Benchmarks add some gains in morning deals

Indian equity benchmarks added some gains in morning deals, led by gains in Utilities, Power and Metal stocks. Traders took support as Moody’s Investors Service affirmed India’s sovereign rating at ‘Baa3’ with stable outlook and said high growth will support a gradual increase in income levels, which will further contribute to economic strength. It expects India’s economic growth to outpace all other G20 economies through at least the next two years, driven by domestic demand. Some optimism also came with latest data by the Reserve Bank of India showing that India’s foreign exchange reserves snapped a three-week losing streak and increased by $708 million to $602 billion in the week ended August 11. The rise in the reserves was mainly on account of an increase in the foreign currency assets, which grew by $999 million to $534 billion in the previous week. Adding to the optimism, Minister of State for Road Transport, Highways and Civil Aviation Gen V K Singh, said with the Centre’s focus on development and infrastructure, India has gained the trust of many countries, which have come forward to invest in the country. 

On the global front, Asian markets are trading mixed as traders remain cautious and restrained from making any significant moves after upbeat US data raised fears the US Fed will hold interest rates higher for longer to control inflation. Traders also picked up stocks at a bargain after the recent slump in the markets. Back home, stocks related to plastic industry remained in watch as the All India Plastics Manufacturers' Association’s President Mayur D Shah stated that India has the potential to emerge as a global plastic supplier and the domestic plastic market is expected to more than triple to reach Rs 10 lakh crore by 2027-28.

The BSE Sensex is currently trading at 65088.09, up by 139.43 points or 0.21% after trading in a range of 64852.70 and 65137.06. There were 25 stocks advancing against 5 stocks declining, while 1 stock remain unchanged on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.63%, while Small cap index was up by 0.47%.

The top gaining sectoral indices on the BSE were Utilities up by 1.71%, Power up by 1.59%, Metal up by 0.78%, Healthcare up by 0.59% and PSU up by 0.50%, while Energy down by 0.11% and Oil & Gas down by 0.06% were the top losing indices on BSE.

The top gainers on the Sensex were Power Grid Corporation up by 1.70%, Bajaj Finance up by 1.40%, NTPC up by 1.28%, Tata Motors up by 1.03% and Bharti Airtel up by 0.87%. On the flip side, Reliance Industries down by 1.22%, Mahindra & Mahindra down by 0.70%, Maruti Suzuki down by 0.05%, Larsen & Toubro down by 0.04% and SBI down by 0.03% were the top losers.

Meanwhile, Finance Secretary T V Somanathan has said that the government will stick to the fiscal deficit target of 5.9 per cent of the Gross domestic product (GDP) in FY24 as robust tax, non-tax collections will help meet the spending requirement and make up for any shortfall in disinvestment proceeds. He said although there would be a shortfall with respect to disinvestment, this shortfall would be met by non-tax revenue mobilisation.

It stated ‘Disinvestment target is unlikely to be met. However, I would say in aggregate the collective amount between disinvestment and non-tax revenue is likely to be very close to the budget. The total of disinvestment receipts, plus non-tax receipts are likely to be very close to the Budget Estimates.  He said ‘We expect to adhere to our fiscal deficit target this year...none of the events so far have caused anything for us to deviate from it.’

The government has already got a higher dividend from the Reserve Bank of India and expects higher dividends from public sector banks and other PSUs than estimated in the Budget. The Reserve Bank of India in May approved a Rs 87,416 crore-dividend payout to the central government for 2022-23, nearly triple of what it paid in the previous year. The government was expecting Rs 48,000 crore from the RBI, public sector banks and financial institutions in the current fiscal.

The CNX Nifty is currently trading at 19345.30, up by 35.15 points or 0.18% after trading in a range of 19296.30 and 19368.00. There were 40 stocks advancing against 10 stocks declining,while 1 stock remain unchanged on the index.

The top gainers on Nifty were Adani Ports &SEZ up by 2.10%, Power Grid Corporation up by 1.62%, Hindalco up by 1.43%, Adani Enterprises up by 1.35% and UPL up by 1.35%. On the flip side, Reliance Industries down by 1.25%, Mahindra & Mahindra down by 0.77%, BPCL down by 0.37%, Eicher Motors down by 0.32% and Larsen & Toubro down by 0.23% were the top losers.

Asian markets are trading mixed; Taiwan Weighted lost 19.71 points or 0.12% to 16,361.60, Hang Seng declined 219.24 points or 1.22% to 17,731.61, Shanghai Composite weakened 5.27 points or 0.17% to 3,126.68 and Straits Times fell 14.73 points or 0.46% to 3,159.20.

On the flip side, Nikkei 225 surged 115.18 points or 0.37% to 31,565.94, KOSPI increased 7.53 points or 0.3% to 2,512.03 and Jakarta Composite gained 7.52 points or 0.11% to 6,867.43.