Key indices add gains in morning deals

Indian equity markets extended gains and now traded around a percent higher in morning deals, on fresh buying by investors. Sentiments remained up-beat with the finance ministry stating that the Indian economy is likely to do better than the projection of an 8 per cent shrinkage in the current fiscal as economic activity gathers pace with mild stiffening of pandemic curve and the rollout of vaccines The markets were also taking support with the Federation of Indian Chambers of Commerce and Industry (FICCI) in its latest survey report stated that its Overall Business Confidence Index has witnessed a decadal high of 74.2 in the current round on account of improvement in present conditions as well as expectations. The Index had stood at70.9 in the previous survey and 59 a year ago. Traders overlooked Chief Economic Advisor (CEA) Krishnamurthy Subramanian’s statement that the country’s financial sector has not really grown as fast as it should have and is still very, very small. For instance, he said, while India is the fifth largest economy in the world, the largest Indian financial institution - SBI - is ranked 55th in the world.

On the global front, Asian markets were trading mostly in red, even as encouraging economic data from the world's two largest economies as well as the passing of President Joe Biden's $1.9 trillion spending package by the U.S. Senate. Back home, on the sectoral front, chemical sector stocks remained in watch as the government is considering launching a production linked incentive (PLI) scheme in the chemical sector to boost domestic manufacturing and exports.

The BSE Sensex is currently trading at 50894.86, up by 489.54 points or 0.97% after trading in a range of 50575.16 and 50985.77. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 1.07%, while Small cap index was up by 1.32%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 3.03%, PSU up by 2.74%, Energy up by 2.37%, Metal up by 2.29% and Capital Goods up by 2.09%, while there were no losing sectoral indices on the BSE.

The top gainers on the Sensex were ONGC up by 5.40%, Larsen & Toubro up by 3.12%, Axis Bank up by 2.65%, NTPC up by 2.34% and Reliance Industries up by 2.20%. On the flip side, Bajaj Auto down by 1.80%, Ultratech Cement down by 1.73%, Asian Paints down by 0.71%, Bajaj Finance down by 0.64% and Titan Co down by 0.45% were the top losers.

Meanwhile, the finance ministry has said that the Indian economy is likely to do better than the projection of an 8 per cent shrinkage in the current fiscal as economic activity gathers pace with mild stiffening of pandemic curve and the rollout of vaccines. The Department of Economic Affairs in its monthly report said the recovery of global output has slowed following the re-imposition of lockdowns in advanced countries amid renewed COVID-19 waves and its emerging variants. However, economic activity in India has gathered pace with mild stiffening of the COVID-19 curve, failing to deter a steady uptick in consumer sentiment, which has been bolstered by the inoculation drive.

The report further said often overlooked in the spate of COVID-19 vaccine development and ongoing inoculation drive, social distancing poses as a social vaccine that also needs to be continuously administered for health and economy to make a quick recovery in India as well as abroad. The social vaccine is as important as the real vaccine. It also said positive GDP growth in Q3 of FY21 – for the first time since the onset of the pandemic – adds to the positive sentiment as the economy is set to close the year with activity levels higher than measured in the second advance estimates of GDP.

It further said the Reserve Bank's industrial outlook survey (IOS) conducted in Q3 of FY21 has also re-affirmed this optimism, with respondents indicating a strengthening of production, order books and employment during the third quarter, driven by easing of lockdowns, re-opening of businesses and improvement in the availability of finance from banks and internal sources.

The CNX Nifty is currently trading at 15081.45, up by 143.35 points or 0.96% after trading in a range of 14984.60 and 15111.15. There were 36 stocks advancing against 14 stocks declining on the index.

The top gainers on Nifty were GAIL India up by 5.84%, ONGC up by 5.22%, UPL up by 4.40%, Larsen & Toubro up by 3.41% and Indian Oil Corporation up by 3.25%. On the flip side, Ultratech Cement down by 1.66%, Bajaj Auto down by 1.61%, Bajaj Finance down by 0.90%, Asian Paints down by 0.78% and Hero MotoCorp down by 0.63% were the top losers.

Asian markets were trading mostly in red; Hang Seng decreased 389.36 points or 1.34% to 28,708.93, Nikkei 225 slipped 159.91 points or 0.55% to 28,704.41, Shanghai Composite declined 35.48 points or 1.01% to 3,466.51, KOSPI fell 22.76 points or 0.75% to 3,003.50 and Jakarta Composite lost 11.78 points or 0.19% to 6,246.97.

On the flip side, Taiwan Weighted strengthened 7.24 points or 0.05% to 15,862.47 and Straits Times advanced 53.77 points or 1.78% to 3,067.62.