Sensex, Nifty bounce to day’s highs

Indian equity benchmarks bounced to intraday high points in late afternoon deals, tracking firm European markets. Traders got encouragement, after the Central Board of Direct Taxes (CBDT) Chairman P C Mody said that the tax department is reasonably confident of meeting the revised direct tax collection of Rs 11.7 lakh crore in current fiscal. Sentiments were also upbeat, as the Indian service sector started a new year 2020 on a strong footing, on the back of fastest increase in new orders and output. As per the survey report, the seasonally adjusted Nikkei Services Business Activity Index surged to 55.5 in January from 53.3 in December. Further, the Nikkei India Composite PMI Output Index -- which measures both manufacturing and services - also rose from 53.7 in December to 56.3 in January.

On the global front, European markets were trading in green, as Swiss consumer confidence improved in the first quarter as households were more positive about economic situation and labor market. The consumer sentiment index rose to -9.4 in the first quarter from -10.3 in the preceding period. Asian markets were also trading in green, after private sector business in Singapore continued to expand in January, and at a faster rate, with an eight-month high PMI score of 51.4. That's up from 51.0 in December, and it moves further above the boom-or-bust line of 50 that separates expansion from contraction.

The BSE Sensex is currently trading at 41109.30, up by 319.92 points or 0.78% after trading in a range of 40703.32 and 41154.66. There were 20 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.19%, while Small cap index was up by 0.58%.

The top gaining sectoral indices on the BSE were Telecom up by 2.20%, Realty up by 2.05%, Industrials up by 1.78%, Capital Goods up by 1.74% and Metal up by 1.64%, while Consumer Disc down by 0.19% was the lone losing index on BSE.

The top gainers on the Sensex were Tata Steel up by 3.15%, Bharti Airtel up by 2.09%, TCS up by 1.98%, Larsen & Toubro up by 1.89% and SBI up by 1.73%. On the flip side, Hero MotoCorp down by 4.16%, Maruti Suzuki down by 2.06%, Nestle down by 1.15%, Power Grid down by 1.06% and Asian Paints down by 0.79% were the top losers.

Meanwhile, the Indian service sector started a new year 2020 on a strong footing, on the back of fastest increases in new orders and output. As per the survey report, the seasonally adjusted Nikkei Services Business Activity Index surged to 55.5 in January from 53.3 in December. Further, the Nikkei India Composite PMI Output Index -- which measures both manufacturing and services – also rose from 53.7 in December to 56.3 in January.

The IHS Markit India Services Business Activity Index signalled the strongest upturn in output for seven years. The rebound largely stemmed from favourable market conditions and better underlying demand. With new business growth ticking higher, services companies continued to add to their workforces. The rate of job creation was little-changed from December, thereby remaining above its long-run average.

Further, despite expanded capacities, and in line with strong influxes of new business, outstanding business at services firms continued to rise at the start of 2020. The rate of accumulation was, however, only slight. The uptick in growth was accompanied by an intensification of inflationary pressures, with input costs rising to the greatest extent since February 2013 and output charge inflation picking up to a near two-year high.

Meanwhile, Indian services firms expect further improvements in demand, advertising and the approval of pending projects to support growth of business activity over the coming 12 months. The overall degree of optimism was similar to December's fourmonth high, remaining below its long-run average.

The CNX Nifty is currently trading at 12077.00, up by 97.35 points or 0.81% after trading in a range of 11953.35 and 12091.65. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 9.87%, Yes Bank up by 7.73%, BPCL up by 5.02%, Tata Steel up by 3.92% and JSW Steel up by 3.54%. On the flip side, Zee Entertainment down by 9.08%, Hero MotoCorp down by 4.08%, Dr. Reddy’s Lab down by 2.94%, Adani Ports & SEZ down by 2.24% and Maruti Suzuki down by 2.17% were the top losers.

Asian markets were trading higher; Nikkei 225 surged 234.97 points or 1.02% to 23,319.56, Shanghai Composite gained 24.53 points or 0.88% to 2,807.82, Straits Times advanced 29.70 points or 0.94% to 3,186.27, KOSPI rose 7.73 points or 0.36% to 2,165.63, Jakarta Composite soared 27.47 points or 0.46% to 5,949.81, Taiwan Weighted strengthened 17.70 points or 0.15% to 11,573.62 and Hang Seng was up by 50.68 points or 0.19% to 26,726.66.

All European markets were trading in green, UK’s FTSE 100 gained 34.60 points or 0.47% to 7,474.42, France’s CAC rose 31.69 points or 0.53% to 5,966.74 and Germany’s DAX was up by 80.45 points or 0.61% to 13,362.19.