery production having 28.04 percent weight increased 3.0 percent in December, 2019 over December, 2018, while its cumulative index dropped by 0.6 percent during April to December, 2019-20 over the corresponding period of previous year.  

The Natural Gas production having 6.88 percent weight declined by 9.2 percent in December, 2019 over December, 2018, and its cumulative index was down by 3.8 percent during April to December, 2019-20 over the corresponding period of previous year. Steel production having 17.92 percent weight increased by 1.9 percent in December, 2019 over December, 2018 and its cumulative index surged by 5.2 percent during April to December, 2019-20 over the corresponding period of previous year. Electricity generation having 19.85 percent weight fell 1.6 percent in December, 2019 over December, 2018 while its cumulative index increased by 0.5 percent during April to December, 2019-20 over the corresponding period of previous year. 

Cement production having 5.37 percent weight increased by 5.5 percent in December, 2019 over December, 2018 and its cumulative index rose by 0.7 percent during April to December, 2019-20 over the corresponding period of previous year. Crude Oil production having 8.98 percent weight increased by 6.1 percent in December, 2019 over December, 2018 and its cumulative index fell by 3.8 percent during April to December, 2019-20 over the corresponding period of previous year. Fertilizer production having 2.63 percent weight surged by 10.2 percent in December, 2019 over December, 2018, and, its cumulative index increased by 4.7 percent during April to December, 2019-20 over the corresponding period of previous year.  

The CNX Nifty is currently trading at 11971.65, up by 9.55 points or 0.08% after trading in a range of 11880.65 and 11984.20. There were 24 stocks advancing against 25 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Hindustan Unilever up by 2.29%, Bajaj Finserv up by 1.67%, GAIL India up by 1.66%, JSW Steel up by 1.56% and Bajaj Finance was up by 1.42%. On the flip side, Coal India down by 2.61%, Tech Mahindra down by 1.87%, Power Grid down by 1.82%, NTPC down by 1.51% and Tata Steel was down by 1.36% were the top losers.