Sensex, Nifty remain higher in late morning deals

Indian equity benchmarks remained higher in late morning session, with both Sensex and Nifty holding their notable gains. Positive cues from other Asian markets helped key indices to trade in green terrain. Traders got relief, after industry body Assocham has demanded from the government a 'concentrated and right kind' of relief package for MSME sector, which was most affected by covid-19 pandemic. Besides, the Central government has invited research and development (RandD) proposals from scientists for the invention of oxygen concentrators in order to curb the COVID-19 pandemic. This initiative will soon catalyse R and D on critical components and innovations concerning Make-in-India oxygen concentrators to meet the emerging healthcare requirements to combat the COVID-19, the government said.

On the global front, Asian markets were trading mostly in green, even after Hong Kong's consumer prices increased in April. The data from the Census and Statistics Department showed that the composite consumer price index rose 0.7 percent year-on-year in April, following a 0.5 percent increase in March. Excluding the effects of all government one-off relief measures, the composite consumer price index increased 0.3 percent yearly in April, after a 0.2 percent rise in the previous month.

The BSE Sensex is currently trading at 50765.69, up by 225.21 points or 0.45% after trading in a range of 50465.90 and 50855.32. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.75%, while Small cap index was up by 0.73%.

The top gaining sectoral indices on the BSE were Power up by 1.72%, Realty up by 1.48%, PSU up by 1.42%, Capital Goods up by 1.41% and Utilities up by 1.31%, while Metal down by 1.45%, Basic Materials down by 0.73%, Telecom down by 0.45%, FMCG down by 0.36% and Consumer Durables down by 0.28% were the top losing indices on BSE.

The top gainers on the Sensex were SBI up by 2.44%, Maruti Suzuki up by 2.03%, Power Grid up by 1.86%, HDFC up by 1.70% and Larsen & Toubro up by 1.66%. On the flip side, Titan Co down by 1.59%, Ultratech Cement down by 1.17%, Indusind Bank down by 0.91%, Bajaj Finserv down by 0.83% and Hindustan Unilever down by 0.81% were the top losers.

Meanwhile, industry chamber -- the Confederation of Indian Industry (CII) has asked the Reserve Bank of India (RBI) to review its circular on appointment of auditors for banks and NBFCs and said it was inconsistent with the provisions of the Companies Act and would create hardship for businesses in times COVID.  The RBI in its circular on April 27, 2021 imposed various restrictions on appointment of auditors by banks and NBFCs and prescribed a cooling off period for re-appointment.

Urging the RBI to review the circular, the CII said the proposals ‘will cause significant hardship to the companies, its stakeholders as well as industry in general'. The chamber said that few matters that warrant an immediate attention of the RBI include a clarification that the circular is only intended to cover banks and NBFCs and their respective audit firms’. It said ‘The RBI may not apply the same principles to the commercial banks and NBFCs, including in respect of cap on maximum number of audits, mandatory joint audits, and rotation/cool off principles. The NBFCs may continue to be governed by the Companies Act, 2013’.

It also suggested to re-consider severe restrictions on capacity and eligibility requirements, limit on number of audits, maximum engagement period of 3 years and 6 years cool off period after rotation. It added ‘The RBI may consider aligning them with the provisions in the Companies Act, 2013. The RBI may still achieve its objectives, without diluting any of the principles’.

CII further asked for review of definition of related parties, which as per the circular include the group entities using a common brand name as this has far reaching implications and unintended consequences; and restrictions on audit/non-audit services during one year before/after the appointment as auditors of a bank/NBFC, covering the entity and its group entities. It noted that ‘These provisions may create severe capacity constraints, without adding any qualitative parameters’.

The CNX Nifty is currently trading at 15219.45, up by 44.15 points or 0.29% after trading in a range of 15145.45 and 15251.90. There were 28 stocks advancing against 22 stocks declining on the index.

The top gainers on Nifty were Indian Oil Corp up by 3.26%, Hero MotoCorp up by 2.41%, SBI up by 2.19%, BPCL up by 2.09% and Maruti Suzuki up by 1.97%. On the flip side, JSW Steel down by 3.18%, Shree Cement down by 2.70%, Tata Steel down by 2.54%, Titan Co down by 1.59% and Grasim Industries down by 1.46% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 82.51 points or 0.29% to 28,400.34, Taiwan Weighted strengthened 27.74 points or 0.17% to 16,329.80, Straits Times advanced 11.13 points or 0.36% to 3,129.02, Shanghai Composite gained 5.48 points or 0.16% to 3,492.04 and Jakarta Composite soared 4.04 points or 0.07% to 5,777.16. On the flip side, KOSPI fell 6.21 points or 0.2% to 3,150.21 and Hang Seng decreased 116.34 points or 0.41% to 28,342.10.