Benchmarks trade in fine-fettle in early deals

Indian equity benchmarks made firm start on Monday, after a long weekend holiday, tracking rally in Asian peers. Markets are trading in fine-fettle with gains of over a percent each in early deals, supported by buying in IT, TECK and Bankex counters. Investors are eyeing the Services PMI data to be out later in the day. Sentiments got a boost with Finance Ministry’s report that important structural reforms undertaken by the government to combat risks associated with the coronavirus pandemic will strengthen the country's economic fundamentals and ensure long-term sustained growth. Adding more optimism a report stated that the CEOs of top 115 companies who met at CII's National Council earlier this week indicated a revival of business sentiment and a gradual rise in expected corporate performance in a poll, raising hopes that a steady recovery of India's economy is on the anvil. Meanwhile, India on Sunday registered 74,767 new Covid-19 cases, taking the tally past the 6.6-million mark. With 902 fatalities in 24 hours, India's death toll stands at 102,714.

On the global front, Asian markets were trading in positive territory as investors digested news that US President Donald Trump, who tested positive for the coronavirus last week, may be discharged from hospital later today. The news eased some of the political uncertainty surrounding the US presidential election in November. The markets in China remain closed for the National Day holiday. Back home, banking stocks were in focus with Nabard data that regional rural banks (RRBs) as a group reported net loss of Rs 2,206 crore in the fiscal year ended March 31, 2020, as against Rs 652-crore net loss in FY19. In scrip specific development, Tata Motors gained on reporting a 5.09 per cent increase in total sales to 110,379 units in the second quarter of the current fiscal.

The BSE Sensex is currently trading at 39172.74, up by 475.69 points or 1.23% after trading in a range of 38923.19 and 39184.18. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.45%, while Small cap index was up by 0.54%.

The top gaining sectoral indices on the BSE were IT up by 2.88%, TECK up by 2.43%, Bankex up by 2.12%, Metal up by 1.89%, Basic Materials up by 0.77%, while Oil & Gas down by 0.18%, Telecom down by 0.04% were the only losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 5.37%, Tata Steel up by 4.97%, TCS up by 3.63%, ICICI Bank up by 3.18% and Infosys up by 2.83%. On the flip side, Asian Paints down by 0.99%, ONGC down by 0.65%, Mahindra & Mahindra down by 0.58%, Ultratech Cement down by 0.40% and Bharti Airtel down by 0.34% were the top losers.

Meanwhile, the monthly economic report prepared by the Economic Affairs Department of the Finance Ministry has said that important structural reforms undertaken by the government to combat risks associated with the coronavirus disease (Covid-19) pandemic will strengthen the country's economic fundamentals and ensure long-term sustained growth. It also said the enabling policy environment and initiatives taken by all stakeholders to seize the available opportunities will actualize the growth potential of the Indian economy.

According to the report, major structural reforms launched by the government in agriculture markets, labour laws and definition of MSMEs provide unparalleled opportunity for the resilient MSME sector to grow and prosper now and thereby, contribute to job creation in the primary and secondary sectors. It also noted that the historic labour reforms, discussed for three decades after the conditionality in the 1991 loan from International Monetary Fund (IMF) but never implemented thus far, will benefit MSMEs to increase employment, enhance labour productivity and thereby wages in MSMEs.

Saying that the reforms in agricultural sector were overdue, the report said the existing laws kept Indian farmers enslaved to the local mandi and their rent-seeking intermediaries. The implementation of 'Aatmanirbhar Bharat' package and unlocking of the economy have ensured that economic recovery in India has gained momentum.

The CNX Nifty is currently trading at 11548.25, up by 131.30 points or 1.15% after trading in a range of 11476.45 and 11552.00. There were 37 stocks advancing against 12 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Indusind Bank up by 5.88%, Tata Steel up by 4.58%, Wipro up by 4.20%, TCS up by 3.51% and ICICI Bank up by 3.26%. On the flip side, GAIL India down by 1.19%, Asian Paints down by 0.90%, ONGC down by 0.87%, Cipla down by 0.72% and Adani Ports & SEZ down by 0.67% were the top losers.

Asian markets were trading higher; Nikkei 225 surged 290.62 points or 1.26% to 23,320.52, Straits Times rose 14.31 points or 0.57% to 2,510.42, Hang Seng jumped 359.56 points or 1.53% to 23,818.61, Taiwan Weighted gained 13.80 points or 0.11% to 12,529.41, KOSPI soared 29.00 points or 1.25% to 2,356.89 and Jakarta Composite was up by 15.98 points or 0.32% to 4,942.71.