Benchmarks trade firm in early deals

Indian equity benchmarks made positive start on Friday tracking overnight gains on Wall Street. Markets are trading firm in early deals on the back of buying in all the sector indices except Energy. Sentiments got a boost with report that investments through participatory notes (P-notes) in the Indian capital market surged to Rs 78,686 crore at October-end, making it the highest level in 14 months, on enhanced global liquidity and measures taken by the government back home. Some support also came as the Reserve Bank announced to conduct simultaneous purchase and sale of government securities under open market operations (OMOs) for Rs 10,000 crore each on November 26. The decision was taken after a review of the current liquidity and financial conditions. Besides, ICRA said that the contraction in the country’s Gross Domestic Product (GDP) may have narrowed to 9.5 per cent in the second quarter of the current fiscal from 23.9 per cent in the April-June quarter as the economy recovered from the lows of the pandemic-induced lockdown. However, gains remained limited as Global forecasting firm Oxford Economics revised downwards its India growth forecast over the medium term to an average 4.5 per cent over 2020-25, from its pre-pandemic projection of 6.5 per cent. In a research note, it said India's post-COVID-19 scars could be among the worst in the world.

On the global front, Asian markets were trading mixed amid worries about rising coronavirus cases around the world and the economic impact of new lockdowns. Investors also turned cautious following news the US Treasury Department is looking to end some of the Federal Reserve emergency lending programs that were initiated earlier this year due to the coronavirus pandemic. Also, the latest survey from Jibun Bank revealed that the manufacturing sector in Japan continued to contract in November, and at a faster pace, with a manufacturing PMI score of 48.3.

Back home, healthcare sector stocks will be in focus after Niti Aayog Member (Health) V K Paul said India’s overall spending on the health sector is low and the situation must be corrected. Emphasising that there is a need to request both the union and state governments to enhance spending on health, he said the COVID-19 experience will justify an increase in expenditure on health sector. In scrip specific development, TCS edged up after expanding partnership with home improvement firm Kingfisher. SpiceJet soared on easing concerns around return of Boeing's 737 Max planes.

The BSE Sensex is currently trading at 43792.45, up by 192.49 points or 0.44% after trading in a range of 43648.75 and 43889.40. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index jumped 0.90%, while Small cap index was up by 0.89%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 2.06%, Realty up by 1.55%, Power up by 1.08%, Capital Goods up by 1.06%, Utilities up by 1.05%, while Energy down by 1.03% was the sole losing index on BSE.

The top gainers on the Sensex were Titan Company up by 3.64%, Bajaj Finserv up by 2.60%, HDFC up by 2.41%, Tata Steel up by 2.14% and Nestle up by 2.10%. On the flip side, Reliance Industries down by 1.31%, ONGC down by 0.69%, ITC down by 0.56%, SBI down by 0.31% and Bharti Airtel down by 0.30% were the top losers.

Meanwhile, rating agency ICRA in its latest report has said that the Year-on-Year (YoY) contraction in India’s Gross Domestic Product (GDP) (at constant 2011-12 prices) is expected to narrow appreciably to 9.5 percent in the second quarter of the current fiscal (Q2FY21) from 23.9 percent in Q1FY21, as the economy recovered from the lows of the pandemic-induced lockdown. The Central Statistics Office (CSO) will release the GDP data for the second quarter of FY21 on November 27.

Similarly, the report stated that the contraction in the Gross Value Added (GVA) at basic prices is expected to have moderated considerably to 8.5 per cent in the July-September quarter from 22.8 percent in the previous three months. It noted that the ease in GVA would be led by industry to (-) 9.3 percent from (-) 38.1 percent, driven primarily by manufacturing and construction and services to (-) 10.2 percent from (-) 20.6 percent). It also said a substantial recovery in manufacturing and construction is likely to underpin the expected improvement in the performance of the industrial GVA in the second quarter of the current fiscal.

According to the report, various sectors of manufacturing recorded an improvement in demand and volumes in the September quarter although the performance was admittedly uneven. In addition to the continued cost-cutting measures, it said the availability of raw material inventory that had been procured previously at subdued costs, supported the earnings of the manufacturing entities in the just-concluded quarter relative to Q1 FY2021.

he CNX Nifty is currently trading at 12823.25, up by 51.55 points or 0.40% after trading in a range of 12784.40 and 12855.20. There were 29 stocks advancing against 20 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Titan Co up by 3.99%, Bajaj Finserv up by 2.53%, HDFC up by 2.42%, Nestle up by 2.07% and NTPC up by 1.95%. On the flip side, UPL down by 1.54%, Reliance Industries down by 1.46%, Adani Ports & SEZ down by 0.98%, SBI Life Insurance down by 0.97% and Dr. Reddy’s Lab down by 0.87% were the top losers.

Asian markets were trading mixed; Straits Times surged 22.74 points or 0.82% to 2,799.74, Hang Seng gained 88.83 points or 0.34% to 26,445.80, Jakarta Composite added 1.99 points or 0.04% to 5,596.05 and Shanghai Composite was up by 3.44 points or 0.10% to 3,366.53. On other hand, Nikkei 225 lost 193.56 points or 0.76% to 25,440.78, Taiwan Weighted slipped 10.25 points or 0.07% to 13,712.18 and KOSPI fell 1.80 points or 0.07% to 2,545.62.