Markets trade in high sprit in early deals

Indian equity benchmarks made gap-up opening on Thursday, after losses in four consecutive sessions, tracking rally in global peers. Markets are trading in high sprit in early deals as broad-based gains were seen across all the sectors with consumer durables, auto and metal boosting the most. Support came in as a private report expressed optimism that India's sovereign rating would go up on the back of efforts being taken by the government to push economic reforms. Traders took note of report that Oil Minister Dharmendra Pradhan said India and the UAE discussed ways to strengthen energy cooperation, despite the nation asking its refiners to reduce their reliance on Middle Eastern oil. Besides, as per a report, even as concerns rise across the globe on the safety of the AstraZeneca-Oxford vaccine, India has found it safe, saying the nationwide inoculation drive can continue. The AstraZeneca-Oxford vaccine - called Covishield in India - is manufactured in the country by Pune-based Serum Institute of India, the world’s largest vaccine maker by volume. India reported 35,482 fresh Covid-19 cases on Wednesday pushing the overall tally to 11,438,464, according to Worldometer. The death toll from the deadly infection jumped to 159,249.

Global cues remained supportive with all the Asian markets trading higher following positive cues overnight from Wall Street. Investors are largely upbeat about a global economic recovery after the Federal Reserve projected the US economy to grow 6.5 percent this year, the fastest pace in four decades, due to the successful vaccine rollout and recently agreed on fiscal stimulus. The central bank also indicated its universally expected decision to keep interest rates at near-zero levels through 2023, despite an improving economic outlook. Back home, aviation stocks were in focus as Indian aviation regulator DGCA said around 78.27 lakh (7.8 million) domestic passengers travelled by air in February 2021 which is 36.71 per cent lower than the corresponding period last year. In scrip specific development, Vodafone Idea rallied on fund raising reports and amid report that it has added customers to its network for the first time in 15 months in January.

The BSE Sensex is currently trading at 50203.78, up by 402.16 points or 0.81% after trading in a range of 50087.08 and 50296.35. There were 27 stocks advancing against 3 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index surged 1.04%, while Small cap index was up by 0.91%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.98%, Auto up by 1.60%, Metal up by 1.52%, Consumer discretionary up by 1.30%, Bankex up by 1.23%, while IT down by 0.43%, TECK down by 0.22% were the only losing indices on BSE.

The top gainers on the Sensex were Bajaj Finance up by 2.64%, ONGC up by 2.19%, Mahindra & Mahindra up by 2.13%, Maruti Suzuki up by 2.09% and Larsen & Toubro up by 1.62%. On the flip side, Infosys down by 1.38%, Dr. Reddy’s Lab down by 0.96% and HCL Tech. down by 0.10% were the few losers.

Meanwhile, a joined survey carried out by FICCI-IBA has stated that asset quality of banks, which saw some improvement in the second half of 2020, is likely to worsen during the first six months of 2021. The survey was conducted on 20 banks, including public sector, private sector and foreign banks, representing about 59 per cent of the banking industry, as classified by asset size.

The survey showed in the current round of the survey, half of the respondent banks reported a decline in NPAs during the second half of 2020. About 78 percent of participating state-run banks have cited a reduction in NPA levels. However, in terms of outlook, nearly 68 percent of respondent bankers expect the NPA levels to be above 10 percent in the first half of 2021. Close to 37 percent of respondents expect NPA levels to be upwards of 12 percent.

It further stated that some of the high NPA risk sectors identified by majority of respondent bankers in the current round of survey include tourism and hospitality, MSME, aviation and restaurants. Around 55 per cent of respondents believe NPAs to rise substantially in the tourism and hospitality sector, while another 45 per cent reported that NPAs are likely to increase moderately in this sector. Another high NPA risk sector reported in the current round of survey is the MSME sector, with 84 per cent respondents expecting an increase in NPAs in this sector. Close to 89 per cent respondents also expect the restaurant sector to see an increase in NPAs, though only 26 per cent expect NPAs to increase substantially in this segment.

The CNX Nifty is currently trading at 14859.25, up by 137.95 points or 0.94% after trading in a range of 14808.10 and 14875.20. There were 46 stocks advancing against 4 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 2.79%, Tata Motors up by 2.76%, Bajaj Finance up by 2.62%, Maruti Suzuki up by 2.40% and ONGC up by 2.38%. On the flip side, Infosys down by 1.38%, Dr. Reddy’s Lab down by 0.98%, Divis Lab down by 0.43% and Britannia Industries down by 0.10% were the few losers.

Asian markets were trading in green; Nikkei 225 surged 251.38 points or 0.84% to 30,165.71, Straits Times rose 35.74 points or 1.15% to 3,145.39, Hang Seng jumped 461.32 points or 1.59% to 29,495.44, Taiwan Weighted advanced 122.45 points or 0.76% to 16,338.27, KOSPI soared 28.44 points or 0.93% to 3,075.94, Jakarta Composite added 48.24 points or 0.77% to 6,325.47, and Shanghai Composite was up by 18.78 points or 0.55% to 3,464.33.