Sensex, Nifty gain for third consecutive day

Indian equity benchmarks extended their gains for the third straight session on Wednesday, with Metal, IT and TECK stocks trading firm throughout the session amid positive global cues. The benchmarks staged a gap up opening, as the Organization for Economic Co-operation and Development (OECD) in its interim economic outlook has 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. Sentiments remained positive as Crisil in its report stated that the production-linked incentive (PLI) scheme that seeks to push domestic manufacturing in as many as 14 sectors has the potential to generate additional revenue worth Rs 35-40 lakh crore over the next five years.

However, the benchmarks came off intraday highs in noon deals on the back of weakness in index heavyweights like ONGC, Kotak Mahindra Bank, ITC and HDFC Bank. Traders got cautious amid reports that a majority of CFOs interviewed see the long-term and financial impact of the global pandemic as one of their top challenges over the next three years. According to a survey, the most pressing issue at hand for CFOs (chief financial officers) is long-term business and financial impact of global pandemic, with almost 80 per cent of respondents listing this as their top challenge over the next three years.  But, key indices regained traction to end higher, as traders found some solace with Minister of State for Finance Anurag Thakur’s statement that 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.

On the global front, Asian markets ended mostly higher on Wednesday following the broadly positive lead 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. European markets were trading higher, as data from the statistical office Insee showed France's industrial production grew 3.3 percent month-on-month in January, reversing a 0.7 percent fall in December. Back home, on the sectoral front, auto stocks were in focus with data from the Federation of Automobile Dealers Associations (FADA) showing that retail sales of passenger vehicles rose by 10.59 per cent in February 2021 to 2,54,058 units from 2,29,734 units in the year ago period, while two-wheeler sales dropped by 16.08 per cent to 10,91,288 units from 13,00,364 units in the corresponding period last year. There was some reaction in renewable energy sector stocks as Moody's Investors Service in its latest report said that close to 15-20 per cent of wind and solar power projects underperformed during 2019-20.

Finally, the BSE Sensex rose 254.03 points or 0.50% to 51,279.51, while the CNX Nifty was up by 76.40 points or 0.51% to 15,174.80. 

The BSE Sensex touched high and low of 51,430.43 and 51,048.93, respectively. There were 22 stocks advancing against 7 stocks declining, while 1 stock remain unchanged on the index on the index.    

The broader indices ended in green; the BSE Mid cap index rose 0.77%, while Small cap index was up by 0.95%.

The top gaining sectoral indices on the BSE were Metal up by 1.82%, IT up by 1.58%, TECK up by 1.40%, Healthcare up by 1.23% and Basic Materials up by 1.15%, while Oil & Gas down by 0.93%, Utilities down by 0.58%, Energy down by 0.40% and Power down by 0.22% were the top losing indices on BSE.

The top gainers on the Sensex were Bajaj Finance up by 2.34%, Sun Pharma up by 2.18%, Tech Mahindra up by 2.06%, Axis Bank up by 2.02% and Bajaj Auto up by 1.80%. On the flip side, ONGC down by 2.05%, Kotak Mahindra Bank down by 0.89%, ITC down by 0.63%, HDFC Bank down by 0.44% and Power Grid down by 0.39% were the top losers.

Meanwhile, the Organization for Economic Co-operation and Development (OECD) in its interim economic outlook has 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. OECD said activity moved above pre-pandemic levels in India, helped by strong fiscal and quasi-fiscal measures and a recovery in manufacturing and construction.

However, it pegged economic growth rate to come down to 5.4 per cent in 2022-23, which would be higher by 0.6 percentage points than its earlier estimates.  According to the OECD, that year, India would share its fastest-growing large economy tag with Indonesia. The Indian economy was projected to decline by 8 per cent in the current fiscal year. However, OECD believes that contraction would be less steep at 7.4 per cent.

In the report, titled Strengthening the recovery: The need for speed, OECD said fiscal measures announced in India and a few other countries would help growth in 2021-22 as well. Additional discretionary fiscal measures announced in several countries during the past three months will add to the overall support, including in the US, Japan, Germany, Canada, and India. The report also unveiled major upgrades to its global outlook, saying that economic prospects have improved markedly in recent months thanks to the deployment of coronavirus vaccines and additional stimulus announcements.

The CNX Nifty traded in a range of 15,218.45 and 15,100.85. There were 35 stocks advancing against 15 stock declining on the index.

The top gainers on Nifty were Eicher Motors up by 3.10%, JSW Steel up by 3.04%, Hindalco Industries up by 2.33%, Tata Steel up by 2.31% and Bajaj Finance up by 2.27%.

On the flip side, SBI Life Insurance down by 3.48%, ONGC down by 1.84%, Indian Oil Corporation down by 1.54%, HDFC Life Insurance down by 1.54% and Kotak Mahindra Bank down by 0.91% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 0.61 points or 0.01% to 6,730.95, France’s CAC rose 34.88 points or 0.59% to 5,959.85 and Germany’s DAX was up by 58.97 points or 0.41% to 14,496.91.

Asian markets ended mostly higher on Wednesday tracking positive cues from Wall Street overnight. While, fall in US bond yields also eased concerns about surging inflation, supporting market sentiments. However, Seoul shares declined as foreigners and institutions locked in profits. Chinese shares ended almost flat as investors reacted to mixed inflation data and signs of policy tightening. Consumer prices in China were down 0.2% year-on-year in February, which exceeded expectations for a decline of 0.4% and was up from -0.3% in the previous month. The producer prices were up an annual 1.7%, exceeding expectations for an increase of 1.5% and up sharply from 0.3% in January. Japanese shares ended with a flat note amid profit booking before the year-end selloff by funds.