Sensex, Nifty remain in green terrain during late morning deals

Firm trade continued over the Dalal Street in late morning deals, with both Sensex and Nifty trading higher with notable gains. Positive cues from other Asian markets helped key indices to remain higher. Traders were positive, as industry body CII has suggested a graded road map towards competitive import tariffs over three years, with lowest or nil slab between zero to 2.5 per cent for raw materials, highest of 5 to 7.5 per cent for finished goods and 2.5 to 5 per cent for intermediates, as part of its pre-Budget recommendations to the government. The Confederation of Indian Industry (CII) has proposed the road map to encourage domestic manufacturing in alignment with global trade trends that would boost India's export competitiveness as per shifting global value chains in the next three to five years.

On the global front, Asian markets were trading higher, after Malaysia's exports rose sharply in November. The data from the Department of Statistics showed that exports rose 4.3 percent year-on-year to MYR 84.4 billion in November, after a 0.2 percent increase in October. Imports declined 9.0 percent annually to MYR 67.6 billion in November, following a 6.0 percent fall in the previous month. The trade surplus totaled MYR 16.8 billion in November, which was above the expected level of MYR 12.6 billion.

The BSE Sensex is currently trading at 47210.73, up by 237.19 points or 0.50% after trading in a range of 47148.24 and 47354.71. There were 26 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.07%, while Small cap index was up by 1.28%.

The top gaining sectoral indices on the BSE were Realty up by 3.20%, Consumer Durables up by 1.56%, Industrials up by 1.47%, Metal up by 1.39% and Telecom up by 1.17%, while there were no losing sectoral indices on the BSE.

The top gainers on the Sensex were Titan Company up by 2.06%, Ultratech Cement up by 1.48%, Indusind Bank up by 1.44%, Bharti Airtel up by 1.39% and SBI up by 1.29%. On the flip side, HDFC down by 0.58%, Hindustan Unilever down by 0.53%, HCL Tech down by 0.30% and Asian Paints down by 0.08% were the top losers.

Meanwhile, Reserve Bank of India (RBI) in its latest report has showed that demand conditions in the manufacturing sector returned to the recovery mode with a softer contraction of 4.3 per cent (Y-o-Y) in the second quarter of this fiscal (Q2FY21) in terms of nominal sales. It had sunk 41.1 per cent in the previous quarter that was hit by countrywide lockdowns due to COVID-19. The recovery was led by iron and steel, food products, cement, automobile and pharmaceuticals companies, showed the data on the performance of the private corporate sector during the second quarter of 2020-21.

The Central Bank said the data has been drawn from abridged quarterly financial results of 2,637 listed non-government non-financial (NGNF) companies. Manufacturing companies reported sales of Rs 5,99,479 crore in the second quarter, compared to Rs 3,97,233 crore in April-June of FY 2020-21. Nominal sales of non-IT services sector also registered lower contraction of 14.5 per cent (Y-o-Y) led by expansion in sales of telecommunication and real estate companies. Sales growth of IT sector companies remained steady at 3.6 per cent (Y-o-Y) in Q2 FY 2020-21.

As per the data, sales of non-IT firms and IT firms during the second quarter stood at Rs 80,842 crore and Rs 1,01,353 crore, respectively. Operating profits of manufacturing companies increased on the back of savings in expenditure; operating profits of services (both IT and non-IT) companies also increased in Q2:2020-21. On expenditure, it said input cost pressure from raw materials remained subdued for manufacturing sector in the July-September quarter of the fiscal.

According to the data, with rise in profits, interest coverage ratio (ICR) of manufacturing companies improved to 4.6 in the second quarter of 2020-21 from 2.4 in the previous three-month period. The ICR of non-IT services companies remained below one. Also, profit margins improved across manufacturing and services companies on account of rise in profit from cost saving.

The CNX Nifty is currently trading at 13839.10, up by 89.85 points or 0.65% after trading in a range of 13811.55 and 13865.45. There were 44 stocks advancing against 5 stocks declining, while 1 stock remains unchanged on the index.

The top gainers on Nifty were Tata Motors up by 4.23%, SBI Life Insurance up by 2.80%, Adani Ports & SEZ up by 2.65%, JSW Steel up by 2.57% and HDFC Life Insurance up by 2.50%. On the flip side, Hindustan Unilever down by 0.55%, HDFC down by 0.39%, Britannia down by 0.26%, HCL Tech. down by 0.17% and Shree Cement down by 0.05% were the top losers.

Asian markets were trading higher; Nikkei 225 surged 137.94 points or 0.52% to 26,794.55, Taiwan Weighted strengthened 125.02 points or 0.87% to 14,456.44, Hang Seng increased 4.64 points or 0.02% to 26,391.20, KOSPI rose 11.94 points or 0.43% to 2,818.80, Straits Times advanced 6.71 points or 0.24% to 2,848.75, Shanghai Composite gained 10.13 points or 0.3% to 3,406.69 and Jakarta Composite soared 62.79 points or 1.04% to 6,071.50.