Markets trade higher in early deals; Nifty above 9,300 mark

Indian equity benchmarks made optimistic start on Tuesday amid sharp fall in crude oil prices overnight. Markets are trading higher with gains on around one third of a percent each in early deals, supported by buying in Bankex, Basic Materials and Auto counters. Traders took encouragement with report that Prime Minister Narendra Modi has underlined that the lockdown has yielded positive results as the country has managed to save thousands of lives in the past one and a half months. Some support also came as the Reserve Bank of India (RBI) received Rs 64,746 crore worth of bids or more than six times the amount it proposed to buy government bonds through the special open market operation (OMO). Traders took note of a private report that the central government is considering a proposal to guarantee as much as Rs 3 trillion ($39 billion) of loans to small businesses as part of a plan to restart economy, which is reeling under the impact of a 40-day lockdown. Though, markets trimmed some of their opening gains amid concern with report that India on April 27 recorded its highest single-day spike in toll due to COVID-19 as 60 deaths and 1,463 new infections were reported in the last twenty-four hours, taking the countrywide total to 28,380 and the number of deaths to 886.

On the global front, most of the Asian markets are trading higher amid positive cues overnight from Wall Street, as crude oil prices tumbled more than 15 percent and extended losses from Monday. Investors digested data that showed that Japan's unemployment rate rose to a one-year high in March. The Ministry of Communications and Internal Affairs said that the unemployment rate in Japan came in at a seasonally adjusted 2.5 percent in March. That was in line with expectations and up from 2.4 percent in February. The jobs-to-applicant ratio was 1.39, shy of expectations for 1.40, and down from 1.45 in the previous month.

Back home, continuing its efforts to help market participants tide over challenges due to COVID-19 pandemic, market regulator Sebi has decided to reduce broker turnover fees and filing charges on offer documents for public offering, rights issue and buyback of shares. On the sectoral front, the insurance stocks were in focus with Irdai’s data showing that India's life insurance companies clocked 11.36% growth in their collective premium income at Rs 48.26 lakh crore during the fiscal ended March 2020. In scrip specific development, Ambuja Cements rose as it reported a 6.80% rise in its consolidated net profit to Rs 742.59 crore for the first quarter ended March 31.

The BSE Sensex is currently trading at 31848.86, up by 105.78 points or 0.33% after trading in a range of 31839.72 and 32164.65. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.11%, while Small cap index was up by 0.83%.

The top gaining sectoral indices on the BSE were Bankex up by 1.72%, Basic Materials up by 1.23%, Auto up by 0.78%, Realty up by 0.74%, Industrials up by 0.51%, while Energy down by 1.13%, Telecom down by 1.06%, FMCG down by 0.57%, Healthcare down by 0.49%, Power down by 0.17% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 8.60%, Axis Bank up by 3.57%, HDFC up by 3.07%, Tech Mahindra up by 1.94% and ICICI Bank up by 1.60%. On the flip side, Sun Pharma down by 2.13%, Reliance Industries down by 1.48%, HCL Tech. down by 1.35%, Bharti Airtel down by 1.28% and Asian Paints down by 1.07% were the top losers.

Meanwhile, CRISIL, domestic rating agency, has said nearly halved its Gross Domestic Product (GDP) forecast for India to 1.8 percent for FY21 while projecting total losses of Rs 10 lakh crore or Rs 7,000 per person due to disastrous lockdowns to control COVID-19 pandemic. It warned lockdowns are showing a disastrous impact on the economy and could lead to a permanent loss of GDP, unemployment and poverty, despite relief packages.

The agency, which blamed the government response to the crisis to being measured and asked it to drastically up the support, had a GDP growth estimate of 6 percent for FY21, which was last revised to 3.5 percent in late March. It said that the economic growth forecasts are premised on a normal monsoon, sharp fall in oil prices lending a helping hand and the effect of pandemic subsiding in the first quarter of the fiscal year. The risk factors include a dip in global growth, restrictions continuing in India and a second wave of cases emerging up.

Besides, it said with the threat of infections still looming, it acknowledged that policymakers are grappling with a dilemma right now on whether to extend the lockdown beyond May 3 or extend it further which will entail economic costs. There is also a worry of a burst out in infections if the social distancing norms are not followed. It added that if the norms are followed strictly, there will be reverses on economic activity and infuse uncertainties on spending.

The CNX Nifty is currently trading at 9310.40, up by 28.10 points or 0.30% after trading in a range of 9309.40 and 9402.55. There were 32 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Indusind Bank up by 8.11%, UPL up by 3.91%, Axis Bank up by 3.67%, HDFC up by 3.06% and Tata Motors up by 2.72%. On the flip side, Sun Pharma down by 1.90%, Reliance Industries down by 1.85%, Wipro down by 1.84%, Vedanta down by 1.59% and Britannia Industries down by 1.48% were the top losers.

Asian markets are trading mostly in green; Hang Seng gained 203.64 points or 0.84% to 24,483.78, Taiwan weighted rose 34.18 points or 0.32% to 10,601.45, KOSPI soared 2.95 points or 0.15% to 1,925.72, Jakarta Composite inched up 2.18 points or 0.05% to 4,515.32 and Shanghai Composite increased 2.99 points or 0.11% to 2,818.48. On the other hand, Nikkei 225 fell 49.28 points or 0.25% to 19,733.94 and Straits Times was down by 5.74 points or 0.23% to 2,543.66.