Equity indices add more points in late afternoon session

Indian equity markets extended their gains in late afternoon session. Industrials, Auto, Capital Goods and Bankex sectors edged higher. Sentiment got boost after commerce ministry data said that the country’s exports grew 5.37 per cent year-on-year to $27.24 billion in January 2021, mainly driven by healthy growth in pharmaceuticals and engineering sectors. Support also came, as Union Budget document has said that the Indian economy is expected to rebound strongly in 2021-22. It further said that the real Gross Domestic Product (GDP) growth is projected to contract by 7.7 per cent in 2020-21 as compared to a growth of 4.2 per cent in 2019-20. On the global front, Asian markets were trading mostly in green on increased optimism about stimulus packages and global economic recovery, while retail investors retreated from GameStop and their new-found interest in silver. European markets were trading higher as investors were hopeful of a faster economic recovery, while technology shares led the advance after French IT consulting group Atos ended talks of a potential takeover of U.S. rival DXC Technology.

The BSE Sensex is currently trading at 49856.21, up by 1255.60 points or 2.58% after trading in a range of 49193.26 and 50154.48. There were 26 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 2.10%, while Small cap index was up by 1.68%.

The top gaining sectoral indices on the BSE were Industrials up by 3.73%, Auto up by 3.56%, Capital Goods up by 3.48%, Bankex up by 3.39% and Basic Materials was up by 3.39%, while Energy down by 0.28% were the only losing indices on BSE.

The top gainers on the Sensex were Ultratech Cement up by 7.21%, SBI up by 6.59%, HDFC Bank up by 5.89%, HDFC up by 5.34% and Larsen & Toubro up by 4.24%. On the flip side, Bajaj Finserv down by 2.35%, Reliance Industries down by 1.11% and Hindustan Unilever down by 0.66% were the top losers.

Meanwhile, after an announcement of union budget 2021, credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has said that the budget has proposed several structural measures which would improve the functioning of the financial sector in the near to medium term.

As per the report, the budget 2021 has proposed measures which are structurally positive for the banking sector, especially public sector banks (PSBs). The creation of an asset reconstruction company and an asset management company to acquire and consolidate the stressed assets of PSBs and offload the same to alternative investment funds could realise better value of stressed assets for PSBs, thereby reducing their provisioning requirements and therefore the need for the government of India to infuse more capital in these banks.

Ind-Ra further highlighted other positive measures for the banking sector include the focus on improving the access of bank deposits, up to Deposit Insurance and Credit Guarantee Corporation limit in case of a bank coming under stress. This would enhance the confidence of deposit holders.

The CNX Nifty is currently trading at 14661.80, up by 380.60 points or 2.67% after trading in a range of 14469.15 and 14731.70. There were 42 stocks advancing against 8 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 12.29%, Shree Cement up by 7.89%, SBI up by 7.19%, Ultratech Cement up by 6.98% and Grasim Industries up by 6.93%. On the flip side, HDFC Life Insurance down by 3.03%, Bajaj Finserv down by 2.64%, Hero MotoCorp down by 1.37%, SBI Life down by 1.05% and Reliance Industries down by 1.03% were the top losers.

Asian markets were trading mostly in green, Hang Seng increased 355.84 points or 1.23% to 29,248.70, Taiwan Weighted strengthened 349.96 points or 2.27% to 15,760.05, Nikkei 225 surged 271.12 points or 0.97% to 28,362.17, KOSPI rose 40.28 points or 1.32% to 3,096.81, Shanghai Composite gained 28.40 points or 0.81% to 3,533.68 and Straits Times was up by 19.53 points or 0.67% to 2,915.85. On the flip side, Jakarta Composite was down by 23.71 points or 0.39% to 6,043.84.

European markets were trading higher, UK’s FTSE 100 increased 37.61 points or 0.58% to 6,504.03, France’s CAC increased 81.81 points or 1.5% to 5,543.49 and Germany’s DAX was up by161.85 points or 1.19% to 13,783.87.