Markets trim most of gains in late afternoon session

Local equity benchmarks trimmed most of their gains in late afternoon session but managed to remain in green territory. Traders took support as finance Minister Nirmala Sitharaman has exhorted ministries to aim to achieve more than their capital expenditure (capex) targets for this fiscal (FY22), highlighting that enhanced spending will play a critical role in revitalising the economy post-COVID pandemic. She also urged the ministries and their Central Public Sector Enterprises (CPSEs) to ensure clearance of Micro, Small and Medium Enterprises (MSME) dues by July 31. However, upside remain capped, as Reserve Bank of India (RBI) in its latest data has showed that credit growth to the industrial sector remained in the negative territory during 2020-21, mainly due to the COVID-19 pandemic and resultant lockdowns.

On the global front, Asian markets were trading mostly in green as investors were buoyed by optimism over a strong economic recovery despite fears over rising virus cases around the world. European markets were trading lower, as worries about rising inflation and the Delta variant of the novel coronavirus hit economically sensitive sectors, even as technology stocks tracked an overnight surge in their U.S. peers.

The BSE Sensex is currently trading at 52,600.94, up by 51.28 points or 0.10% after trading in a range of 52630.91 and 52875.92. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.31%, while Small cap index was up by 0.77%.

The top gaining sectoral indices on the BSE were IT up by 1.12%, Metal up by 1.01%, TECK up by 0.97%, Industrials up by 0.90% and Energy was up by 0.74%, while Utilities down by 0.60%, Power down by 0.59%, Realty down by 0.38% and FMCG was down by 0.23% were the few losing indices on BSE.

The top gainers on the Sensex were Infosys up by 1.43%, Reliance Industries up by 1.32%, Kotak Mahindra Bank up by 1.17%, Bharti Airtel up by 0.88% and Maruti Suzuki up by 0.83%. On the flip side, ICICI Bank down by 0.88%, Power Grid down by 0.83%, Hindustan Unilever down by 0.65%, HDFC down by 0.62% and Bajaj Finserv down by 0.51% were the top losers.

Meanwhile, Finance Minister Nirmala Sitharaman has exhorted ministries to aim to achieve more than their capital expenditure (capex) targets for this fiscal (FY22), highlighting that enhanced spending will play a critical role in revitalising the economy post-COVID pandemic. She also urged the ministries and their Central Public Sector Enterprises (CPSEs) to ensure clearance of Micro, Small and Medium Enterprises (MSME) dues by July 31.

Sitharaman further urged the ministries to explore Public Private Partnership (PPP) mode for viable projects. While reviewing the capital expenditure performance of the ministries and their CPSEs, she emphasised that enhanced CAPEX will play a critical role in revitalising the economy post-pandemic and encouraged the ministries to front-load their capital expenditure. Union Budget for 2021-22 has provided a capital outlay of Rs 5.54 lakh crore, an increase of 34.5 percent over the Budget Estimate of 2020-21. However, she said the efforts from the budgetary side to increase the capital expenditure have to be complemented by the public sector enterprises.

The minister further said infrastructure expenditure is not just the central government budgetary expenditure on infrastructure but also includes infrastructure spending by state governments and private sector. It also includes government expenditure through extra-budgetary resources. Therefore, she said, ministries are to actively work on getting projects funded through innovative structuring and financing and provide all support to private sector for enhancing infrastructure spending.

The CNX Nifty is currently trading at 15,766.75, up by 18.30 points or 0.12% after trading in a range of 15769.40 and 15839.10. There were 32 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Coal India up by 1.83%, Divi's Lab up by 1.66%, Infosys up by 1.30%, Reliance Industries up by 1.23% and Kotak Mahindra Bank up by 1.01%. On the flip side, Shree Cement down by 1.27%, Power Grid down by 1.00%, Tata Consumer down by 0.90%, ICICI Bank down by 0.89% and Eicher Motors down by 0.72% were the top losers.

Asian markets were trading mostly in green, Taiwan Weighted strengthened 157.27 points or 0.89% to 17,755.46, Straits Times advanced 46.18 points or 1.49% to 3,135.67, Jakarta Composite soared 36.44 points or 0.61% to 5,985.49, Shanghai Composite gained 18.02 points or 0.5% to 3,591.20 and KOSPI was up by 10.00 points or 0.3% to 3,296.68. On the flip side, Nikkei 225 slipped 21.08 points or 0.07% to 28,791.53 and Hang Seng was down by 166.15 points or 0.57% to 28,827.95.

European markets were trading lower, UK’s FTSE 100 decreased 46.24 points or 0.65% to 7,041.31, France’s CAC decreased 63.10 points or 0.96% to 6,504.33 and Germany’s DAX was down by 138.44 points or 0.88% to 15,552.15.