Benchmarks extend gains in morning session

Indian equity markets extended their gains in morning session to trade near intraday high levels, tracking gains in broader Asian markets that rose as oil prices fell. Traders overlooked India Ratings and Research’s (Ind-Ra) report that the country's current account deficit (CAD) is likely to widen to a 13-quarter high of $23.6 billion or 2.8 per cent of GDP in October-December 2021-22 (Q3FY22) as against a deficit of $9.6 billion (1.3 per cent of GDP) in Q2 FY22, due to higher commodity prices following the Russia-Ukraine conflict. In Q3 FY21, the deficit was $2.2 billion (0.3 per cent of GDP). Traders took a note of Former Reserve Bank of India (RBI) governor Raghuram Rajan’s statement that India needs to recalibrate its response to the price situation following disruptions in global supply chains on account of Russia-Ukraine war, as losing the battle against inflation neither serves the government nor the central bank. Further, he said it is very important for any central bank to respect its mandate given to it by the government.

On the global front, Asian markets are trading in green following the broadly positive cues overnight from Wall Street, amid slightly easing worries about inflation following a drop in commodity prices. Back home, stocks related to diamond industry remained in watch as Crisil report warned that the crippling economic sanctions imposed by the US and European nations on Russia following its invasion of Ukraine threaten to take the sheen off the domestic diamond industry, culling its sales by 25-30 per cent worth $2-2.5 billion in the next quarter alone.

The BSE Sensex is currently trading at 56057.26, up by 1409.93 points or 2.58% after trading in a range of 55564.83 and 56242.47. There were 28 stocks advancing against 2 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 1.91%, while Small cap index was up by 2.37%.

The top gaining sectoral indices on the BSE were Bankex up by 4.62%, Realty up by 3.84%, Auto up by 3.54%, Industrials up by 2.98% and Consumer Discretionary up by 2.88%, while Metal down by 0.54% was the lone losing index on BSE.

The top gainers on the Sensex were Axis Bank up by 6.47%, Indusind Bank up by 5.25%, Bajaj Finserv up by 5.24%, SBI up by 5.12% and ICICI Bank up by 4.86%. On the flip side, Tech Mahindra down by 0.36% and HCL Technologies down by 0.01% were the top losers.

Meanwhile, Commerce and Industry Minister Piyush Goyal has urged investors to focus on entrepreneurs in small cities, foster innovation and facilitate mobilisation of domestic capital. Goyal said that there is a large pool of talent in India's interiors and venture capital funds should reach out to tier 3-4 towns and cities. He stated many entrepreneurs in India have their roots in small towns and rural India which started as a small unit.

He mentioned ‘I suggest a 4-pronged focus from the industry. Urge investors and capital providers to focus on 4 Fs - fostering innovation and future tech, facilitate mobilisation of domestic capital, fast tracking self reliance, and focus on tier 2,3,4 cities and towns.’ He added that domestic seed capital will have to increasingly play a big role. He suggested engaging with incubators being set up all across the country.

Besides, ‘If the domestic venture capital industry could literally adopt some of these incubators and reach out to remote areas, it will make a difference. Also, a collective effort to put money on the table and not squeeze them out of their ideas,’ he said, expressing concern that at a nascent stage, many good ideas get sold 'very cheap' and get taken over with a very small ticket check for lack of alternatives by one or the other investor

The CNX Nifty is currently trading at 16724.50, up by 379.15 points or 2.32% after trading in a range of 16593.05 and 16757.30. There were 45 stocks advancing against 5 stocks declining on the index.

The top gainers on Nifty were Axis Bank up by 6.42%, Tata Motors up by 6.41%, Bajaj Finserv up by 5.03%, Indusind Bank up by 4.96% and Grasim Industries up by 4.76%. On the flip side, Coal India down by 4.10%, Hindalco down by 1.81%, ONGC down by 1.34%, Tech Mahindra down by 0.65% and HCL Tech. down by 0.38% were the top losers.

Asian markets are trading in green; Hang Seng increased 260.59 points or 1.26% to 20,888.30, Nikkei 225 surged 977.40 points or 3.95% to 25,694.93, Taiwan Weighted strengthened 411.71 points or 2.42% to 17,427.07, KOSPI rose 47.33 points or 1.8% to 2,669.73, Shanghai Composite gained 62.16 points or 1.91% to 3,318.55, Straits Times advanced 42.74 points or 1.34% to 3,238.12 and Jakarta Composite soared 5.05 points or 0.07% to 6,869.49.