Bulls hold grip over Dalal Street in early noon deals

Bulls were holding a tight grip over the Dalal Street in early afternoon deals, with both Sensex and Nifty continuing their northward rally, aided by heavy buying at IT and Telecom counters along with positive cues from other Asian markets. Domestic sentiment remained optimistic as the government came out with Foreign Trade Policy (FTP) 2023 which seeks to boost the country's exports to $2 trillion by 2030 by shifting from incentives to remission and entitlement-based regime. Adding more relief over the street, the Government given full exemption from basic customs duty on all drugs and Food for Special Medical Purposes imported for personal use for treatment of all Rare Diseases listed under the National Policy for Rare Diseases 2021 through a general exemption notification.

On the global front, Asian markets were trading mostly in green as China's service sector activity expanded at the fastest pace in twelve years in March following the lifting of pandemic related restrictions last year but manufacturing activity posted a slower growth. The survey results from the National Bureau of Statistics showed that the non-manufacturing Purchasing Managers' Index, which takes into account the business conditions in services and construction, unexpectedly advanced to 58.2 in March from 56.3 in February.

The BSE Sensex is currently trading at 58710.67, up by 750.58 points or 1.29% after trading in a range of 58273.86 and 58720.54. There were 24 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 1.04%, while Small cap index was up by 1.45%.

The top gaining sectoral indices on the BSE were IT up by 1.87%, Telecom up by 1.72%, TECK up by 1.68%, Energy up by 1.63% and Oil & Gas up by 1.42%, while there were no losing sectoral indices on the BSE

The top gainers on the Sensex were Reliance Industries up by 3.75%, ICICI Bank up by 2.82%, Nestle up by 2.41%, Tata Motors up by 2.19% and Infosys up by 2.09%. On the flip side, Bajaj Finance down by 0.46%, Sun Pharma down by 0.43%, Titan Company down by 0.41%, Hindustan Unilever down by 0.17% and Maruti Suzuki down by 0.13% were the top losers.

Meanwhile, India Ratings and Research (Ind-Ra) in its latest report has said that clawing the economy back to an 8 per cent growth path will require bringing savings and investment rates closer to 35 per cent on a sustained basis, which were 30.2 and 29.6 per cent, respectively, in FY22. It said a large part of investments will have to be in infrastructure, which can help revive private investments by easing supply constraints and offset the weakening of external demand due to global headwinds.

The report said higher investments will have to be accompanied by higher domestic savings to keep the savings-investments gap under check. The big missing link now is the government's focus on stepped-up capital expenditure on infrastructure, but not enough commensurate steps to encourage savings. This is because, this government, in its bid to simplify the income tax structure, has been steadily doing away with various incentives for savings, impacting household savings, which has been the mainstay of overall savings in the economy.

The agency said after the 6.6 per cent contraction in FY21, the economy is expected to close the outgoing fiscal with a 7 per cent growth, down from 8.7 per cent in FY22 and fall further to 5.9 per cent next fiscal. It said that these growth rates are not enough for the nation to reap the benefit of demographic dividends, which demands that the economy has to clip at a sustained growth rate of over 8 per cent over the next two-three decades to keep the massive youth in the workforce. It can be noted that investment and savings rates jumped significantly during FY 04-08 when the economy had its best growth rates. The investment rate rose 39.8 per cent in FY11, but since then, it has been on a downslide, primarily due to the difficulties faced in project implementation and stagnation in capacity utilisation of the manufacturing sector.

The CNX Nifty is currently trading at 17287.75, up by 207.05 points or 1.21% after trading in a range of 17204.65 and 17291.95. There were 37 stocks advancing against 12 stocks declining, while one stock remained unchanged on the index.

The top gainers on Nifty were Reliance Industries up by 3.86%, ICICI Bank up by 2.89%, Nestle up by 2.42%, Infosys up by 2.15% and Tata Motors up by 2.13%. On the flip side, Apollo Hospital down by 0.53%, Sun Pharma down by 0.50%, Bajaj Finance down by 0.39%, Hindustan Unilever down by 0.36% and Titan Company down by 0.36% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 258.55 points or 0.92% to 28,041.48, Hang Seng advanced 100.93 points or 0.5% to 20,410.06, KOSPI increased 23.7 points or 0.96% to 2,476.86, Taiwan Weighted added 18.63 points or 0.12% to 15,868.06, Shanghai Composite strengthened 7.09 points or 0.22% to 3,268.34 and Straits Times rose 5.26 points or 0.16% to 3,262.44, while Jakarta Composite plunged 5.63 points or 0.08% to 6,803.32.