Markets trade higher in early deals

Indian equity benchmarks made cautious start on Thursday amid mixed Asian cues and rising coronavirus cases in India. The total coronavirus count in the country has risen to 112,028, according to Worldometer data. Though, markets gained traction and are trading higher with gains of over half a percent each in early deals. Buying was witnessed in Auto, Consumer Discretionary and Bankex counters. Traders took encouragement as the union cabinet cleared Rs 3 lakh crore micro, small and medium enterprise (MSME) funding scheme to mitigate the economic distress being faced by the small businesses in the light of the COVID-19 pandemic. Some support also came in with the RBI’s data showing that bank credit rose 6.52 percent year-on-year to Rs 102.52 lakh crore, while deposits grew 10.64 percent to Rs 138.50 lakh crore in the fortnight ended May 8. However, upside remained capped as domestic rating agency Icra warned of a deep recession as it drastically lowered FY21 growth forecast for India to minus 5 percent, citing the very modest fiscal support, extension of the nationwide lockdown and looming labour shortage. The agency also sharply revised downwards the growth contraction in Q1 to 25 percent as against the previous forecast of 16-20 percent and to minus 2.1 percent in Q2 from 2.1 percent growth previously, which implies a recession.

On the global front, most of the Asian markets are trading mixed amid continued optimism about an economic recovery from coronavirus-induced lockdowns. However, investors turned cautious after the World Health Organization said that the number of newly reported coronavirus cases worldwide has hit a daily record since the outbreak began. The WHO also expressed concern about the rising number of cases in low and middle-income countries.

Back home, most of the aviation stocks were trading in green with report that India will resume domestic flights in a calibrated manner from May 25 as passengers follow prevention guidelines for coronavirus. In scrip specific developments, Bajaj Auto surged after posting better-than-expected quarterly earnings. On the other hand, Chennai Petroleum Corporation, a group company of India Oil, slumped as it reported a standalone net loss of Rs 1624.73 crore in the quarter ended March.

The BSE Sensex is currently trading at 31007.33, up by 188.72 points or 0.61% after trading in a range of 30765.32 and 31014.73. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 1.31%, while Small cap index was up by 0.97%.

The top gaining sectoral indices on the BSE were Auto up by 1.94%, Consumer Discretionary up by 1.53%, Bankex up by 1.43%, Telecom up by 1.03%, Consumer Durables up by 0.94%, while Power down by 0.80%, Utilities down by 0.33%, IT down by 0.29%, PSU down by 0.06%, TECK down by 0.04% were the top losing indices on BSE.

The top gainers on the Sensex were Bajaj Auto up by 5.18%, HDFC Bank up by 2.96%, Hero MotoCorp up by 2.26%, Asian Paints up by 1.79% and Kotak Mahindra Bank up by 1.73%. On the flip side, NTPC down by 1.88%, ONGC down by 1.22%, ITC down by 1.14%, Tech Mahindra down by 0.87% and Power Grid down by 0.60% were the top losers.

Meanwhile, the Reserve Bank of India’s data has showed India's overseas direct investment (ODI) in April 2020 dipped 62 per cent to $976.14 million. The fall in ODI can mainly be attributed to the coronavirus pandemic, which led to a global lockdown and halt in most of the business activities.

The data showed that of the total investment by Indian companies in April 2020-21, $586.42 million was in the form of loans, $230.81 million was equity infusion, while $158.91 million was in the form of issuance of guarantees.

Domestic firms had invested nearly $2.56 billion in their joint ventures/wholly-owned subsidiaries during April 2019. Indian firms had invested $2.70 billion in overseas businesses in March 2020.

The CNX Nifty is currently trading at 9120.80, up by 54.25 points or 0.60% after trading in a range of 9056.10 and 9125.50. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Bajaj Auto up by 5.29%, Bharti Infratel up by 3.58%, HDFC Bank up by 3.01%, Hero MotoCorp up by 2.41% and Eicher Motors up by 2.15%. On the flip side, Grasim Industries down by 1.99%, NTPC down by 1.83%, BPCL down by 1.38%, ITC down by 1.22% and Shree Cement down by 1.19% were the top losers.

Asian markets are trading mixed; Straits Times rose 3.71 points or 0.14% to 2,565.65, Taiwan Weighted jumped 85.41 points or 0.78% to 10,993.21, KOSPI gained 8.85 points or 0.44% to 1,998.49 and Shanghai Composite inched up by 1.46 points or 0.05% to 2,885.20. On the other hand, Nikkei 225 declined 64.21 points or 0.31% to 20,530.94, Hang Seng slipped 2.66 points or 0.01% to 24,397.29 and Jakarta Composite was down by 2.71 points or 0.06% to 4,545.95.