Indian markets trade firm in early deals; Nifty reclaims 11,800 mark

Indian equity benchmarks made optimistic start on Monday tracking firm cues from Asian peers. Markets are trading in fine-fettle in early deals, with gains of over half a percent each, on the back of robust buying in Bankex, PSU and Utilities stocks. Traders took encouragement with Finance Minister Nirmala Sitharaman’s statement that the government has taken a host of initiatives, including a stimulus package totalling 10 per cent of the country's GDP and major reforms in the labour sector, to combat the impact of the coronavirus pandemic. Adding more optimism, ICRA stated that farm sentiments have remained buoyant mainly driven by healthy monsoon and further optimism of a good kharif crop. Market participants took note of report that a government-appointed panel said that the COVID-19 pandemic has peaked in India and can be controlled by early next year with minimal active cases by February-end if protective measures are followed. Meanwhile, the Reserve Bank of India’s (RBI) report stated that high incidence of non-performing assets (NPAs) in banks acts as a major roadblock in transmission of monetary policy actions of the Reserve Bank.

On the global front, most of the Asian markets were trading in green as data showing that China's economy continued to recover from the impact of the coronavirus pandemic and optimism about a US stimulus package before the presidential elections in November boosted investor sentiment. The National Bureau of Statistics said China's gross domestic product was up 4.9 percent on year in the third quarter of 2020, up from 3.2 percent in the three months prior. Back home, power stocks were in focus with the government data showing that India's power consumption grew 11.45 per cent to 55.37 billion units (BU) in the first half of October this year, mainly driven by buoyancy in industrial and commercial activities. In scrip specific development, HDFC Bank gained as its net profit rose by 18.4% to Rs 7,513.1 crore for second quarter ended September 2020 (Q2Fy21) on substantial growth in interest earnings and other income.

The BSE Sensex is currently trading at 40306.44, up by 323.46 points or 0.81% after trading in a range of 40211.22 and 40379.73. There were 25 stocks advancing against 5 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.37%, while Small cap index was up by 0.55%.

The top gaining sectoral indices on the BSE were Bankex up by 1.74%, PSU up by 1.64%, Utilities up by 1.54%, Realty up by 1.53%, Oil & Gas up by 1.29%, while IT down by 0.53%, TECK down by 0.48%, Healthcare down by 0.10% were the few losing indices on BSE.

The top gainers on the Sensex were ONGC up by 4.17%, HDFC up by 2.74%, NTPC up by 2.68%, Axis Bank up by 2.53% and ICICI Bank up by 2.18%. On the flip side, TCS down by 1.21%, Infosys down by 0.44%, Tech Mahindra down by 0.43%, Sun Pharma down by 0.15% and Titan Company down by 0.02% were the top losers.

Meanwhile, Finance Minister Nirmala Sitharaman has said that the government has taken a host of initiatives, including a stimulus package totalling 10 percent of the country's GDP and major reforms in the labour sector, to contain the spread of coronavirus disease (covid-19) pandemic and also to mitigate its social and economic impact. She noted that covid -19 pandemic continues to impact the developing and developed countries. She added that the hard fought gains in reducing the level of poverty, achieved over a number of years, are at great risk of being lost.

Sitharaman has stated that the government had announced the first stimulus of $23 billion to provide direct cash transfers and food security measures to poor. She pointed out that this was followed by a special economic package of $271 billion -- equivalent to 10 percent of India's GDP -- based on a clarion call by Prime Minister Narendra Modi for 'Aatmanirbhar Bharat' or self-reliant India. She also said measures have been announced to provide relief to the business, bring about major reforms in the labour sector by simplifying, amalgamating and rationalising 44 central labour laws, provide effective social protection to the migrant workers through National Portability of ration cards.

The minister further said the rural sector has been provided support by way of refinance support through NABARD, injection of additional liquidity of $27.13 billion in the farm sector and by way of increased allocation for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS). With regard to strengthening of health infrastructure in the wake of the pandemic, she said the government has committed $2.03 billion for this.

The CNX Nifty is currently trading at 11844.00, up by 81.55 points or 0.69% after trading in a range of 11820.80 and 11879.30. There were 35 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were ONGC up by 4.16%, Axis Bank up by 2.75%, HDFC up by 2.62%, NTPC up by 2.62% and ICICI Bank up by 2.41%. On the flip side, Divis Lab down by 1.45%, Grasim Industries down by 1.41%, TCS down by 1.37%, UPL down by 1.36% and Cipla down by 1.21% were the top losers.

Asian markets were trading mostly higher; Nikkei 225 surged 283.21 points, 1.21% to 23,693.84, Straits Times rose 14.82 points 0.59% to 2,547.84, Hang Seng jumped 168.03 points or 0.69% to 24,554.82, Taiwan Weighted soared 118.41 points 0.93% to 12,868.78 and KOSPI advanced 16.87 points or 0.72% to 2,358.40. On the other hand, Jakarta Composite fell 0.50 points or 0.01% to 5,102.91 and Shanghai Composite was down by 11.07 points or 0.33% to 3,325.29.