Markets trade in fine-fettle in early deals; IT, Auto stocks lead

Continuing with the gains witnessed in the previous session, Indian equity benchmarks made optimistic start on Wednesday following positive global cues. Markets are trading in fine-fettle in early deals with gains of over 0.60% each. Sensex and Nifty were trading above their psychological levels of 51,300 and 15,190, respectively. Broad-based buying in IT, Auto, Consumer Durables counters aided the domestic indices. Sentiments got a boost as the Organization for Economic Co-operation and Development (OECD) raised the projection for India’s economic growth rate by 4.7 percentage points at 12.6 per cent for 2021-22. That would enable India to retain its earlier tag of the fastest growing large economy in the world. Adding more optimism, CRISIL projected India’s economy to grow by 11 per cent in the next fiscal year against expected contraction of 8 per cent in 2020-21. Meanwhile, India reported 16,846 fresh Covid-19 cases on Wednesday pushing the overall tally to 11,261,470, according to Worldometer. The death toll from the deadly infection jumped to 158,079.

On the global front, most of the Asian markets were trading higher following the broadly positive lead overnight from Wall Street. The positive trend in global stock markets following a pullback by long-term treasury yields ahead of auctions in the coming days and greater momentum in vaccination drive aided sentiment. Technology stocks are tracking overnight gains on Wall Street. Back home, MSME stocks were in focus as Minister of State for Finance Anurag Thakur said banks have sanctioned loans worth Rs 2.46 lakh crore to about 92 lakh accounts under the Rs 3-lakh crore Emergency Credit Line Guarantee Scheme for the MSME sector. In scrip specific development, Future Retail was marginally higher amid report that Reliance Industries agreed to extend operational support to the company to prevent its collapse. Vodafone Idea gained on reports it is planning network expansion in six circles.

The BSE Sensex is currently trading at 51363.28, up by 337.80 points or 0.66% after trading in a range of 51267.01 and 51430.43. There were 25 stocks advancing against 5 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.84%, while Small cap index was up by 0.62%.

The top gaining sectoral indices on the BSE were IT up by 1.26%, Auto up by 1.24%, Consumer Durables up by 1.23%, Realty up by 1.13%, Consumer discretionary up by 1.03%, while Telecom down by 0.46% was the sole losing index on BSE.

The top gainers on the Sensex were Indusind Bank up by 2.69%, Bajaj Finance up by 2.02%, Mahindra & Mahindra up by 1.96%, Tech Mahindra up by 1.59% and HCL Technologies up by 1.43%. On the flip side, ONGC down by 1.75%, Bharti Airtel down by 0.58%, ITC down by 0.48%, Nestle down by 0.33% and Kotak Mahindra Bank down by 0.13% were the top losers.

meanwhile, projecting next year's growth to be a story of two halves, with the low base-effect lifting the growth engine in the first half and a broad-based recovery in the second, Credit rating agency Crisil in its latest report has said that higher infrastructure investments and the production-linked incentive (PLI) scheme will drive investments and thus Gross domestic product (GDP). Like others, it also expects growth to rebound to 11 percent in the financial year 2021-22, after an estimated 8 percent contraction this fiscal.

The agency sees four positive drivers converging next fiscal -- people learning to live with the new normal after the pandemic, flattening of the coronavirus infection curve, more vaccinations, and investment-focused government spending. But, it said the pace of growth will be different in the first and second halves as was in the outgoing year, with the first half benefitting optically from the low-base effect, second half seeing a more broad-based pick-up in economic activity, owing to rising commodity prices, large-scale vaccination and a likely stronger global growth,

The report was also quick to warn that recovery will not be easy, with small businesses and the urban poor still suffering from the impact of the pandemic, and urban markets and services still lagging manufacturing in recovery, even as the rural economy remains more resilient. Trade has also normalized faster than the rest of the economy with both exports and imports scaling back to pre-pandemic levels. While export recovery has been good for large industries and agriculture and allied sectors, it remains weak for gems and jewellery, garments, and leather products that are labour-intensive and small in scale.

The CNX Nifty is currently trading at 15190.25, up by 91.85 points or 0.61% after trading in a range of 15161.60 and 15218.45. There were 38 stocks advancing against 12 stocks declining on the index.

The top gainers on Nifty were Eicher Motors up by 2.90%, Indusind Bank up by 2.55%, Mahindra & Mahindra up by 2.17%, Wipro up by 2.06% and Bajaj Finance up by 1.75%. On the flip side, ONGC down by 1.71%, SBI Life Insurance down by 1.27%, UPL down by 1.24%, HDFC Life Insurance down by 0.60% and Bharti Airtel down by 0.58% were the top losers.

Asian markets were trading mostly higher; Hang Seng soared 130.77 points or 0.45% to 28,904.00, Taiwan Weighted rose 78.48 points or 0.50% to 15,931.57, Jakarta Composite jumped 63.23 points or 1.02% to 6,262.88, and Shanghai Composite was up by 22.55 points or 0.67% to 3,381.84. On the other hand, Nikkei 225 fell 12.93 points or 0.04% to 29,015.01, Straits Times lost 29.06 points or 0.93% to 3,079.47 and KOSPI declined 8.37 points or 0.28% to 2,967.75.