Benchmarks trade higher in early deals; Metal stocks shine

Indian equity benchmarks made optimistic start on Wednesday tracking gains in global peers. Markets are trading higher with notable gains in early deals on account of buying in Metal, Auto and IT counters. Sentiments got a boost with Chief Economic Adviser (CEA) K V Subramanian’s statement that a number of reforms undertaken by the government in the last one year especially focused on removing supply side frictions are expected to spur investment, including foreign investment. Meanwhile, a day after witnessing a sharp decline in the number of daily Covid-19 cases, India recorded 45,699 infections and 816 fatalities in the last 24 hours. The country's total coronavirus caseload stands at 30,316,000, while the death toll has jumped to 397,668.

On the global front, most of the Asian markets were trading higher following the broadly positive cues overnight from Wall Street as the Nasdaq and the S&P 500 hit fresh closing highs. However, concerns about the spread of the highly contagious Covid-19 delta variant in Europe and Asia, and the resultant lockdowns and fresh restrictions on travel in several countries are weighing on market sentiment.

Back home, pharma stocks were in focus as sector majors including Cipla, Dr Reddy’s Laboratories, Sun Pharmaceutical Industries and Torrent Pharmaceuticals will collaborate for the clinical trial of the investigational oral anti-viral drug Molnupiravir for the treatment of mild COVID-19 in an outpatient setting in India. In scrip specific development, Bharti Airtel traded higher amid report that it will invest an additional $500 million (over Rs 3,700 crore) into One-Web, to become the largest shareholder in the satellite communications company.

The BSE Sensex is currently trading at 52665.99, up by 116.33 points or 0.22% after trading in a range of 52630.91 and 52764.28. There were 20 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.17%, while Small cap index was up by 0.58%.

The top gaining sectoral indices on the BSE were Metal up by 1.02%, Auto up by 0.73%, IT up by 0.71%, Industrials up by 0.69%, TECK up by 0.62%, while Utilities down by 0.91%, Power down by 0.88%, Realty down by 0.41%, Oil & Gas down by 0.27%, Bankex down by 0.14% were the top losing indices on BSE.

The top gainers on the Sensex were Maruti Suzuki up by 1.61%, Tata Steel up by 0.98%, Asian Paints up by 0.88%, Infosys up by 0.82% and Bajaj Auto up by 0.74%. On the flip side, Power Grid down by 0.78%, ICICI Bank down by 0.66%, NTPC down by 0.47%, Hindustan Unilever down by 0.32% and Indusind Bank down by 0.26% were the top losers.

Meanwhile, Oil minister Dharmendra Pradhan has said India's fuel demand, hit by a deadly second wave of coronavirus, would recover to pre-pandemic levels by the end of this year. Local fuel consumption - a proxy for oil demand - in May slumped to its lowest since last August as lockdowns and restriction in several states stalled mobility and muted economic activity.

The minister said Indian fuel demand showed signs of resurgence this month due to the lifting of lockdowns by states and a gradual pick-up in economic momentum. India, the world's third-biggest oil importer and consumer, imports over 80% of its oil needs. Asia's third-largest economy has been hit hard by a spike in global oil prices, with its tax-heavy retail prices of gasoline and gasoil touching record highs.

He said ‘Inflation is a challenge to the globe today ...so we are also facing this challenge in our economy. But with all these challenges we are confident by the end of this calendar year we will be in a position to restore our original consumption behaviour.’

The CNX Nifty is currently trading at 15781.25, up by 32.80 points or 0.21% after trading in a range of 15774.25 and 15812.55. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Maruti Suzuki up by 1.56%, JSW Steel up by 1.22%, IOC up by 1.02%, ONGC up by 0.92% and Tata Steel up by 0.87%. On the flip side, Power Grid down by 0.89%, ICICI Bank down by 0.73%, Indusind Bank down by 0.50%, Shree Cement down by 0.47% and Grasim Industries down by 0.41% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 added 10.95 points or 0.04% to 28,823.56, Straits Times surged 41.64 points or 1.35% to 3,131.13, Taiwan Weighted jumped 184.48 points or 1.05% to 17,782.67, KOSPI rose 13.73 points or 0.42% to 3,300.41, Jakarta Composite gained 33.30 points or 0.56% to 5,982.35 and Shanghai Composite was up by 8.54 points or 0.24% to 3,581.72, while Hang Seng fell 43.63 points or 0.15% to 28,950.47.