Barometer gauges maintain gains in late afternoon session

Indian stock markets were trading higher in late afternoon session amid buying in blue chip stocks from across various sectors. Buying in IT, TECK and Oil & Gas stocks helped markets to trade higher. Market participants were taking support with Union Commerce Minister Piyush Goyal’s statement that he will be talking to USTR Robert Lighthizer in the next few days to 'quickly wrap' up initial aspects of the proposed trade deal, which is under negotiations. India and the US are negotiating a trade deal to iron out differences and promote two-way commerce. Traders took note of report that India has moved down three places to 77th rank in terms of money parked by its citizens and enterprises with Swiss banks at the end of 2019, while the UK has retained its top position, as per the latest data from Switzerland's central bank. India was ranked 74th in the previous year. Meanwhile, the Reserve Bank of India Officers’ Association (RBIOA) has raised concerns over setting up of a unified supervisory and regulatory cadre, saying it could have an impact on the central bank in the long run.

On the global front, Asian markets were trading mostly higher as market sentiments improved in tandem with the reports that the US regulators loosened its banking regulations, allowing banks to invest in risky assets such as venture capital funds. Back home, in scrip specific development shares of IRCTC tumbled after the Indian Railways cancelled all regular trains, barring the special Rajdhani and mail express trains announced by the Indian Railways during the Covid-19 induced lockdown, till August 12.

The BSE Sensex is currently trading at 35116.99, up by 274.89 points or 0.79% after trading in a range of 34923.43 and 35241.04. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.82%, while Small cap index was up by 0.63%.

The top gaining sectoral indices on the BSE were IT up by 4.94%, TECK up by 4.04%, Oil & Gas up by 2.59%, PSU up by 1.65% and Metal was up by 1.48%, while FMCG down by 0.57% and Bankex was down by 0.03% were the few losing indices on BSE.

The top gainers on the Sensex were Infosys up by 6.43%, TCS up by 4.50%, HCL Tech up by 2.98%, ONGC up by 2.69% and Bajaj Auto was up by 2.62%. On the flip side, Kotak Mahindra Bank down by 3.05%, ITC down by 1.58%, Titan Company down by 1.03%, Sun Pharma down by 0.85% and Bajaj Finance was down by 0.85% were the top losers.

Meanwhile, giving a wide-ranging forecast for Gross Domestic Product (GDP) in the current fiscal (FY21), think-tank National Council of Applied Economic Research (NCAER) in its latest report said that actual economic growth would depend on the effectiveness of the stimulus package announced by the government to mitigate impact of coronavirus pandemic. However, it said for the stimulus announced by the government and the initiatives taken by the Reserve Bank, GDP in 2020-21 would have contracted by 12.4 percent.

NCAER stated that while a decline in GDP could be significantly contained by the stimulus measures already announced, the actual outcome will depend on the strength of the supply recovery. The annual GDP forecast by NCAER under different scenarios with varying degrees of efficacy of the stimulus package ranges from nil growth to a contraction of 10 percent for 2020-21. It said ‘building on this base case (1.33 percent growth after assuming stimulus but no supply disruptions), we provide four alternative scenarios where we assume that supply disruptions will limit GDP growth to 0 percent, and then more stringently to -2, -5, and -10 percent growth in FY20-21.’

It further said the outlook for agriculture looks positive. It said ‘it is the only sector where we expect positive growth even in the absence of significant stimulus and this is because the availability of the main inputs is reportedly comfortable, the South-West monsoon is expected to be normal, and the incidence of pests and diseases is expected to remain below the economic threshold level.’ On the industrial sector, its assessment is that industrial real gross value added (GVA) may have declined by (-) 54.2 percent in the first quarter of 2020-21. It further expects it to gradually recover to zero percent growth by the fourth quarter, implying an annual decline of (-) 27.1 percent for 2020-21, but this does not take into account the impact of fiscal and monetary stimulus measures. It added that the actual outcome will depend on the demand-stimulating impact of these measures and the strength of the supply response.

The CNX Nifty is currently trading at 10373.25, up by 84.35 points or 0.82% after trading in a range of 10318.05 and 10407.75. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Infosys up by 6.29%, BPCL up by 5.55%, Indian Oil Corporation up by 5.06%, TCS up by 4.26% and Wipro was up by 4.19%. On the flip side, Kotak Mahindra Bank down by 3.04%, ITC down by 1.51%, Bharti Infratel down by 1.36%, Titan Company down by 1.06% and Sun Pharma down by 0.94% were the top losers.

Asian markets were trading mostly in green; KOSPI rose 22.28 points or 1.05% to 2,134.65, Jakarta Composite soared 8.53 points or 0.17% to 4,905.26, Nikkei 225 surged 252.29 points or 1.13% to 22,512.08 and Straits Times was up by 21.26 points or 0.82% to 2,611.41. On the other hand, Hang Seng decreased 187.30 points or 0.76% to 24,594.28.