Benchmarks trade firm in early deals

Indian equity benchmarks made optimistic start on Friday following positive global cues. Markets are trading firm with gains of around a percent each in early deals, aided by buying in all the sectoral indices on the BSE led by IT, TECK and Metal. Some support came in with Union Commerce Minister Piyush Goyal’s statement that India is keen to focus on certain sectors where it has competitive advantage, emphasising that the country cannot afford to remain dependent on low cost, low quality products. Adding more optimism, a report stated that India and the US will restart high level negotiations on a trade pact in the coming days. Traders took note of Union Finance Minister Nirmala Sitharaman’s statement that the government was in talks with the Reserve Bank of India (RBI) for a one-time restructuring of loans to help companies which are under stressed due to the Covid-19 pandemic. Traders largely overlooked FIEO’s statement that the country's exports are likely to witness a 10-12% year-on-year decline during the ongoing fiscal, if the current trend persists, due to the contraction in global demand on account of the COVID-19 pandemic. Meanwhile, India witnessed the biggest single-day spike of nearly 18,000 in total cases. The country's total count of cases has soared to 491,170, while its Covid-19 death toll has reached 15,300.

On the global front, most of the Asian markets are trading higher following the positive cues overnight from Wall Street after US regulators announced plans to ease regulations that will allow banks to invest in risky assets such as venture capital funds. This helped offset worries about the spiking coronavirus cases in a number of US states. Meanwhile, the markets in Taiwan and China are closed on Friday for the Dragon Boat Festival.

Back home, sugar stocks were buzzing with industry body ISMA’s statement that sugar output in India, the world's second largest producer after Brazil, is expected to increase by 17.69% to 32.01 million tonnes during the season beginning October 2020 on likely higher availability of sugarcane for crushing. In scrip specific developments, Reliance Industries gained as Fitch Ratings upgraded the company’s long-term local-currency issuer default rating (IDR) to BBB+ from BBB with a stable outlook. Apollo Hospitals was trading in green on reporting an over two-fold jump in consolidated net profit to Rs 209.60 crore for the March quarter, mainly on account of one-off gains.

The BSE Sensex is currently trading at 35147.79, up by 305.69 points or 0.88% after trading in a range of 35054.55 and 35241.04. There were 24 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index surged 1.01%, while Small cap index was up by 0.86%.

The top gaining sectoral indices on the BSE were IT up by 2.72%, TECK up by 2.27%, Metal up by 1.67%, Oil & Gas up by 1.62%, Energy up by 1.52%, while there was no losers on the BSE sectoral front.

The top gainers on the Sensex were Indusind Bank up by 4.21%, Infosys up by 3.86%, TCS up by 2.35%, Tata Steel up by 1.52% and HCL Technologies up by 1.49%. On the flip side, Kotak Mahindra Bank down by 1.91%, Hindustan Unilever down by 0.69%, HDFC down by 0.40%, Maruti Suzuki down by 0.27% and Bajaj Finance down by 0.21% were the top losers.

Meanwhile, emphasizing that India cannot afford to remain dependent on low cost, low quality products, Union Commerce Minister Piyush Goyal said the country is very keen to focus on certain sectors where it has competitive advantage. Citing example, he said in the steel sector, India can expand significantly and boost exports. He added that with domestic skilled manpower, availability of certain raw materials, resources and minerals, India can achieve a good growth in certain sectors.

The minister said in sectors like oil and gas and medical devices, India and the US can do a lot of business. Talking about foreign investment, he said barring few sensitive areas, India permits FDI in almost all sectors under automatic route. Besides, he said ‘there are certain ... sectors where we do have constraints and we will not be able to open up anytime soon. If it is related with multi-brand retail, insurance...these are sectors where there have been sensitivities and very serious concerns.’

Further, Goyal said that India is taking steps to simplify procedures and make it online to enhance transparency and improve investment environment. On special economic zones, he said ‘we are seriously looking at how we can change from the earlier system of SEZs  more to industrial clusters and in manufacturing zones so that we are well within the rules of global engagement.’

The CNX Nifty is currently trading at 10382.45, up by 93.55 points or 0.91% after trading in a range of 10352.95 and 10403.75. There were 43 stocks advancing against 7 stocks declining on the index.

The top gainers on Nifty were Indusind Bank up by 4.34%, Infosys up by 4.03%, Hindalco up by 2.90%, BPCL up by 2.78% and Zee Entertainment up by 2.38%. On the flip side, Kotak Mahindra Bank down by 1.82%, Hindustan Unilever down by 0.70%, Bharti Infratel down by 0.63%, HDFC down by 0.16% and Sun Pharma down by 0.12% were the top losers.

Asian markets are trading mostly higher; Nikkei 225 jumped 265.96 points or 1.19% to 22,525.75, Straits Times rose 22.38 points or 0.86% to 2,612.53, KOSPI soared by 22.20 points or 1.05% to 2,134.57 and Jakarta Composite gained 11.36 points or 0.23% to 4,908.09, while Hang Seng was down by 143.61 points or 0.58% to 24,637.97.