Equity markets maintain upward momentum

Indian equity markets maintained their upward momentum in late afternoon session, following gains in Bankex, Telecom and Realty stocks. The broader indices, BSE Mid cap index and Small cap index, are trading above half a percent. Sentiments remained largely positive as Indian manufacturing activity signalled strong growth in the month of September 2020, supported by accelerated increases in new orders and production. As per the survey report, the Nikkei India Manufacturing Purchasing Managers’ Index (PMI) - a composite single-figure indicator of manufacturing performance - jumped to 56.8 in September as against 52.0 in August. Some optimism also came after Reserve Bank of India (RBI) has said that India's current account surplus increased to $19.8 billion or 3.9 percent of GDP in Q1 (April-June) of FY21. It noted that the surplus in the current account in Q1FY21 was on account of a sharp contraction in the trade deficit to $10.0 billion due to steeper decline in merchandise imports relative to exports on a year-on-year basis.

On the global front, Asian markets are trading mostly in green despite a chaotic day on Japan’s benchmark Nikkei index. European markets were trading mostly in green as Swedish retailer H&M and French-Italian chipmaker STMicroelectronics jumped after reporting forecast-beating results, while hopes of more U.S. stimulus aided global sentiment.

The BSE Sensex is currently trading at 38637.55, up by 569.62 points or 1.50% after trading in a range of 38410.20 and 38708.20. There were 25 stocks advancing against 5 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.77%, while Small cap index was up by 0.80%.

The top gaining sectoral indices on the BSE were Bankex up by 3.35%, Telecom up by 1.87%, Realty up by 1.76%, Auto up by 1.31% and Metal was up by 1.26%, while Energy down by 0.25% and Oil & Gas was down by 0.09% were the only losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 9.80%, Bajaj Auto up by 5.19%, Bajaj Finance up by 4.01%, Tech Mahindra up by 3.99% and ICICI Bank up by 3.92%. On the flip side, ONGC down by 1.37%, ITC down by 0.82%, Reliance Industries down by 0.24%, NTPC down by 0.23% and Titan Company down by 0.05% were the top losers.

Meanwhile, reaching its highest mark since January 2012, Indian manufacturing activity signalled strong growth in the month of September 2020, supported by accelerated increases in new orders and production. As per the survey report, the Nikkei India Manufacturing Purchasing Managers’ Index (PMI) - a composite single-figure indicator of manufacturing performance - jumped to 56.8 in September as against 52.0 in August. Moreover, the latest reading was the highest in over eight-and-a-half years.

The report further noted that Indian manufacturers lifted output for the second straight month in September, amid reports of loosened coronavirus disease 2019 (COVID19) restrictions and higher demand. The increase was sharp and the third-quickest in the history of the survey. Similarly, there were back-to-back increases in new business inflows. The rate of expansion picked up to the fastest since early-2012.

On the price front, there was a softer and historically weak rise in input costs. Firms reported higher prices paid for a few materials such as aluminium and steel. Output charges, meanwhile, broadly stabilised following five successive months of reduction. Further, the report said that almost one-third of manufacturers expect output growth in the coming 12 months, against 8% that foresee a contraction, resulting in the strongest degree of overall optimism in over four years.

The CNX Nifty is currently trading at 11412.55, up by 165.00 points or 1.47% after trading in a range of 11347.05 and 11424.65. There were 40 stocks advancing against 10 stocks declining on the index.

The top gainers on Nifty were Indusind Bank up by 9.99%, Bajaj Auto up by 5.10%, ICICI Bank up by 4.26%, Axis Bank up by 4.25% and Bajaj Finance up by 4.10%. On the flip side, ONGC down by 1.37%, Dr. Reddys Lab down by 1.26%, ITC down by 0.87%, BPCL down by 0.85% and Cipla down by 0.35% were the top losers.

Asian markets are trading mostly in green, Straits Times advanced 27.18 points or 1.1% to 2,493.80 and Jakarta Composite was up by 100.05 points or 2.05% to 4,970.09. On the flip side, Nikkei 225 was down by 0.19 points or 0% to 23,184.93.

European markets were trading mostly in green, UK’s FTSE 100 increased 28.68 points or 0.49% to 5,894.78, France’s CAC was up by 14.73 points or 0.31% to 4,818.17. On the flip side, Germany’s DAX was down by 23.19 points or 0.18% to 12,737.54.