Domestic indices extend opening gains in early deals

Indian markets made optimistic start on Monday tracking firm cues from global markets and positive earnings results from prominent companies. Soon, domestic indices extended their gains in early deals on account of buying in Bankex, Telecom and Auto counters. Traders took encouragement as India’s forex reserves zoomed by $10.417 billion to $572 billion as on January 13, making it one of the biggest weekly jumps in the kitty in recent times. In the previous reporting week, the overall reserves had dropped by $1.268 billion to $561.583 billion. On the global front, the Japanese stock market is trading significantly higher, extending the gains in the previous session, following the broadly positive cues from global markets on Friday, with most markets closed for the Lunar New Year holidays. Some traders looked to pick up stocks at relatively reduced levels following recent weakness. Most of the Asian markets are closed for the Lunar New Year holiday, including South Korea, Malaysia, Singapore, Taiwan, China, Hong Kong and Indonesia.

The BSE Sensex is currently trading at 61082.68, up by 460.91 points or 0.76% after trading in a range of 60761.88 and 61111.97. There were 26 stocks advancing against 4 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index rose 0.12%, while Small cap index was down by 0.14%.

The top gaining sectoral indices on the BSE were Bankex up by 1.10%, Telecom up by 0.96%, Auto up by 0.79%, Energy up by 0.63%, TECK up by 0.61%, while Realty down by 0.52% was the sole losing index on BSE.

The top gainers on the Sensex were Power Grid up by 1.93%, Kotak Mahindra Bank up by 1.69%, Mahindra & Mahindra up by 1.35%, Tata Motors up by 1.34% and Bharti Airtel up by 1.16%. On the flip side, Ultratech Cement down by 1.79%, NTPC down by 0.74%, Tata Steel down by 0.33% and Asian Paints down by 0.29% were the top losers.

Meanwhile, in light of the economic slowdown caused by the COVID-19 pandemic, the commerce ministry has given a one-time relaxation for exporters from hotel, healthcare, and educational sectors with respect to maintaining the average export obligation under the Export Promotion Capital Goods (EPCG) scheme. Under the scheme, imports of capital goods are allowed duty free, subject to an export obligation.

It added that this relief will help the hotel, healthcare and educational sectors to cope with the negative impact of the pandemic on their export activities. For 2020-21 and 2021-22, these sectors will not be required to maintain the average export obligation for EPCG authorisations issued to them. These sectors will also have the option to extend the export obligation period for a longer duration without having to pay any additional fees.

It further said ‘This extension will be granted without payment of composition fees. However, for EPCG authorisations issued for sectors other than hotel, healthcare and educational, the export obligation period may be extended for the number of days the existing export obligation period falls within February 1, 2020 and July 31, 2021’. In such cases, the extension will be granted without payment of composition fees, but with a 5 per cent additional export obligation in value terms on the balance export obligation as on March 31, 2022.

The scheme aims to encourage the production of goods for export by providing import duty concessions on capital goods. It is administered by the Directorate General of Foreign Trade (DGFT) and is governed by the Foreign Trade Policy of India.

The CNX Nifty is currently trading at 18154.90, up by 127.25 points or 0.71% after trading in a range of 18063.45 and 18162.00. There were 40 stocks advancing against 10 stocks declining on the index.

The top gainers on Nifty were Power Grid up by 1.90%, Hero MotoCorp up by 1.72%, Kotak Mahindra Bank up by 1.49%, UPL up by 1.43% and Mahindra & Mahindra up by 1.39%. On the flip side, Ultratech Cement down by 1.65%, JSW Steel down by 0.89%, NTPC down by 0.71%, Adani Ports &Special down by 0.40% and Tata Steel down by 0.37% were the top losers.

Japanese stock market -- Nikkei 225 surged 345.23 points or 1.3% to 26,898.76.