Domestic markets trade in fine-fettle in early deals ahead of IIP data

Indian equity benchmarks made positive start on Friday tracking gains in global peers. Markets are trading in fine-fettle with gains of over half a percent each in early deals on account of buying in Energy, Metal and Oil & Gas counters. A fall in the number of Covid cases in the country supporting the sentiment on D-Street. Fresh daily cases remained below the 1 lakh mark for the fourth day straight as India reported 91,000 cases in the last 24 hours. The steady decline in cases is igniting hopes of the further reopening of the economy, providing support to market mood. Traders took encouragement with Commerce Secretary Anup Wadhawan’s statement that India's export of agricultural and allied products in 2020-21 grew by 17.34 per cent to $41.25 billion, and this growth momentum is expected to be sustained in the current fiscal as well. Adding some optimism, credit rating agency Icra Ratings’ report stated that with decline in number of fresh COVID-19 cases and easing of restrictions, the country's gross domestic product (GDP) will grow at 8.5 per cent in FY2021-22. Investors are eyeing Index of Industrial Production (IIP) data to be out later in the day.

On the global front, most of the Asian markets were trading higher extending the gains of the previous session, following the positive cues overnight from Wall Street. Investors are also cautiously optimistic after reports of encouraging inflation data and slight drop jobless claims from the US. Back home, power stocks were in focus with report that India’s struggling wind power industry is looking to its clean energy rival for help emerging from a pandemic-induced slump. In scrip specific developments, GOCL Corporation gained as the company and its wholly owned subsidiary, IDL Explosives, have bagged orders of Rs 286.63 crore from Coal India. SAIL traded in green on reporting a 26.4 per cent YoY growth in net profit at Rs 3,444 crore for the March quarter of FY21 (Q4FY21).

The BSE Sensex is currently trading at 52587.13, up by 286.66 points or 0.55% after trading in a range of 52472.90 and 52626.64. There were 26 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.40%, while Small cap index was up by 0.66%.

The top gaining sectoral indices on the BSE were Energy up by 1.53%, Metal up by 1.48%, Oil & Gas up by 1.21%, PSU up by 0.96%, Utilities up by 0.86%, while Realty down by 0.15%, Consumer Durables down by 0.14% were only the losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 2.11%, Reliance Industries up by 1.65%, ONGC up by 1.41%, HDFC Bank up by 0.87% and HCL Technologies up by 0.87%. On the flip side, Bajaj Finserv down by 0.97%, Bajaj Finance down by 0.39%, Titan Company down by 0.34% and Hindustan Unilever down by 0.25% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) has said that it would be buying bonds maturing between 2026 and 2035 in its third tranche of the G-sec Acquisition Programme (G-SAP). The total size of the G-SAP programme would be Rs 40,000 crore, including Rs 10,000 crore of state development loans.  The RBI will be buying bonds of 20 states in the G-SAP, which will be held on June 17.

Out of its Rs 1 trillion reserved for this quarter, the RBI has already bought Rs 60,000 crore of bonds through two auctions. In G-SAP, the RBI commits to buy bonds and does not cancel the auction as such, but it has no security wise limit, and therefore it can buy the lowest offered bids for bonds.

The RBI will be buying six securities, but unlike last auction, it will not buy the benchmark 10 year bond. The liquidity for this particular paper is low now in the market as most of it has been bought by the RBI already under its various bond buying programmes.

The CNX Nifty is currently trading at 15825.00, up by 87.25 points or 0.55% after trading in a range of 15781.45 and 15835.55. There were 41 stocks advancing against 9 stocks declining on the index.

The top gainers on Nifty were Coal India up by 4.12%, Power Grid up by 2.05%, Reliance Industries up by 1.59%, ONGC up by 1.41% and JSW Steel up by 1.32%. On the flip side, Bajaj Finserv down by 0.95%, Titan Company down by 0.38%, Bajaj Finance down by 0.35%, Wipro down by 0.32% and HDFC Life Insurance down by 0.20% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 rose 5.21 points or 0.02% to 28,963.77, Straits Times added 1.39 points or 0.04% to 3,163.89, Hang Seng surged 106.58 points or 0.37% to 28,845.46, Taiwan Weighted increased 62.54 points or 0.36% to 17,221.76 and KOSPI jumped 17.22 points or 0.53% to 3,241.86. However, Jakarta Composite fell 7.24 points or 0.12% to 6,100.30 and Shanghai Composite was down by 9.04 points or 0.25% to 3,601.82.