Markets trade higher in early deals; Healthcare, Telecom lead

Indian equity benchmarks made slightly positive start on Friday amid mixed cues from Asian peers. Markets are trading higher with marginal gains in early deals on account of buying in Healthcare, Telecom and Metal stocks. Traders took encouragement with the Reserve Bank of India’s (RBI) report that the tapering of the second wave, coupled with an aggressive vaccination push, has brightened near-term prospects for the Indian economy, and the Indian economy may have grown 22.1 per cent in the April-June quarter. Adding optimism, the data released by the Commerce Ministry showed that the country's exports rose by 48.34 per cent to $32.5 billion on account of healthy growth in shipments of petroleum products, gems and jewellery, and chemicals, leather and marine goods. However, upside remained capped as India recorded a spike of 39,072 fresh Covid-19 cases in the last 24 hours, taking the total caseload to 31,025,875, according to Worldometer. The death count increased to 412,563 with 544 new fatalities, the data showed.

Asian markets were trading mixed, following the negative cues overnight from Wall Street on sinking crude oil prices, renewed Covid-19 concerns and rising tensions between China and the US. Traders are also worried about the global economy as some central banks around the world are considering tightening monetary policy much sooner than the US Federal Reserve. Back home, banking stocks were in focus as RBI data showed that bank credit grew by 6 per cent to Rs 109.31 lakh crore and deposits increased by 9.76 per cent to Rs 154.51 lakh crore in the fortnight ended July 2. In scrip specific development, L&T Infotech came under pressure after its Q1FY22 net profit fell 9 percent to Rs 496.8 crore from Rs 545.7 crore, while revenue rose 5.9 percent to Rs 3,462.5 crore from Rs 3,269.4 crore, QoQ.

The BSE Sensex is currently trading at 53275.44, up by 116.59 points or 0.22% after trading in a range of 53165.06 and 53290.81. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.23%, while Small cap index was up by 0.51%.

The top gaining sectoral indices on the BSE were Healthcare up by 1.31%, Telecom up by 1.11%, Metal up by 0.63%, FMCG up by 0.52%, Energy up by 0.50%, while Realty down by 0.23%, IT down by 0.20%, TECK down by 0.11%, Oil & Gas down by 0.09%, Power down by 0.08% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 1.64%, ITC up by 1.45%, Bharti Airtel up by 1.09%, Reliance Industries up by 0.72% and Asian Paints up by 0.69%. On the flip side, HCL Technologies down by 1.16%, Tech Mahindra down by 1.08%, ICICI Bank down by 0.50%, NTPC down by 0.46% and Indusind Bank down by 0.37% were the top losers.

Meanwhile, the Reserve Bank of India’s (RBI) latest article said the tapering of the second wave of the COVID-19 pandemic coupled with aggressive vaccination has brightened the near-term prospects of the Indian economy, though a solid increase in aggregate demand may take some time.

Attributing the rise in inflation to the supply side disruptions on account of the pandemic and hardening of commodity prices in the international market, the RBI article opined that these factors should ease over the year as supply-side measures take effect. It said the pick-up in inflation is driven largely by adverse supply shocks due to disruptions caused by the pandemic, including increases in margins and taxes.

Furthermore, it said ‘a solid increase in aggregate demand is yet to take shape. Even with a 9.5 per cent GDP growth in 2020-21, there will be substantial slack in the economy and demand pressures may take some more time to become evident.’

The CNX Nifty is currently trading at 15953.70, up by 29.50 points or 0.19% after trading in a range of 15930.00 and 15962.25. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Divi's Lab up by 2.78%, Sun Pharma up by 1.76%, Cipla up by 1.53%, ITC up by 1.28% and Bharti Airtel up by 1.13%. On the flip side, Eicher Motors down by 1.71%, HCL Technologies down by 1.15%, Tech Mahindra down by 1.05%, ONGC down by 0.86% and ICICI Bank down by 0.58% were the top losers.

Asian markets were trading mixed; Nikkei 225 declined 249.20 points or 0.88% to 28,029.89, Taiwan Weighted slipped 134.75 points or 0.75% to 17,899.44, KOSPI lost 18.95 points or 0.58% to 3,267.27 and Shanghai Composite was down by 0.80 points or 0.02% to 3,563.79. On the other hand, Straits Times rose 4.41 points or 0.14% to 3,144.39, Hang Seng added 104.96 points or 0.37% to 28,101.23 and Jakarta Composite gained 10.49 points or 0.17% to 6,057.24.