Markets trade higher in early deals; Nifty surpasses 13,150 mark

Indian equity benchmarks made positive start on Thursday tracking gains in global peers. Markets were trading higher with notable gains in early deals on the back of buying in Metal, Utilities and PSU stocks. Sentiments got a boost with Niti Aayog Vice Chairman Rajiv Kumar’s statement that the Indian economy is coming out of the pandemic-induced degrowth and GDP growth will enter the positive territory in the fourth quarter of this fiscal. Adding optimism, ICRA Ratings in its latest report has said that the Indian corporate sector, which gradually returned to normalcy from the second quarter of the current fiscal, is likely to sustain improvement in the third quarter, aided by strong festive demand. Meanwhile, on Wednesday, India reported 33,761 fresh Covid-19 cases. Its case tally now stands at 9,533,471. The country's death toll has mounted to 138,657.

On the global front, most of the Asian markets were trading higher following the mostly positive cues overnight from Wall Street amid optimism over US stimulus talks and as the UK approved the COVID-19 vaccine candidate developed by Pfizer and BioNTech. Data showing that the services sector in China continued to expand at a faster rate also boosted sentiment.

Back home, Tech stocks were in limelight after a California federal judge in the US struck down two of Donald Trump administration's recent rules meant to drastically curtail the number of visas issued to skilled foreign workers every year. In scrip specific development, DHFL surged on reports that lenders to the company have moved the Mumbai bench of National Company Law Tribunal (NCLT) to initiate personal insolvency proceedings against the erstwhile promoters Kapil and Dheeraj Wadhwan.

The BSE Sensex is currently trading at 44739.01, up by 120.97 points or 0.27% after trading in a range of 44705.04 and 44953.01. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.69%, while Small cap index was up by 0.62%.

The top gaining sectoral indices on the BSE were Metal up by 1.51%, Utilities up by 0.87%, PSU up by 0.83%, Consumer Durables up by 0.83%, Basic Materials up by 0.73%, while Telecom down by 0.74%, TECK down by 0.18%, IT down by 0.13% were the few losing indices on BSE.

The top gainers on the Sensex were Maruti Suzuki up by 2.30%, Tata Steel up by 2.11%, HDFC Bank up by 1.37%, HCL Technologies up by 1.26% and Tech Mahindra up by 1.05%. On the flip side, Axis Bank down by 1.04%, Bharti Airtel down by 0.82%, Infosys down by 0.70%, Ultratech Cement down by 0.61% and Mahindra & Mahindra down by 0.56% were the top losers.

Meanwhile, Moody's Investors Service has said that conditions will improve for Indian corporates next year as economic activity picks up steam post-lockdown and earnings grow on the back of widespread demand revival across sectors. It added that most companies' earnings will grow as demand starts to recover following a sharp slump, and financially strong companies will maintain good access to funding, but speculative-grade issuers will face challenges. It noted that broad-based demand revival and a low base in 2020 will support strong GDP growth of 10.8 per cent in India in fiscal 2022 ending March 2022, following a decline of around 10.6 per cent in fiscal 2021 - the country's first contraction in four decades.

The agency said in 2021, conditions will improve for Indian corporates as economic activity gathers pace post-lockdown and earnings grow on the back of widespread demand revival across sectors, underpinning Moody's stable outlook for the corporates next year. It said ‘A combination of higher earnings and reduced capital spending will support deleveraging over the next 12-18 months’. It added overall recovery will remain fragile as new infections continue to grow - although at a slower rate - and therefore new lockdowns cannot be ruled out, which would hinder consumer demand and recovery.

It said the low interest rate environment and widespread credit availability will allow corporates with strong balance sheets to refinance and grow. But liquidity will be tight for financially weaker issuers, exacerbating their operating challenges. Moody's rates 21 Indian corporates across five key sectors: oil and gas, telecommunications, automobile manufacturers and suppliers, steel and mining. It said the outlook for the Indian corporate sector reflects its expectations for fundamental business conditions for the sector over the next 12-18 months.

The CNX Nifty is currently trading at 13161.60, up by 47.85 points or 0.36% after trading in a range of 13143.90 and 13216.60. There were 35 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were Maruti Suzuki up by 3.80%, Hindalco up by 2.63%, GAIL India up by 2.27%, Tata Steel up by 2.15% and HDFC Life Insurance up by 1.76%. On the flip side, SBI Life Insurance down by 1.36%, Bharti Airtel down by 1.04%, Infosys down by 0.98%, Grasim Industries down by 0.78% and Axis Bank down by 0.74% were the top losers.

Asian markets were trading mostly higher; Nikkei 225 rose 1.69 points or 0.01% to 26,802.67, Straits Times increased 2.87 points or 0.10% to 2,813.82, Hang Seng surged 149.58 points or 0.56% to 26,682.16, Taiwan Weighted advanced 35.51 points or 0.25% to 14,024.65, KOSPI gained 3.64 points or 0.14% to 2,679.54, and Jakarta Composite added 16.38 points or 0.28% to 5,830.37, while Shanghai Composite was down by 3.19 points or 0.09% to 3,446.19.