Markets trade tad higher in early deals

Indian equity benchmarks made slightly negative start on Thursday tracking weakness in Asian peers coupled with rising corona cases. India recorded a dramatic surge in Omicron cases. Soon, markets recovered and entered into green territory. Now, domestic indices are trading higher with marginal gains in early deals on account of buying in IT, TECK and Telecom stocks. Sentiments got a boost as the Federation of Indian Export Organisations (FIEO) said the country's exports are expected to register healthy growth rate in the financial year 2022-23 and might touch $530 billion as exporters are flushed with orders. It added that additional exports will come from some of the PLI (production-linked incentive) sectors in the next fiscal. Traders took note of the I-T department’s statement that over 5 crore income tax returns (ITR) for the financial year ended March 2021 have been filed so far.

On the global front, most of the Asian markets are trading lower following the mixed cues overnight from Wall Street, as investors delve over the potential impact of the fast spreading Omicron Coronavirus variant. They also seem reluctant to continue making significant moves as the virus spreads rapidly across more countries, with some implementing lockdowns and strict restrictions.

Back home, the government has extended till February 28 the deadline for businesses to file GST annual returns for 2020-21 fiscal ended March 2021. On the sectoral front, the telecom services sector stocks were in focus as ICRA revised outlook on telecom services sector to stable from negative and said the telecom tariff hike along with the recent relief package offers sufficient headroom for the industry to undertake deleveraging as well as fund capex for 5G tech upgrade. In scrip specific development, IRB Infrastructure Developers gained as it successfully raised Rs 5,347 crore through preferential placement of equity shares from Cintra INR Investments BV and Bricklayers Investments.

The BSE Sensex is currently trading at 57852.09, up by 45.60 points or 0.08% after trading in a range of 57578.99 and 57856.10. There were 14 stocks advancing against 15 stocks declining, while 1 stock remain unchanged on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.08%, while Small cap index was up by 0.33%.

The top gaining sectoral indices on the BSE were IT up by 0.63%, TECK up by 0.62%, Telecom up by 0.58%, Healthcare up by 0.27%, Consumer Durables up by 0.11%, while Oil & Gas down by 0.67%, Realty down by 0.65%, PSU down by 0.34%, Energy down by 0.30%, Utilities down by 0.26% were the top losing indices on BSE.

The top gainers on the Sensex were Wipro up by 1.34%, Tech Mahindra up by 0.86%, HCL Technologies up by 0.81%, Power Grid up by 0.78% and Dr. Reddy's Lab up by 0.65%. On the flip side, Bajaj Finserv down by 1.51%, Larsen & Toubro down by 0.43%, Sun Pharma down by 0.38%, Bajaj Finance down by 0.31% and SBI down by 0.29% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) in its second Financial Stability Report (FSR) has stated that the Omicron variant of coronavirus remains the major challenge along with rising inflation pressures, though the economy has steadily gained momentum and remained resilient since the second quarter of the current fiscal. RBI Governor Shaktikanta Das noted that after the destructive second wave in April-May 2021, the growth outlook has progressively improved, though there are headwinds from global developments and more recently from the Omicron virus.

He added that a stronger and sustainable recovery hinges on the revival of private investment and shoring up private consumption, which unfortunately still remain below their pre-pandemic levels. Admitting that inflation remains a concern as it is by the build-up of cost-push pressures, Das has called for stronger supply-side measures to contain food and energy prices. Noting that the financial institutions have remained resilient amidst the pandemic and stability prevails in the financial markets cushioned by policy and regulatory support, the governor is confident that the strong balance sheets of banks with higher capital and liquidity buffers will help mitigate future shocks.

Citing the stress tests on banks, the governor has also warned that gross NPAs may jump to 8.1-9.5 per cent by September 2022 from 6.9 per cent in September 2021. The bank noted that the scheduled commercial banks would, however, have sufficient capital, both at the aggregate and individual levels, even under stress conditions. The governor concluded by reiterating the Reserve Bank's resolute commitment to ensure a robust and efficient financial system that supports strong, sustainable and inclusive growth with macroeconomic and financial stability.

The CNX Nifty is currently trading at 17218.25, up by 4.65 points or 0.03% after trading in a range of 17146.35 and 17222.90. There were 20 stocks advancing against 30 stocks declining on the index.

The top gainers on Nifty were Wipro up by 1.18%, HCL Technologies up by 1.01%, Tech Mahindra up by 0.90%, Tata Consumer Products up by 0.74% and Eicher Motors up by 0.61%. On the flip side, Bajaj Auto down by 1.72%, Bajaj Finserv down by 1.41%, BPCL down by 0.63%, IOC down by 0.58% and Larsen & Toubro down by 0.58% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 slipped 103.45 points or 0.36% to 28,803.43, Straits Times declined 9.34 points or 0.30% to 3,128.68, Taiwan Weighted fell 10.40 points or 0.06% to 18,237.88, KOSPI lost 13.67 points or 0.46% to 2,979.62 and Jakarta Composite was down by 4.97 points or 0.08% to 6,595.71. On the other hand, Hang Seng rose 22.13 points or 0.10% to 23,108.67 and Shanghai Composite was up by 29.58 points or 0.82% to 3,626.58.