Post Session: Quick Review

Wednesday turned out to be a wonderful day for Indian equity benchmarks, with both Sensex and Nifty ending on a strong note, as bulls held a tight grip over the Dalal Street. The start of the day was on higher note, amid assurances from the government that it had enough COVID-19 vaccine doses to cover its population. The government said there were plenty of COVID-19 vaccines for the country even though it has sent quantities abroad. Sentiments got a boost as principal economic advisor to the finance ministry Sanjeev Sanyal said Indian economy is recovering faster than expected and the government will spend on building infrastructure rather than boosting consumer demand artificially.

Markets maintained their gaining rally during the whole trading session, as domestic sentiments were positive, after India's services activity expanded at the fastest rate in a year during February, while employment fell further and companies noted the sharpest rise in overall expenses. The seasonally adjusted India Services Business Activity Index rose from 52.8 in January to 55.3 in February, pointing to the sharpest rate of expansion in output in a year amid improved demand and more favourable market conditions.

In the second half of the session, key indices added more gains, taking support with Former Niti Aayog Vice Chairman Arvind Panagariya’s statement that India's economy is on an 'upswing' and the government's plans for increased spending comes in the backdrop of pro-growth reforms. However, he said that it might take longer to become a $5 trillion economy due to the coronavirus pandemic-induced disruptions. Some support also came as RBI governor Shaktikanta Das expressed optimism about the overall COVID-19 situation following the rollout of the vaccines and complimented all the SAARC central banks for their efforts in combating the pandemic.

On the global front, European markets were trading higher with investors in the U.K. keen to see what taxation and spending plans the British government reveals in the annual budget statement. Asian markets ended higher on Wednesday, as the services sector in China continued to expand in February, albeit at a slower pace, the latest survey from Caixin showed on Wednesday with a services PMI score of 51.5. That's down from 52.0 in January, although it remains above the boom-or-bust line of 50 that separates expansion from contraction. Service providers indicated that business activity rose in line with new work. Total new orders increased modestly overall, with the rate of growth likewise easing to a ten-month low.

The BSE Sensex ended at 51444.65, up by 1147.76 points or 2.28% after trading in a range of 50512.84 and 51539.89. There were 26 stocks advancing against 3 stocks declining, while 1 stock remained unchanged on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 1.45%, while Small cap index was up by 1.34%. (Provisional)

The top gaining sectoral indices on the BSE were Energy up by 3.74%, Metal up by 3.23%, Bankex up by 2.75%, Basic Materials up by 2.09% and IT up by 2.01%, while Auto down by 0.62% was the only losing index on BSE. (Provisional)

The top gainers on the Sensex were Bajaj Finserv up by 5.18%, Reliance Industries up by 4.52%, Bajaj Finance up by 4.47%, ICICI Bank up by 3.50% and HDFC up by 3.43%. On the flip side, Maruti Suzuki down by 1.26%, Bajaj Auto down by 1.24% and Mahindra & Mahindra down by 0.90% were the top losers. (Provisional)

Meanwhile, the growth of India’s service sector expanded at the fastest rate in the month of February, owing to a quicker increase in new orders. Moreover, the roll-out of coronavirus disease 2019 (COVID-19) vaccines led to an improvement in business confidence towards growth prospects.

As per the survey report, the seasonally adjusted Nikkei Services Business Activity Index surged to 55.3 in February from 52.8 in January. Further, the Nikkei India Composite PMI Output Index -- which measures both manufacturing and services - also jumped to 57.3 in February from 55.8 in January.

Despite ongoing growth of total new business, service sector employment fell further during February. A number of companies suggested that the COVID-19 pandemic restricted labour supply. The pace of job shedding accelerated from January, but was moderate overall.

On the price front, overall input costs increased in February, amid reports of higher freight, fuel and retail prices. Furthermore, the rate of inflation accelerated to the strongest since February 2013. However, competitive pressures prevented companies from lifting their own fees.

The CNX Nifty ended at 15245.60, up by 326.50 points or 2.19% after trading in a range of 14995.80 and 15273.15. There were 44 stocks advancing against 6 stocks declining on the index. (Provisional)

The top gainers on Nifty were Tata Steel up by 5.66%, Bajaj Finserv up by 5.25%, Reliance Industries up by 4.56%, Bajaj Finance up by 4.26% and UPL up by 4.10%. On the flip side, Hero MotoCorp down by 1.50%, Maruti Suzuki down by 1.24%, Bajaj Auto down by 1.09%, Mahindra & Mahindra down by 0.93% and BPCL down by 0.57% were the top losers. (Provisional)

European markets were trading higher; UK’s FTSE 100 increased 69.88 points or 1.06% to 6,683.63, France’s CAC increased 41.96 points or 0.72% to 5,851.69 and Germany’s DAX was up by 119.95 points or 0.85% to 14,159.75.

Asian markets ended higher on Wednesday as progress in US stimulus talks kept the market sentiment positive. Further, retreat in US Treasury yields from last week's highs and positive vaccine news also boosted sentiment among investors. Chinese shares ended with strong gains as a private survey showed slowing growth in China’s services sector activity last month. The latest survey from Caixin showed the services sector in the country continued to expand in February, albeit at a slower pace with a services PMI score of 51.5, a decline from January’s reading of 52. While, the private sector in Hong Kong moved into expansion territory in February, the latest survey from Markit Economics showed with services PMI score of 50.2, up from 47.8 in January. Japanese shares gained up on investor hopes of a swift global economic recovery from the pandemic-led recession. Although, the services sector in Japan continued to contract in February, albeit at a slower pace, the latest survey from Jibun Bank revealed with a services PMI score of 46.3, up from 46.1 in January.