Bourses trade strength to strength in late afternoon session

Key benchmark indices are trading strength to strength since morning. Currently, markets traded at day’s high points. The broader indices, the BSE Mid cap index and Small cap index were also trading above a percent. Among heavy-weights Infosys, Indusind Bank and Tech Mahindra exhibited a smart performance. The overall market breadth was largely positive as 2305 shares were advancing and 1073 were declining, while 180 shares were unchanged on the BSE. Traders took support after private report stated that India’s real gross domestic product (GDP) growth for the financial year 2022-23 is expected to be above 7 percent despite global headwinds. Traders ignored report that country’s foreign exchange reserves declined by a massive $8.062 billion to $580.252 billion in the week ended July 8, 2022.

On the global front, Asian markets were trading mixed after U.S. stocks ended several days of sell-offs with a sharp rebound on Friday, helped by upbeat earnings news and strong economic data. European markets were trading higher ahead of this week's ECB meeting and the expected resumption of an important gas pipeline that is currently closed for maintenance.

The BSE Sensex is currently trading at 54,375.44, up by 614.66 points or 1.14% after trading in a range of 54034.97 and 54383.33. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 1.32%, while Small cap index was up by 1.38%.

The top gaining sectoral indices on the BSE were IT up by 2.86%, TECK up by 2.64%, Metal up by 2.63%, Capital Goods up by 2.06% and Basic Materials was up by 1.81%, while FMCG down by 0.22% were the only losing indices on BSE.

The top gainers on the Sensex were Infosys up by 3.82%, Indusind Bank up by 3.69%, Tech Mahindra up by 3.48%, Bajaj Finserv up by 3.00% and Kotak Mahindra Bank up by 2.93%. On the flip side, Dr. Reddy's Lab down by 1.49%, HDFC Bank down by 1.46%, Hindustan Unilever down by 1.31%, Maruti Suzuki down by 0.93% and HDFC down by 0.79% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) in its latest monthly bulletin ‘July 2022’ has showed that in a global landscape marred by fears of recession and war, the Indian economy shows resilience. The recent revival of the monsoon, the pick-up in manufacturing and services, stabilisation of inflation pressures and strong buffers in the form of adequate international reserves, sufficient foodgrain stocks and a well-capitalised financial system together brighten the outlook and strengthen the conditions for a sustainable high growth trajectory in the medium-term.

The article published in the RBI's monthly bulletin compared the impact of the two taper announcements (May 22, 2013, and November 3, 2021) by the US Federal Reserve (Fed) on Indian financial markets. The event study results indicate that the 2021 Taper (Taper 2) announcement was less severe as compared to Taper Tantrum of 2013 (Taper 1) in terms of its impact on Indian bond yields and spreads.

Besides, the monthly bulletin noted that the electronification of global foreign exchange (FX) trading with the emergence of multi-bank platforms has transformed the execution of trade and price discovery. Some of these changes can be seen even in the onshore Indian Rupee (INR) market, albeit in a limited way.

The CNX Nifty is currently trading at 16,242.60, up by 193.40 points or 1.21% after trading in a range of 16142.20 and 16238.80. There were 39 stocks advancing against 10 stocks declining on the index, while 1 stock remain unchanged. 

The top gainers on Nifty were Hindalco up by 4.28%, Infosys up by 3.80%, Indusind Bank up by 3.73%, Tech Mahindra up by 3.51% and Bajaj Finserv up by 3.01%. On the flip side, Britannia down by 2.11%, Dr. Reddy's Lab down by 1.66%, HDFC Bank down by 1.33%, Hindustan Unilever down by 1.25% and Maruti Suzuki down by 0.85% were the top losers.

Asian markets were trading mixed, Nikkei 225 surged 145.08 points or 0.54% to 26,788.47, Taiwan Weighted strengthened 112.10 points or 0.78% to 14,550.62, KOSPI rose 8.66 points or 0.37% to 2,330.98 and Straits Times was up by 5.65 points or 0.18% to 3,096.28. On the flip side, Jakarta Composite lost 38.19 points or 0.57% to 6,651.90, Shanghai Composite declined 53.68 points or 1.64% to 3,228.06 and Hang Seng was down by 453.49 points or 2.19% to 20,297.72.

European markets were trading higher, UK’s FTSE 100 increased 62.17 points or 0.88% to 7,101.98, France’s CAC increased 36.35 points or 0.61% to 5,951.76 and Germany’s DAX was up by 191.29 points or 1.53% to 12,710.95.