Benchmarks continue to trade with healthy gains

Indian equity benchmarks continued to trade with healthy gains in late morning deals as market participants indulged in enlarging positions. Encouraging earnings updates from IT firms Infosys and MindTree also buoyed sentiment. Meanwhile, broader indices were also trading with gains in the range of 0.75-0.90%. Traders were getting encouragement with report that S&P Global Ratings said growth in large Asia Pacific economies like China, India and Indonesia will be less affected as their economies are more domestically oriented.

On the global front, Asian markets were trading mostly in green following the broadly positive cues from US markets overnight. Back home, all the sectoral indices on the BSE were trading in green led by IT, TECK, Bankex, Capital Goods and Industrials.  On stock specific development, Anand Rathi Wealth rallied after the company announced a strong set of numbers in the September 2022 quarter.

The BSE Sensex is currently trading at 58293.98, up by 1058.65 points or 1.85% after trading in a range of 58097.10 and 58322.47. There were all 30 stocks advancing on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.78%, while Small cap index up by 0.88%.

The top gaining sectoral indices on the BSE were IT up by 2.95%, TECK up by 2.78%, Bankex up by 1.93%, Capital Goods up by 1.83% and Industrials up by 1.57%, while there were no losing sectoral indices on the BSE.

The top gainers on the Sensex were Infosys up by 5.01%, HCL Tech. up by 3.61%, HDFC Bank up by 3.21%, Larsen & Toubro up by 3.07% and HDFC up by 2.92%, while there were no losers.

Meanwhile, rating agency ICRA in its latest report has estimated that the 13 state governments have the fiscal space to incur capital spending of as much as Rs 7.4 trillion in FY2023, rivalling the size of the government’s capex budgeted for this fiscal. The 13 states, having nearly 85 per cent share in India's GDP in 2020-21, had made a capital expenditure of Rs 4.1 lakh crore last fiscal. While the availability of funds doesn't appear to be a constraint in FY2023, the actual outgo incurred by these state governments in the early months of this fiscal has been rather muted. Their Budget estimate for capex spending this fiscal is Rs 5.8 lakh crore.

ICRA estimates the combined revenue deficit of these 13 states will be at Rs 2.1 lakh crore, higher than the Rs 1.8 lakh crore budgeted. While tax devolution as well as the goods and services tax (GST) compensation grants are likely to exceed the amount budgeted by the states in the sample in FY2023, this will not fully offset the estimated shortfall in other revenues and the projected higher-than-budgeted revenue expenditure in this fiscal.

The report assess that Andhra Pradesh, Gujarat, Karnataka, Madhya Pradesh, Maharashtra, Tamil Nadu, Uttar Pradesh and West Bengal will have adequate resources to fully fund or exceed their budgeted capex for FY2023. However, it said the fiscal space available for Haryana, Rajasthan, Kerala, Punjab, and Telangana appears to trail the capex budgeted for the current fiscal by a varying extent, suggesting that additional revenue mobilisation and/or expenditure efficiency measures may need to be found to boost capex.

The CNX Nifty is currently trading at 17305.05, up by 290.70 points or 1.71% after trading in a range of 17251.40 and 17331.65. There were 47 stocks advancing against 3 stocks declining on the index.

The top gainers on Nifty were Infosys up by 4.94%, HCL Tech. up by 3.65%, HDFC Bank up by 3.20%, Larsen & Toubro up by 2.98% and HDFC up by 2.92%. On the flip side, JSW Steel down by 0.22% and ONGC down by 0.19% were the only losers.

Asian markets were trading mostly in green, Nikkei 225 surged 901.96 points or 3.44% to 27,139.38, Taiwan Weighted strengthened 342.45 points or 2.67% to 13,153.18, Hang Seng increased 622.59 points or 3.8% to 17,011.70, KOSPI rose 50.58 points or 2.34% to 2,213.45, Straits Times advanced 26.60 points or 0.87% to 3,067.05 and Shanghai Composite gained 65.12 points or 2.16% to 3,081.48. However, Jakarta Composite lost 9.64 points or 0.14% to 6,870.99.