Markets trade firm in early deals following Asian peers

Indian equity benchmarks started the new month on optimistic note with gap-up opening tracking gains in Asian peers. Markets are trading firm in early deals with gains of over half a percent each on account of buying in Realty, Metal and Telecom counters. Investors are eyeing Manufacturing PMI for October due to be released later in the day. Traders took encouragement as the Reserve Bank of India (RBI) said that retail -- covering housing and vehicles, credit cards, etc -- showed an accelerated growth rate of 12.1 per cent in September 2021 against 8.4 per cent in September 2020. Besides, in a relief to small-size firms, the Reserve Bank of India (RBI) has relaxed rules for opening current accounts with the banking system’s exposure of less than Rs 5 crore. The RBI asked banks to take an undertaking from borrowers that they will inform lenders when the credit facilities availed reaches Rs 5 crore or more. Traders largely overlooked data showing that growth of eight core industries dropped to 4.4 per cent in September from 11.5 per cent in the previous month due to flat fertilizer production, decline in crude oil output and slowdown in expansion of electricity generation.

Most of the Asian markets traded higher following the positive cues from Wall Street on Friday, on higher crude oil prices and as traders reacted to the results of Japan's lower house election. Traders are also reluctant to make significant bets ahead of the Federal Reserve's monetary policy meeting this week. Back home, auto stocks were in limelight as they begin announcing their monthly sales figures for October today onwards. In scrip specific developments, Vedanta traded higher as it posted 5-fold YoY jump in consolidated net profit at Rs 4,615 crore for the July-September quarter, as against Rs 838 crore on a low-base effect. However, Bandhan Bank traded under pressure as it reported a loss of Rs 3,008.6 crore in Q2FY22 on huge provisions of over Rs 4,600 crore for the bad loans and restructured advances.

The BSE Sensex is currently trading at 59713.48, up by 406.55 points or 0.69% after trading in a range of 59419.42 and 59830.31. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.45%, while Small cap index was up by 0.83%.

The top gaining sectoral indices on the BSE were Realty up by 2.51%, Metal up by 2.38%, Telecom up by 2.15%, TECK up by 1.55%, IT up by 1.46%, while Energy down by 0.30%, Auto down by 0.24%, FMCG down by 0.16%, Utilities down by 0.05%, Healthcare down by 0.05% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 3.28%, Bharti Airtel up by 2.40%, HCL Technologies up by 2.17%, Indusind Bank up by 1.96% and HDFC up by 1.80%. On the flip side, Bajaj Finserv down by 1.99%, Nestle down by 1.12%, Mahindra & Mahindra down by 1.11%, Hindustan Unilever down by 0.58% and Reliance Industries down by 0.53% were the top losers.

Meanwhile, the Controller General of Accounts (CGA) in its latest data showed that the union government’s fiscal deficit has worked out to be Rs 5.26 lakh crore or 35 per cent of the budget estimates at the end of September 2021. The deficit figures in the current fiscal appear much better than the previous financial year when it had soared to 114.8 per cent of the estimates mainly on account of a jump in expenditure to deal with the COVID-19 pandemic.

The CGA said in absolute terms, the fiscal deficit or gap between expenditure and revenue was Rs 5,26,851 crore at end of September. For the current financial year, the government expects the deficit at 6.8 per cent of GDP or Rs 15,06,812 crore. As per the data, the central government’s total receipts stood at Rs 10.99 lakh crore or 55.6 per cent of corresponding budget estimates (BE) 2021-22 up to September, 2021. The total receipts were 25.2 per cent of the BE of 2020-21 during the corresponding period of last financial year.

Of the total receipts, the tax revenue was Rs 9.2 lakh crore or 59.6 per cent of BE. The tax revenue was only 28 per cent of BE of 2020-21 in the year ago period. The CGA data further said central government’s total expenditure at the end of the first half of the fiscal year stood at Rs 16.26 lakh crore or 46.7 per cent of current fiscal’s BE.

Of the total expenditure, out of Rs 13,96,666 crore was on revenue account and Rs 2,29,351 crore was on capital account. Out of the total revenue expenditure, Rs 3,63,757 crore was on account of interest payments and Rs 1,80,959 crore is on account of major subsidies. The fiscal deficit for 2020-21 was 9.3 per cent of the gross domestic product (GDP), better than 9.5 per cent projected in the revised estimates in the budget in February.

The CNX Nifty is currently trading at 17765.50, up by 93.85 points or 0.53% after trading in a range of 17697.10 and 17833.60. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 3.42%, Hindalco up by 3.04%, Indusind Bank up by 2.21%, Bharti Airtel up by 2.19% and JSW Steel up by 2.06%. On the flip side, UPL down by 4.80%, Bajaj Finserv down by 2.45%, Tata Motors down by 1.64%, Mahindra & Mahindra down by 1.13% and Nestle down by 1.08% were the top losers.

Asian markets are trading mostly in green; Nikkei 225 surged 689.36 points or 2.39% to 29,582.05, Straits Times jumped 25.86 points or 0.81% to 3,224.03, Taiwan Weighted rose 84.24 points or 0.50% to 17,071.65, KOSPI added 13.39 points or 0.45% to 2,984.07, Jakarta Composite advanced 12.40 points or 0.19% to 6,603.75 and Shanghai Composite was up by 2.59 points or 0.07% to 3,549.93, while Hang Seng fell 286.92 points or 1.13% to 25,090.32.