Benchmarks made gap-up opening; Sensex reclaims 38,000 mark

Indian equity benchmarks made a gap-up opening and are trading jubilantly in early deals with frontline gauges recapturing their crucial 38,000 (Sensex) and 11,200 (Nifty) levels. Sentiments remained up-beat with the Department of Economic Affairs in its monthly macroeconomic report stating the worst may now be over for India and the road ahead will take the economy back on the track. Buying in banking, metal and auto counters too supported the upmove. Traders shrugged off ICRA’s report where it mentioned that the securitisation volumes are estimated to significantly drop to Rs 1.2-1.3 lakh crore during the current fiscal due to the impact of COVID-19 and lower availability of eligible loan pools for securitisation.

Global cues too were supporting sentiments with Asian markets trading mostly in green at this point of time after a report that the U.S. and China will to meet to discuss compliance with their phase-one trade deal. The US markets ended higher after a choppy session on Tuesday, lifted by Apple and energy stocks but limited by declines in AIG and Microsoft while investors awaited more U.S. government stimulus to fight economic fallout from the COVID-19 pandemic. Back home, NMDC were trading in green on producing 2.19 MT of iron ore in July and TCS gains as its software venture launches ignio AI.Assurance.

The BSE Sensex is currently trading at 38047.72, up by 359.81 points or 0.95% after trading in a range of 37889.59 and 38081.30. There were 27 stocks advancing against 3 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index surged 1.07%, while Small cap index was up by 0.98%.

The top gaining sectoral indices on the BSE were Metal up by 1.90%, Bankex up by 1.62%, Basic Materials up by 1.40%, Auto up by 1.34% and Consumer Discretionary Goods & Services was up by 1.22%, however there were no losers on the BSE sectoral front.

The top gainers on the Sensex were Axis Bank up by 3.03%, Bajaj Finance up by 2.51%, Ultratech Cement up by 2.33%, SBI up by 2.03% and Indusind Bank up by 2.02%. On the flip side, Power Grid Corporation down by 1.01%, Nestle down by 0.50% and Hindustan Unilever down by 0.31% were the few losers.

Meanwhile, the Minister of State for Commerce and Industry Hardeep Singh Puri has said that immediate review of the Association of Southeast Asian Nations (ASEAN)-India trade in goods agreement would help realise the true bilateral trade potential between India and the 10-member Southeast Asian bloc. It will also contribute to the realisation of 2020 trade target of $200 billion set by both parties. He noted that the review of the India-ASEAN trade in goods agreement is still pending.

According to the minister, both India and ASEAN need to redouble their efforts towards strengthening cooperation in services sectors such as e-commerce, IT-enabled services, financial services, banking and tourism. He said ‘I think we have to find ways and means of ensuring that the ASEAN economies are equally welcoming of and receptive to exports from India as we are to imports from the ASEAN economies.’ He also highlighted that a significant component of the bilateral trade engagement between India and the ASEAN countries is in the medium and high technology-intensive trade. He noted that in 2018, 40.6 percent of imports and 28.8 percent of exports from India to ASEAN were in this product category.

Puri further said India's annual trade deficit with ASEAN is close to $24 billion. He said ‘the reasons are multiple and I would like in the coming months and years to see this trade deficit narrowed.’ He also pointed out that there is a range of non-tariff barriers, import regulations, quotas and export taxes. Expressing confidence that India and the ASEAN region will emerge much stronger by overcoming challenges posed by the COVID-19 pandemic, he said ‘we need to prepare for the fact that this may not be the last public health emergency faced by us.’

The CNX Nifty is currently trading at 11209.60, up by 114.35 points or 1.03% after trading in a range of 11144.50 and 11210.25. There were 45 stocks advancing against 5 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 3.79%, Axis Bank up by 3.12%, Bajaj Finance up by 2.64%, SBI up by 2.27% and Ultratech Cement up by 2.23%. On the flip side, Power Grid Corporation down by 1.01%, Nestle down by 0.48%, Dr. Reddys Lab down by 0.22%, Hindustan Unilever down by 0.12% and Shree Cement down by 0.02% were the top losers.

Asian markets were trading mostly in green; Straits Times gained 17.25 points or 0.69% to 2,532.95, Hang Seng rose 141.73 points or 0.57% to 25,088.36, Taiwan Weighted jumped 83.85 points or 0.66% to 12,793.77, KOSPI surged 27.34 points or 1.20% to 2,307.31 and Shanghai Composite was up by 9.66 points or 0.29% to 3,381.35. However, Nikkei 225 declined 41.11 points or 0.18% to 22,532.55 and Jakarta Composite was down by 3.69 points or 0.07% to 5,071.31.