Key indices end higher on Wednesday

Indian equity benchmarks ended higher with gains of around a percent on Wednesday led by gains in Auto, Telecom and Banking stocks. Markets made a positive start, as sentiments got boost on report that the International Monetary Fund (IMF) has raised its projection for India’s economic growth in the current financial year by one percentage point to 12.5 per cent. The forecast, published in the IMF’s World Economic Outlook, suggests India would again become the fastest-growing large economy in the world. In fact, India is the only country among major world economies that is projected to grow at a double-digit rate during FY22. China comes closest, with a forecast of 8.4 per cent economic expansion. Equity benchmarks added gains in morning deals, after the Reserve Bank of India (RBI) expectedly left interest rates unchanged at 4 percent and maintained an accommodative policy stance to nurture a fragile economic recovery after the three-day meeting of its monetary policy committee (MPC). This came amid a sharp new wave of Covid-19 cases in several states and local lockdowns, reigniting uncertainty regarding economic outlook in the immediate term. The FY22 growth projection was also maintained at 10.5 per cent.

Firm trade continued in late afternoon deals, even after India's services sector activities eased in March as growth was hit by the detrimental impact of the coronavirus pandemic and input costs remained elevated. The seasonally-adjusted India Services Business Activity Index fell from 55.3 in February to 54.6 in March. Though the rates of expansion softened, it indicated growth for the sixth consecutive month. In PMI parlance, a print above 50 means expansion while a score below 50 denotes contraction. Meanwhile, the Finance Ministry said banks and financial institutions have sanctioned Rs 14.96 lakh crore to over 28.68 crore beneficiaries in the last six years. Pradhan Mantri MUDRA Yojana (PMMY) was launched by Prime Minister Narendra Modi on April 8, 2015 to promote entrepreneurship.

On the flip side, European markets were trading higher, as the Eurozone's services PMI increasing from 45.7 to 49.6 in March. That was up from a preliminary reading of 48.8. Asian markets finished mostly in green on Wednesday, as the International Monetary Fund raised this year's global economic growth forecast to 6 percent from its earlier estimate of 5.5 percent, citing additional fiscal measures by advanced economies and the rollout of vaccines. Traders also looked ahead to the release of the minutes of the Federal Reserve's latest monetary policy meeting later in the day, for additional clues on the outlook for interest rates.

Back home, on the sectoral front, Cement stocks were keep buzzing as Icra said domestic cement demand is expected to be highest in the decade, estimated to surpass 340 million tonne in FY2022, driven by sustained rural housing demand and significant pick-up in infrastructure activity. On the supply side, the capacity addition is also expected to increase by 22-25 million tonne in FY2022. There was some buzz in Aviation stocks as ratings agency Icra said that India's domestic passenger traffic slipped to a 10-year low at an estimated 53.4 million in the just-concluded financial year. However, in the previous fiscal there were no passenger flight operations for almost two months due to the pandemic-induced lockdown.

Finally, the BSE Sensex rose 460.37 points or 0.94% to 49,661.76, while the CNX Nifty was up by 135.55 points or 0.92% to 14,819.05.  

The BSE Sensex touched high and low of 49,900.13 and 49,093.90, respectively. There were 27 stocks advancing against 3 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 0.82%, while Small cap index was up by 1.30%.

The top gaining sectoral indices on the BSE were Auto up by 1.69%, Telecom up by 1.57%, Bankex up by 1.57%, Metal up by 1.52%, Consumer Discretionary up by 1.36% while, Power down by 0.22% was the lone losing index on BSE.

The top gainers on the Sensex were SBI up by 2.25%, ICICI Bank up by 2.05%, Nestle up by 2.02%, Indusind Bank up by 2.02% and Mahindra & Mahindra up by 1.95%. On the flip side, Titan Company down by 0.78%, NTPC down by 0.47% and Hindustan Unilever down by 0.14% were the top losers.

Meanwhile, the International Monetary Fund (IMF) in its latest report has projected an impressive 12.5 percent growth rate for India in 2021, stronger than that of China, the only major economy to have a positive growth rate last year during the COVID-19 pandemic. It also said the Indian economy is expected to grow by 6.9 percent in 2022. Notably in 2020, India's economy contracted by a record eight percent.

According to the report, China, on the other hand which was the only major economy to have a positive growth rate of 2.3 per cent in 2020, is expected to grow by 8.6 per cent in 2021 and 5.6 per cent in 2022. After an estimated contraction of 3.3 per cent in 2020, the global economy is projected to grow at 6 per cent in 2021, moderating to 4.4 per cent in 2022. In 2020, the global economy contracted by 3.3 per cent. 

Nonetheless, it said the outlook presents daunting challenges related to divergences in the speed of recovery both across and within countries and the potential for persistent economic damage from the crisis.

The CNX Nifty traded in a range of 14,879.80 and 14,649.85. There were 43 stocks advancing against 7 stock declining on the index.     

The top gainers on Nifty were JSW Steel up by 4.62%, Wipro up by 2.54%, SBI Life Insurance up by 2.33%, SBI up by 2.28% and Britannia Industries up by 2.09%. On the flip side, Adani Ports &SEZ down by 2.49%, Tata Consumer Product down by 1.30%, UPL down by 1.04%, Titan Co down by 0.75% and NTPC down by 0.57% were the top losers. 

European markets were trading higher; UK’s FTSE 100 increased 47.06 points or 0.69% to 6,870.61, France’s CAC increased 5.94 points or 0.1% to 6,137.28 and Germany’s DAX increased 2.03 points or 0.01% to 15,214.71.

Asian markets finished mostly in green on Wednesday,  whetted by the upbeat forecast report for this year by International Monetary Fund projecting a 6% growth from its earlier estimate of 5.5%, strongest global expansion in four decades, pointing additional fiscal measures by advanced economies and the rollout of vaccines. However, stock markets in China and Hong Kong drifted lower citing concerns over policy tightening. Global investors also awaited for more cues on interest rates ahead to the release of the minutes of the Federal Reserve's latest monetary policy meeting later in the day.