Post Session: Quick Review

Indian equity benchmarks staged splendid recovery on Tuesday as traders opted to buy beaten down but fundamentally strong stocks as investors judged the recent sharp fall in the market as unwarranted. Markets started the day on an optimistic note as traders took encouragement after Commerce Ministry official said Indian exports showed a turnaround after December last year and are still going strong. Some support also came as Prime Minister Narendra Modi assured India Inc that the government would focus on reducing the compliance burden while exhorting the top companies to make full use of the production-linked incentive (PLI) scheme.

Markets extended gains as additional optimism came with report that the Asian Development Bank (ADB) will provide $350 million loan to improve access to urban services in India by accelerating policy actions and reforms to enhance service delivery and promote performance-based central fiscal transfers to urban local bodies (ULBs). However, market participants booked half of their early profit in later part of the trade as some cautiousness came with report that Formal job creation in the country slowed down in October with 1.27 million new jobs added under the Employees’ Provident Fund Organisation. This is the lowest after July when 1.23 million subscribers were added. Net new additions under EPFO stood at 1.36 million in August and 1.54 million in September.

On the global front, European markets made a positive start with a jump in commodity stocks offsetting concerns about the Omicron coronavirus variant. All the Asian markets ended in green terrain as traders went for bargain hunting after a worldwide slump for financial markets spurred by worries about how badly the omicron variant, inflation and other forces will hit the world economy. Meanwhile, Chinese markets cheered Beijing's move to help troubled property firms, although surging cases of the Omicron coronavirus variant remain a worry for investors.

Back home, traders took note of report that the Organisation for Economic Co-operation and Development (OECD) released the model rules, paving the way for the roll out of the new global tax regime that will subject multinational corporations to a minimum tax of 15% from 2023. On the sectoral front, automotive industry remain in focused, as credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has showed the 28.4% sequential decline in the domestic auto sales volumes (excluding CVs) in November 2021. The overall production and sales volumes decreased 26% yoy and 32% yoy, respectively, in November 2021.

The BSE Sensex ended at 56,319.01, up by 497.00 points or 0.89% after trading in a range of 56,047.22 and 56,900.74. There were 23 stocks advancing against 7 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index surged 1.43%, while Small cap index was up by 1.29%. (Provisional)

The top gaining sectoral indices on the BSE were Metal up by 2.99%, Consumer Durables up by 2.17%, Basic Materials up by 2.14%, Telecom up by 1.72% and TECK was up by 1.68%, while there were no losers on the BSE sectoral front. (Provisional)

The top gainers on the Sensex were HCL Tech up by 4.30%, Wipro up by 3.77%, Tata Steel up by 3.27%, Tech Mahindra up by 3.20% and Titan Company up by 2.35%. On the flip side, Power Grid Corporation down by 1.81%, Axis Bank down by 1.16%, Bajaj Finance down by 0.66%, SBI down by 0.47% and Mahindra & Mahindra down by 0.33% were the top losers. (Provisional)

Meanwhile, in order to improve urban services in India, the Asian Development Bank (ADB) will provide $350 million loan. ADB will provide loan to improve access to urban services in India by accelerating policy actions and reforms to enhance service delivery and promote performance-based central fiscal transfers to urban local bodies (ULBs).  The ADB will provide knowledge and advisory support to the Ministry of Housing and Urban Affairs in programme implementation, including monitoring and evaluation. 

Further, it will also support urban local bodies particularly in select low-income states to implement policy reforms, prepare investment plans, and provide recommendations on cross-cutting issues like climate change, environmental and social safeguards assessment, and gender equality and social inclusion. Rajat Kumar Mishra, Additional Secretary in the finance ministry signed the loan agreement for the first sub-programme of $350 million under Sustainable Urban Development and Service Delivery Programme while Takeo Konishi, Country Director of ADB's India Resident Mission, signed for ADB. The first sub-programme will establish essential policies and guidelines for urban reforms at the national level followed by specific reform actions and programme proposals at the state and ULB-level under second sub-programme.

After signing the agreement, Mishra stated that the programme is aligned with the government national flagship programmes that promote cities as engines of economic growth by improving the quality of urban life through the creation of high-quality urban infrastructure, assured service provisions, and efficient governance. Besides, Takeo Konishi said the programme builds upon ADB’s long engagement with India in the urban sector with continued support to the central and state governments to undertake reforms to ensure universal and improved access to basic urban services such as water supply, sanitation, and affordable rental housing, especially for the poor most affected by the COVID-19 pandemic.

The CNX Nifty ended at 16,770.85, up by 156.65 points or 0.94% after trading in a range of 16,688.25 and 16,936.40. There were 39 stocks advancing against 11 stocks declining on the index. (Provisional)

The top gainers on Nifty were HCL Tech up by 3.89%, Wipro up by 3.73%, UPL up by 3.58%, Adani Ports up by 3.41% and Tata Steel up by 3.00%. On the flip side, Power Grid Corporation down by 1.55%, Axis Bank down by 1.26%, Bajaj Finance down by 0.85%, Cipla down by 0.79% and SBI down by 0.71% were the top losers. (Provisional)

All the European markets were trading in green; France’s CAC gained 32.09 points or 0.47% to 6,902.19, Germany’s DAX rose 95.13 points or 0.62% to 15,334.80 and UK’s FTSE 100 was up by 59.91 points or 0.83% to 7,257.94.

Asian markets settled mostly higher on Tuesday, after falling heavily in the previous session on concerns that the new coronavirus strain Omicron could derail the global economic recovery. Chinese and Hong Kong shares rose as real estate shares extended their rebound as investors cheered efforts by policymakers to prevent a contagion from financial woes at China Evergrande Group and several other heavily indebted developers. Seoul shares gained with bargain hunting after the key index's recent drop over Omicron tensions. Japanese shares rebounded by strong gains in tech heavyweights.