Markets trade in fine-fettle in early deals; Sensex rises over 700 points

Indian equity benchmarks made gap-up opening on Tuesday tracking firm global cues. Markets are trading in fine-fettle in early deals with gains of over a percent each on account of buying in all the sector indices led by Auto, Capital Goods and Consumer Durables. Sensex and Nifty are trading above their crucial levels of 59,800 and 17,800, respectively. Foreign fund inflows also aided the domestic sentiments. Foreign institutional investors (FIIs) have net bought shares worth Rs 312.31 crore on September 19, as per provisional data available on the NSE. Some support came in with a private survey report indicating that Indian consumers are concerned about rising costs but 71 per cent of them believe the economy will recover within a year. Market participants overlooked report that surplus liquidity in the banking system as measured by absorption of excess funds by the Reserve Bank of India (RBI) fell sharply at the end of the last week due to outflows on account of advance tax payments.

Global cues remained supportive with all Asian markets trading higher following broadly positive cues from Wall Street overnight, with traders remaining cautiously optimistic as they believe the heavy selling in recent sessions has been overdone. Investors await the US Fed's monetary policy decision on Wednesday. The Fed is widely expected to raise interest rates by another 75 basis points, although some see an outside chance for a 100 basis point rate hike.

Back home, sugar industry stocks were in focus as Food Secretary Sudhanshu Pandey said the government will soon announce export quota of sugar for next marketing year starting October. In stock specific developments, shares of Mcleod Russel soared as Carbon Resources intends to take over the company. Also, Ircon International surged after the company bagged Rs 256 crore work order from Mahanadi Coalfields.

The BSE Sensex is currently trading at 59854.40, up by 713.17 points or 1.21% after trading in a range of 59556.91 and 59878.68. All the 30 stocks were advancing on the index.

The broader indices were trading in green; the BSE Mid cap index jumped 1.34%, while Small cap index was up by 1.18%.

The top gaining sectoral indices on the BSE were Auto up by 1.86%, Capital Goods up by 1.83%, Consumer Durables up by 1.80%, Metal up by 1.75%, Industrials up by 1.69%, while there was no loser on the BSE sectoral front.

The top gainers on the Sensex were Indusind Bank up by 3.14%, Larsen & Toubro up by 2.31%, ICICI Bank up by 2.11%, Bajaj Finserv up by 2.09% and HCL Technologies up by 1.99%.

Meanwhile, the watchdog - Insolvency and Bankruptcy Board of India (IBBI) has amended its regulations to allow sale of one or more assets of an entity undergoing insolvency resolution process, besides other changes. This move will provide better market-linked solutions for stressed companies. Also, the Committee of Creditors (CoC) can now examine whether a compromise or an arrangement can be explored for a corporate debtor during the liquidation period.

The IBBI has amended the regulations with the ‘objective to maximise value in resolution’ and they came into effect from September 16. As many as 1,703 Corporate Insolvency Resolution Processes (CIRPs) ended up in liquidation till the end of June this year. The regulator has permitted a resolution professional and the CoC to look for sale of one or more assets of the corporate debtor concerned in cases where there are no resolution plans for the whole business.

The Insolvency and Bankruptcy Code (IBC) provides for a market-linked and time-bound resolution of stressed assets. The amended regulations will also enable a ‘resolution plan to include sale of one or more assets of CD (Corporate Debtor) to one or more successful resolution applicants submitting resolution plans for such assets and providing for appropriate treatment of the remaining assets.’

With the amendments to IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, marketing of assets of a corporate debtor can be done that will help in wider dissemination of information to a wider and targeted audience of potential resolution applicants. It added ‘the amendment also enables a longer time for the asset in the market.'

The CNX Nifty is currently trading at 17847.45, up by 225.20 points or 1.28% after trading in a range of 17744.40 and 17850.40. There were 49 stocks advancing against 1 stock declining on the index.

The top gainers on Nifty were Tata Motors up by 3.54%, Indusind Bank up by 3.16%, Hindalco up by 2.88%, Adani Ports & SEZ up by 2.75% and Eicher Motors up by 2.44%. On the flip side, Grasim Industries down by 0.57% was the only loser.

All the Asian markets are trading in green; Nikkei 225 surged 126.66 points or 0.46% to 27,694.31, Straits Times rose 14.23 points or 0.44% to 3,270.54, Hang Seng jumped 248.11 points or 1.34% to 18,814.08, Taiwan Weighted advanced 63.34 points or 0.44% to 14,489.02, KOSPI rose 11.10 points or 0.47% to 2,366.76, Jakarta Composite added 1.81 points or 0.03% to 7,197.30 and Shanghai Composite was up by 14.27 points or 0.46% to 3,129.87.