Local indices remain in green in morning deals

Indian equity benchmarks continued to trade on a positive note in morning deals, tracking gains in index-heavyweights Reliance Industries, Infosys and Asian Paints despite a weak trend in Asian markets. Sentiments remained positive with report that the government aims to catapult India to among the top 10 countries in World Bank's ease of doing business rankings with the comprehensive labour reforms which are likely to be completed after Parliament approves three draft codes in the ongoing session. Some support also came as parliament passed amendments to the Banking Regulation Act to bring cooperative banks under the supervision of the RBI, a move aimed at protecting the interest of depositors. On the sectoral front, stocks related to telecom sector remained in focus with Minister of State for Communications Sanjay Dhotre stating that telecom operators shall pay 10 percent of the adjusted gross revenue (AGR) dues demanded by the DoT by March 31 as directed by the Supreme Court. He also said the estimated revenue likely to be generated will depend on the payments made by the telecom companies.

On the global front, Asian markets were trading mostly in red as persistent worries about the global economic recovery kept investors cautious. Besides, the latest survey from Jibun Bank revealed that the manufacturing sector in Japan continued to contract in September, albeit at a barely slower pace, with a manufacturing PMI score of 47.3. That's up marginally from 47.2 in August, although it remains beneath the boom-or-bust line of 50 that separates expansion from contraction.

The BSE Sensex is currently trading at 37938.75, up by 204.67 points or 0.54% after trading in a range of 37855.64 and 38140.07. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.44%, while Small cap index was up by 0.82%.

The top gaining sectoral indices on the BSE were Energy up by 1.46%, Realty up by 1.21%, Consumer Discretionary up by 0.93%, Consumer Durables up by 0.88% and FMCG up by 0.87%, while Telecom down by 4.12%, Power down by 1.27%, Utilities down by 0.75%, PSU down by 0.32% and Metal down by 0.16% were the top losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 2.47%, Infosys up by 2.10%, Reliance Industries up by 1.82%, ITC up by 1.41% and Hindustan Unilever up by 1.14%. On the flip side, Bharti Airtel down by 5.10%, Tata Steel down by 2.78%, Indusind Bank down by 1.84%, TCS down by 1.75% and Power Grid down by 1.66% were the top losers.

Meanwhile, the United Nations Conference on Trade and Development (UNCTAD), in its report for 2020, titled From Global Pandemic To Prosperity for All: Avoiding Another Lost Decade, has projected India’s economy to contract 5.9% in 2020, and warned the country to not repeat its past mistake of announcing austerity measures. However, it forecast the economy to grow 3.9% next year. It said in the case of India, the baseline scenario is a sharp recession in 2020 as strict lockdown measures to stem the virus’s spread brought many productive activities to a halt across the country.

It said ‘although we expect a rebound in 2021 in line with the growth rates of the Indian economy in recent years, the contraction registered in 2020 is likely to translate into a permanent income loss.’ However, these numbers are based on constant dollars with 2015 as base year and hence exchange rates might have played an important role in these estimations.

India was not projected as the fastest-contracting economy as the UK, France, Italy, South Africa, Mexico, Argentina and Brazil were forecast to witness more shrinking growth rates in the current calendar year. In fact the GDP of Argentina and Mexico is pegged to fall in double digits this year. However, it expected India to witness the steepest contraction in Asia in 2020. It warned against expenditure compressing measures which countries such as India, Mexico, Brazil, Argentina and South Africa have implemented in the past. Besides, it said among G20 countries, Argentina, Brazil, India, Mexico and South Africa have all implemented austerity in the past years but are now struggling to access reliable sources of finance.

The CNX Nifty is currently trading at 11208.80, up by 55.15 points or 0.49% after trading in a range of 11184.60 and 11259.55. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Asian Paints up by 2.30%, Infosys up by 2.09%, Reliance Industries up by 1.85%, Wipro up by 1.63% and ITC up by 1.29%. On the flip side, Bharti Airtel down by 4.88%, Tata Steel down by 2.75%, JSW Steel down by 1.91%, Indusind Bank down by 1.84% and Grasim Industries down by 1.80% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 slipped 107.69 points or 0.46% to 23,252.61, Taiwan Weighted dropped 54.91 points or 0.43% to 12,590.60, Jakarta Composite lost 32.44 points or 0.66% to 4,901.65, Hang Seng decreased 2.88 points or 0.01% to 23,713.97 and Straits Times trembled 0.47 points or 0.02% to 2,462.82.

On the flip side, Shanghai Composite gained 0.79 points or 0.02% to 3,275.09 and KOSPI rose 2.13 points or 0.09% to 2,334.72.