Key gauges remain in green in morning deals

Indian equity benchmarks continued to trade in green in morning deals, as investors cheered positive inflation and industrial output data. Retail inflation eased to a three-month low of 5.59 per cent in July, mainly due to softening food prices, after holding above 6% for two months in a row. The Consumer Price Index (CPI) based inflation was 6.26 per cent in June and 6.73 per cent in July 2020. Besides, Industrial production surged by 13.6 per cent in June mainly due to a low-base effect and good performance by manufacturing, mining and power sectors but the output remained below the pre-pandemic level. In June 2021, the IIP stood at 122.6 points compared to 107.9 point in the same month last year. Some optimism also came with Finance Minister Nirmala Sitharaman’s statement that the government is an active participant in the recovery process and remains committed to reforms as is evident from a series of tangible steps taken including the passing of seven critical bills related to finance and corporate affairs in the monsoon session of parliament, commitment towards disinvestment and privatization and using technology to improve tax buoyancy.

On the global front, Asian markets were trading mostly in red as the spread of the delta variant of the coronavirus continues to stifle economic activity in most cities in the country.  Back home, on the sectoral front, Auto industry’s stocks remained in watch as Society of Indian Automobile Manufacturers (SIAM) has said Passenger vehicle wholesales in India increased by 45 per cent to 2,64,442 units in July against 1,82,779 units in the same month last year.

The BSE Sensex is currently trading at 55093.24, up by 249.26 points or 0.45% after trading in a range of 54905.49 and 55136.10. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.31%, while Small cap index was up by 0.54%.

The top gaining sectoral indices on the BSE were Capital Goods up by 1.09%, Metal up by 0.91%, IT up by 0.80%, Basic Materials up by 0.80% and FMCG up by 0.75%, while Healthcare down by 0.34%, Telecom down by 0.31% and Realty down by 0.08% were the top losing indices on BSE.

The top gainers on the Sensex were Bajaj Auto up by 1.57%, TCS up by 1.20%, ITC up by 1.10%, Larsen & Toubro up by 1.08% and HDFC up by 0.90%. On the flip side, Dr. Reddy's Lab down by 0.74%, Bharti Airtel down by 0.67%, Kotak Mahindra Bank down by 0.66%, Bajaj Finance down by 0.50% and Bajaj Finserv down by 0.45% were the top losers.

Meanwhile, Expressing the government's commitment to continue with reforms, Finance Minister Nirmala Sitharaman has assured India Inc that the government is committed in doing everything that it requires to be done for the economic growth hit by the COVID-19 pandemic. Stressing that there is a need to promote growth as it helps bring down poverty, she however said it would not be at the cost of inflation. RBI has been mandated to keep inflation at 4 per cent, with tolerance level of 2 per cent on either side.

The minister said ‘growth will be given its importance. Growth will be pushed both by the Reserve Bank and by us. We also want to assure the industry that inflation in the last 7 years has not crossed 6 per cent except seasonal variation. Inflation has been well within that band which is before us.’ Pointing out that she is not looking at growth versus inflation, Sitharaman said ‘we should attend to inflation, keep it contained, take all the necessary steps, but never forget that growth is what is going to make the difference to the economy's revival and growth is what is eventually going to remove poverty and bring in a certain level playing field for all the Indian citizens.’ She further said the government is looking at being an active participant in the economic recovery.

Observing that some high frequency indicators are pointing towards economic revival after unlock measures announced by many states with decline in COVID-19 cases, she said foreign direct investment (FDI) has been flowing into India non-stop despite the pandemic because there was confidence about the macroeconomic fundamentals.

The CNX Nifty is currently trading at 16439.65, up by 75.25 points or 0.46% after trading in a range of 16376.30 and 16449.95. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Tata Consumer Product up by 2.53%, Hindalco up by 2.18%, Bajaj Auto up by 1.48%, BPCL up by 1.34% and Grasim Industries up by 1.24%. On the flip side, Eicher Motors down by 2.94%, Dr. Reddy's Lab down by 0.77%, Kotak Mahindra Bank down by 0.73%, Bajaj Finance down by 0.56% and Bharti Airtel down by 0.46% were the top losers.

Asian markets were trading mostly in red; Taiwan Weighted dropped 190.79 points or 1.11% to 17,029.15, Hang Seng decreased 185.93 points or 0.7% to 26,331.89, KOSPI fell 44.06 points or 1.37% to 3,164.32, Straits Times trembled 23.03 points or 0.72% to 3,159.77, Shanghai Composite declined 8.98 points or 0.25% to 3,515.76 and Jakarta Composite lost 5.82 points or 0.09% to 6,133.83.

On the flip side, Nikkei 225 surged 20.47 points or 0.07% to 28,035.49.