Bulls hold tight grip over Dalal Street

Bulls were holding a tight grip over the Dalal Street in late morning session, with both Sensex and Nifty maintaining their strong gains. Positive cues from other Asian markets helped indices to maintain their gaining rally. Sentiments were positive, as Union Minister of Commerce and Industry Piyush Goyal said the venture capitalists have played a pivotal role in India's startup story and the economic growth of the country. Addressing the Indian Venture and Alternate Capital Association's (IVCA) Conclave, he said they have been driving innovation and bringing new ideas to the fore. Besides, Prime Minister Narendra Modi addressed 11 budget-related webinars over the last few weeks during which valuable suggestions were also received from stakeholders to aid the effective implementation of the budget announcements.

On the global front, Asian markets were trading in green, after Malaysia's unemployment rate remained stable in January, while the number of those without jobs decreased. The data from the Department of Statistics showed that the jobless rate remained unchanged at 4.2 percent in January. In the same month last year, the unemployment rate was 4.9 percent. The number of unemployed persons decreased to 680,400 in January from 687,600 in the previous month.

The BSE Sensex is currently trading at 55943.81, up by 1296.48 points or 2.37% after trading in a range of 55564.83 and 56242.47. There were 29 stocks advancing against 1 stock declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.91%, while Small cap index was up by 2.21%.

The top gaining sectoral indices on the BSE were Bankex up by 4.29%, Realty up by 3.55%, Auto up by 3.37%, Industrials up by 2.82% and Consumer discretionary up by 2.79%, while Metal down by 0.29% was the only losing index on BSE.

The top gainers on the Sensex were Indusind Bank up by 5.84%, Axis Bank up by 5.46%, Hindustan Unilever up by 5.36%, Bajaj Finserv up by 5.09% and SBI up by 4.67%. On the flip side, Tech Mahindra down by 0.86% was the only loser.

Meanwhile, India Ratings and Research (Ind-Ra) in its latest report has said 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).

Ind-Ra said although the Omicron-led COVID wave has subsided, the geopolitical risks to the global recovery have increased due to the Russia-Ukraine conflict. It said the direct effects of the Russia-Ukraine conflict have pushed commodity prices and freight and transportation costs higher; crude oil prices have been on a boil. In addition, the Indian rupee, which averaged at 75 against the dollar in February 2022, is expected to average around 76 this month which might result in a depreciation of 0.29 per cent in fourth quarter over the previous three-month period.

The agency further said that despite the adverse effects of the Russia-Ukraine conflict, the merchandise imports are likely to recover further due to the normalising domestic economy, higher commodity prices and depreciation of the rupee, pushing the merchandise imports bill to over $166 billion in Q4 FY22. The FY22 merchandise import bill is estimated at an all-time high of over $606 billion. However, the agency believes that merchandise exports might be constrained to $101.3 billion in Q4 FY22, taking it to $406 billion in FY22. As a result, the merchandise trade deficit is likely to come at $200 billion in FY22. All in all, CAD is expected at over $25 billion in Q4 FY22.

The CNX Nifty is currently trading at 16716.05, up by 370.70 points or 2.27% after trading in a range of 16593.05 and 16757.30. There were 44 stocks advancing against 6 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 6.34%, Indusind Bank up by 5.55%, Hindustan Unilever up by 5.45%, Axis Bank up by 5.30% and Bajaj Finserv up by 5.04%. On the flip side, Coal India down by 4.29%, Hindalco down by 1.71%, Tech Mahindra down by 0.98%, ONGC down by 0.88% and Power Grid down by 0.19% were the top losers.

Asian markets were 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.