Sensex, Nifty maintain gaining momentum

Bulls were holding a tight grip over the Dalal Street in late morning deals, with both Sensex and Nifty maintaining their gaining momentum. Rally continued over the street on the back of positive cues from other Asian markets. Domestic sentiments remained positive, as India's manufacturing sector activity improved for the second straight month in September and touched an over eight-and-a-half-year high supported by accelerated increases in new orders and production, even as firms reduced staff numbers. The headline seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index (PMI) increased from 52.0 in August to 56.8 in September -- highest since January 2012.

On the global front, Asian markets were trading mostly in green, even after the manufacturing sector in Indonesia fell into contraction in September, the latest survey from IHS Markit showed on Thursday with a manufacturing PMI score of 47.2. That's down from 50.8 in August, and it falls beneath the boom-or-bust line of 50 that separates from expansion. Individually, output and new orders slipped back into decline, while job shedding persisted. Purchasing activity and inventories fell further.

The BSE Sensex is currently trading at 38653.25, up by 585.32 points or 1.54% after trading in a range of 38410.20 and 38703.71. There were 26 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.86%, while Small cap index was up by 0.97%.

The top gaining sectoral indices on the BSE were Bankex up by 2.83%, Telecom up by 1.88%, Metal up by 1.72%, Auto up by 1.70% and Realty up by 1.63%, while Consumer Durables down by 0.05% was the only losing index on BSE.

The top gainers on the Sensex were Bajaj Auto up by 5.96%, Indusind Bank up by 5.59%, Bajaj Finance up by 4.07%, ICICI Bank up by 3.44% and Axis Bank up by 3.37%. On the flip side, ONGC down by 1.44%, NTPC down by 0.47%, Titan Company down by 0.14% and ITC down by 0.09% were the top losers.

Meanwhile, the government’s fiscal deficit remained above the annual target for second month in row at the end of August, mainly on account of the impact of lockdown on revenue collections. According to the data released by the Controller General of Accounts (CGA), fiscal deficit during April-August was at 109.3% of the annual target estimated in the Budget. In absolute terms, the fiscal deficit was at Rs 8,70,347 crore. It stood at 78.7% of Budget Estimates (BE) in the corresponding period during the last fiscal year. Fiscal deficit or the gap between the expenditure and revenue had breached the annual target in July.

The government had pegged fiscal deficit for 2020-21 at Rs 7.96 trillion or 3.5% of Domestic Product (GDP) in the Budget presented by Finance Minister Nirmala Sitharaman in February. These figures, how­ever, may have to be revised significantly in view of the econo­mic disruptions created by the outbreak of coronavirus pandemic. Fiscal deficit had soared to a seven-year high of 4.6% of the GDP in 2019-20, mainly on account of poor revenue realisation, which dipped further towards the end of March because of a nationwide lockdown to contain the spread of coronavirus.

According to CGA data, the government's revenue receipts stood at Rs 3,70,642 crore or 18.3% of BE in April-August. During the same period of the last fiscal, it was at 30.7% of BE. Tax revenue stood at Rs 2,84,495 crore or 17.4% of BE during the first five months of the fiscal. During the corresponding period of the last fiscal, it was at 24.5% of BE. Total receipts of the government stood at 16.8% of BE or Rs 3,77,306 crore. In the Budget, the government had estimated the total receipts for the fiscal at Rs 22.45 trillion. The government's total expenditure stood at Rs 12,47,653 crore or 41% of BE at end-August. During the same period of the last fiscal, total expenditure was at 42.2% of BE.

The CNX Nifty is currently trading at 11413.15, up by 165.60 points or 1.47% after trading in a range of 11347.05 and 11423.50. There were 43 stocks advancing against 7 stocks declining on the index.

The top gainers on Nifty were Bajaj Auto up by 5.82%, Indusind Bank up by 5.77%, Bajaj Finance up by 4.43%, ICICI Bank up by 3.57% and Axis Bank up by 3.34%. On the flip side, ONGC down by 1.30%, Dr. Reddy’s Lab down by 1.06%, Britannia down by 0.45%, Titan Co down by 0.41% and NTPC down by 0.35% were the top losers.

Asian markets were trading mostly in green; Jakarta Composite soared 49.07 points or 1.01% to 4,919.11 and Straits Times advanced 30.89 points or 1.25% to 2,497.51, while Nikkei 225 slipped 0.19 points to 23,184.93.