Barometer gauges maintain gains

Stock markets were trading in fine fettle in the afternoon session due to buying in Realty, Telecom and Consumer Discretionary sectors. A steady dip in COVID-19 cases, relaxation of pandemic-led curbs and a rise in daily vaccinations has boosted sentiment so far. Additional support also came as in reversal of a two-month selling trend, foreign portfolio investors (FPIs) in June turned out to be net buyers by investing Rs 13,269 crore in Indian markets. Traders seem to have overlooked report that India's services sector activities contracted further in June as the intensification of the COVID-19 crisis and reintroduction of containment measures restricted demand. The seasonally adjusted India Services Business Activity Index fell from 46.4 in May to 41.2 in June, as new work intakes and output contracted at the fastest rates since July 2020, which prompted companies to reduce employment again.

On the global front, Asian markets were trading mixed as the strong global economic rebound optimism spurred after US monthly job figures came out stronger than expected. Back home, market breadth remained optimistic, as there were 2194 shares on the gaining side against 1025 shares on the losing side, while 155 shares remained unchanged.

The BSE Sensex is currently trading at 52787.32, up by 302.65 points or 0.58% after trading in a range of 52604.35 and 52871.29. There were 25 stocks advancing against 5 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.22%, while Small cap index was up by 0.84%.

The top gaining sectoral indices on the BSE were Realty up by 2.07%, Telecom up by 1.12%, Consumer Discretionary up by 0.77%, Auto up by 0.67% and Basic Materials was up by 0.63%, while Power down by 0.27% and Oil & Gas was down by 0.00% were the only losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 1.59%, Bajaj Finserv up by 1.25%, Bajaj Finance up by 1.16%, HDFC Bank up by 1.10% and Power Grid was up by 0.94%. On the flip side, Tech Mahindra down by 0.80%, Titan Company down by 0.48%, Nestle down by 0.33%, HCL Tech down by 0.23% and Dr. Reddy's Lab was down by 0.16% were the top losers.

Meanwhile, ratings agency ICRA in its latest report has said that revenue growth of some of the leading drugs firms is estimated at 7-9 percent in FY2022 and 8-11 percent in FY2023, with gradual improvement in the COVID-19 situation in the country. It noted that the growth will be supported by the consistent demand for pharmaceutical products and low base of FY2021, though some impact on volume growth will be witnessed due to the second wave of COVID-19 2.0 related lockdowns.

According to the report, the credit outlook for the Indian pharmaceutical industry remains stable led by healthy accruals, low leverage levels and healthy liquidity profile of the pharmaceutical companies. It expects the credit metrics of its sample set of Indian pharmaceutical companies to remain comfortable despite higher capital expenditure and R&D expenses. Furthermore, it added that the liquidity profile of these companies is also expected to remain comfortable.

The ratings agency has noted that the impact of COVID-19 on the Indian drug firms was relatively limited last fiscal due to consistent demand for pharmaceutical products and resumption of imports of key input materials from China from March 2020 onwards. The revenue growth for ICRA sample of 21 companies remained muted at 5.8 per cent in FY2021.

The CNX Nifty is currently trading at 15807.35, up by 85.15 points or 0.54% after trading in a range of 15762.05 and 15833.20. There were 38 stocks advancing against 12 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 2.30%, Larsen & Toubro up by 1.58%, Eicher Motors up by 1.34%, Bajaj Finserv up by 1.28% and Bajaj Finance was up by 1.24%. On the flip side, BPCL down by 0.83%, Tech Mahindra down by 0.82%, HDFC Life Insurance down by 0.79%, Adani Ports down by 0.46% and Titan Company was down by 0.39% were the top losers.

Asian markets were trading mixed; KOSPI rose 11.43 points or 0.35% to 3,293.21, Taiwan Weighted strengthened 209.18 points or 1.18% to 17,919.33, Shanghai Composite gained 6.33 points or 0.18% to 3,525.09 and Straits Times was up by 4.58 points or 0.15% to 3,133.53.

On the flip side, Hang Seng decreased 163.29 points or 0.58% to 28,147.13, Jakarta Composite lost 26.14 points or 0.43% to 5,996.87 and Nikkei 225 was up by 185.09 points or 0.64% to 28,598.19.