Indices add gains in morning deals

Indian equity benchmarks added gains in morning session, as data showed that India's economy returned to growth in the December quarter, while progress in US stimulus package lifted sentiment. Buying interest was broad-based led by auto, Consumer Durables and IT shares. Sentiments remained up-beat as data released by the Ministry for Commerce and Industry showed that the core sector index, which measures output of eight infrastructure industries, rose marginally by 0.1 per cent in January, indicating a wobbly recovery from the pandemic shock. Output in five of the eight crucial sectors fell on a year-on-year (YoY) basis. Adding to the optimism, the finance ministry said the GDP growth of 0.4 per cent in the December quarter shows that the economy has returned to pre-pandemic times and reflects further strengthening of a V-shaped recovery. It also said the initial policy choice of ‘lives over livelihoods’ succeeded by ‘lives as well as livelihoods’ is now bearing positive results converging with the foresight the government had about an imminent V-shaped recovery.

On the global front, Asian markets were trading in green as some semblance of calm returned to bond markets after last week's wild ride, while progress in the huge US stimulus package underpinned optimism about the global economy and sent oil prices higher. China's official manufacturing PMI out over the weekend missed forecasts, but Japanese figures showed the fastest growth in two years. Investors are also counting on upbeat news from a raft of U.S. data due this week including the February payrolls report. Back home, on the sectoral front, power stocks were trading in green despite report stated that total dues owed by electricity distribution companies to power producers rose nearly 24 percent to Rs 1,36,966 crore in December 2020 compared to the same month a year ago, reflecting stress in the sector.

The BSE Sensex is currently trading at 49979.11, up by 879.12 points or 1.79% after trading in a range of 49485.00 and 50021.63. There were 29 stocks advancing against 1 stock declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 1.22%, while Small cap index was up by 1.53%.

The top gaining sectoral indices on the BSE were Auto up by 2.39%, Consumer Durables up by 2.27%, IT up by 2.13%, PSU up by 2.13% and Bankex up by 2.12%, while Telecom down by 2.57% was the lone losing index on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 5.41%, Tech Mahindra up by 3.86%, Titan Company up by 3.85%, ONGC up by 3.82% and Power Grid up by 3.51%. On the flip side, Bharti Airtel down by 4.00% were the top losers.

Meanwhile, the central government’s fiscal deficit soared to Rs 12.34 lakh crore or 66.8 per cent of the revised budget estimates at the end of January of 2020-21 (FY21), as per the data released by the Controller General of Accounts (CGA). The fiscal deficit at the end of January in the previous financial year was 128.5 per cent of the Revised Estimates (RE).

In the current fiscal ending March 31, the fiscal deficit is likely to touch Rs 18.48 lakh crore or 9.5 per cent of the GDP. The lockdown imposed to curb spreading of coronavirus infections had significantly impacted business activities and in turn contributed to sluggish revenue realisation. The fiscal deficit or gap between the expenditure and revenue had breached the annual target in the month of July during this financial year. The government received Rs 12.83 lakh crore - 80 per cent of the RE 2020-21 - up to January, 2021. This included Rs 11.01 lakh crore of tax revenue.

The tax revenue collection was 82 per cent of the RE of 2020-21 as compared to 66.3 per cent of the RE (2019-20) during the same period last fiscal. Non-tax revenue was 67 per cent of the RE. During the corresponding period of the last fiscal, it was 73 per cent. According to the CGA data, total expenditure incurred stood at Rs 25.17 lakh crore or 73 per cent of the RE in the current financial year. Last fiscal, it was 84.1 per cent of the RE during the same period.

For current financial year (FY21), the government had initially pegged the fiscal deficit at Rs 7.96 lakh crore or 3.5 per cent of the GDP in the budget presented in February 2020. However, as per revised estimates in the Budget 2021-22, the fiscal deficit in the year ending March is estimated to soar up to 9.5 per cent of the GDP or Rs 18,48,655 crore. This will be due to rise in expenditure on account of the outbreak of COVID-19 and moderation in revenue. Fiscal deficit had soared to a seven-year high of 4.6 per cent of the GDP in 2019-20, mainly due to poor revenue realisation.

The CNX Nifty is currently trading at 14794.45, up by 265.30 points or 1.83% after trading in a range of 14638.85 and 14797.95. There were 48 stocks advancing against 2 stocks declining on the index.

The top gainers on Nifty were Mahindra & Mahindra up by 4.93%, ONGC up by 4.86%, UPL up by 4.32%, Power Grid up by 3.94% and Titan Company up by 3.90%. On the flip side, Bharti Airtel down by 3.92% and SBI Life Insurance down by 0.94% were the top losers.

Asian markets were trading in green; Nikkei 225 surged 610.58 points or 2.11% to 29,576.59, Hang Seng increased 348.17 points or 1.2% to 29,328.38, Jakarta Composite soared 68.04 points or 1.09% to 6,309.84, Straits Times advanced 26.07 points or 0.88% to 2,975.11 and Shanghai Composite gained 18.22 points or 0.52% to 3,527.30.