Markets extend previous session's gains with positive opening

With a positive opening, Indian equity benchmarks have extended their previous session's gains and are now trading higher by over a quarter percent, with both Sensex and Nifty rising above their psychological 59100 and 17550 levels respectively. Meanwhile, the session was also proving positive for broader indices which are trading with gains in the range of 0.40-0.50%. Sentiments got boost on the back of firm global cues and falling crude oil prices. Further, some support came as Icra Ratings said after rising steeply for a month, the cost of market borrowing for states declined sharply on Tuesday with the weighted average cut-off falling by 11 basis points to 7.72 per cent from 7.83 per cent last week. Traders took a note of report that Tuhin Kanta Pandey, secretary in the Department of Investment and Public Asset Management, said the Indian government should focus on privatisation of state-run companies instead of chasing high divestment targets, pointing to market volatility and investors’ shaky appetite for risk. 

On the global front, Asian markets were mostly trading in green following the positive cues from global markets overnight, reflecting a positive reaction to upbeat earnings news from US financial companies and renewed optimism over upcoming earnings. The US markets ended higher on Tuesday as strong corporate earnings reports helped extend a rally to start the week.

Back home, there were some buzz in agriculture related stocks as government said the hike in the minimum support price of several Rabi crops will further energise the agriculture sector. The government hiked the minimum support price (MSP) of six Rabi crops by up to 9 per cent, with Rs 110 per quintal increase for wheat crop to boost domestic production and farmers’ income.  On the BSE sectoral front, traders were seen piling up position in Capital Goods, Industrials, Auto, Power and Utilities, while selling was witnessed in TECK, IT down and Metal.

The BSE Sensex is currently trading at 59189.31, up by 228.71 points or 0.39% after trading in a range of 59148.52 and 59343.03. There were 20 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.46%, while Small cap index up by 0.40%.

The top gaining sectoral indices on the BSE were Capital Goods up by 0.96%, Industrials up by 0.69%, Auto up by 0.63%, Power up by 0.56% and Utilities up by 0.55%, while TECK down by 0.23%, IT down by 0.22% and Metal down by 0.22% were the only losing indices on BSE.

The top gainers on the Sensex were HDFC up by 3.32%, HDFC Bank up by 1.99%, Power Grid Corp up by 1.55%, Larsen & Toubro up by 1.12% and Mahindra & Mahindra up by 0.80%. On the flip side, HCL down by 0.93%, SBI down by 0.87%, Tata Steel down by 0.55%, Infosys down by 0.47% and Bajaj Finserv down by 0.28% were the top losers.

Meanwhile, the Department of Investment and Public Asset Management’s (DIPAM’s) Secretary Tuhin Kanta Pandey has said that the Indian government should focus on privatisation of state-run companies instead of chasing high divestment targets, pointing to market volatility and investors' shaky appetite for risk.

Last fiscal year, the government raised just over Rs 13,500 crore ($1.6 billion) from the sale of stakes in state-owned firms, a fraction of its target of Rs 1.75 trillion and missing its divestment goal for a third straight year. He said ‘We should actually have moderate targets and more focus should be on privatising’.

The Indian government has set a Rs 65,000 crore ($7.89 billion) divestment and privatisation target for 2022/23, out of which it raised 245.44 billion rupees in the first seven months of the fiscal year. He stated high targets lead to a perception that the government will sell minority stakes in state-run companies, prompting a fall in share prices of such firms.

The CNX Nifty is currently trading at 17560.20, up by 73.25 points or 0.42% after trading in a range of 17535.75 and 17585.40. There were 30 stocks advancing against 19 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were HDFC up by 3.17%, HDFC Bank up by 1.99%, Power Grid Corp up by 1.79%, Larsen & Toubro up by 1.42% and Cipla up by 1.31%. On the flip side, HCL down by 0.87%, SBI down by 0.84%, Tata Steel down by 0.60%, ONGC down by 0.54% and JSW Steel down by 0.49% were the top losers.

Asian markets are trading mostly in green, Nikkei 225 surged 143.81 points or 0.53% to 27,299.95, Jakarta Composite soared 19.28 points or 0.28% to 6,853.77, KOSPI rose 3.29 points or 0.15% to 2,253.24, Straits Times advanced 13.51 points or 0.45% to 3,039.39. However, Taiwan Weighted dropped 66.31 points or 0.51% to 13,058.37, Hang Seng decreased 178.91 points or 1.06% to 16,735.67 and Shanghai Composite declined 15.78 points or 0.51% to 3,065.18.