Domestic indices trade firm in early deals

Indian equity benchmarks opened higher and extended their previous session’s gains on Wednesday tracking overnight surge on Wall Street as well as broadly positive trend in Asian counterparts, as worries about the outlook for interest rates eased a bit after dovish comments from some US Fed officials lowered expectations for further interest rate hikes for now. Domestic indices are trading firm in early deals with gains of over half a percent each. Traders continue to take support with report that the International Monetary Fund (IMF) raised its India’s GDP growth forecast for the current financial year by 20 basis points (bps) to 6.3%, mainly due to stronger-than-expected consumption during April-June quarter. Some support also came in as the Ministry of Finance said India's gross direct tax collection increased by 17.95 per cent on the year to Rs 11.07 lakh crore in the period from April 1 to October 9. Broader indices are outperforming larger peers with gains of around a percent.

On the sectoral front, IT companies are in focus as TCS kicks-off the Q2 earnings season, and the board will also be considering a proposal for share buyback. In stock specific movements, Bank of Baroda fell after the RBI banned the bank from onboarding new customers on its mobile application.

The BSE Sensex is currently trading at 66523.16, up by 443.80 points or 0.67% after trading in a range of 66299.79 and 66571.98. All the 30 stocks were advancing on the index.

The broader indices were trading in green; the BSE Mid cap index jumped 0.97%, while Small cap index was up by 1.09%.

The top gaining sectoral indices on the BSE were Basic Materials up by 1.20%, Utilities up by 1.19%, Industrials up by 0.97%, Power up by 0.97%, Realty up by 0.92%, while there was no loser on the BSE sectoral front.

The top gainers on the Sensex were Ultratech Cement up by 1.42%, JSW Steel up by 1.42%, Hindustan Unilever up by 1.37%, NTPC up by 1.31% and Infosys up by 1.27%.

Meanwhile, the International Monetary Fund (IMF) in its annual publication, World Economic Outlook (WEO), has projected that India’s gross domestic product (GDP) growth to remain strong at 6.3% in both 2023 and 2024. This is an upward revision of 0.2 percentage point for 2023, reflecting stronger than expected consumption during April-June. The Fund had raised its growth forecast for India for this year by 20 basis points to 6.1 per cent in July and has increased it for the second time. It noted monetary policy projections are consistent with achieving the Reserve Bank of India's inflation target over the medium term.

On the oil import, it said about 35 to 40 per cent of India's crude oil imports came from Russia during April-June 2023, a stark rise from less than 5 per cent before the war in Ukraine. It said ‘While India's oil exports (mostly petroleum products) are small relative to its oil imports (mostly crude oil), India increased its oil exports to the European Union substantially’.

However, the IMF reduced the growth forecast for China by 20 basis points to 5% for 2023 and by 30 basis points to 4.2% for 2024, citing the crash in the real estate sector that has been dragging the economy down. It further said ‘The strongest recovery among major economies has been in the US, where GDP in 2023 is estimated to exceed its pre-pandemic path. The euro area has recovered, though less strongly - with output still 2.2% below pre-pandemic projections, reflecting greater exposure to the war in Ukraine and the associated adverse terms-of-trade shock, as well as a spike in imported energy prices’.

The CNX Nifty is currently trading at 19815.40, up by 125.55 points or 0.64% after trading in a range of 19756.95 and 19832.00. There were 48 stocks advancing against 2 stocks declining on the index.

The top gainers on Nifty were Hindustan Unilever up by 1.42%, Dr. Reddy's Lab up by 1.41%, Adani Enterprises up by 1.34%, JSW Steel up by 1.31% and Ultratech Cement up by 1.26%. On the flip side, SBI Life Insurance down by 0.53% and Coal India down by 0.26% were the only losers.

Asian markets are trading mostly in green; Nikkei 225 surged 262.91 points or 0.83% to 32,009.44, Hang Seng advanced 254.82 points or 1.44% to 17,919.55, Taiwan Weighted added 139.21 points or 0.84% to 16,659.78, KOSPI increased 59.70 points or 2.48% to 2,462.28, Jakarta Composite gained 35.58 points or 0.51% to 6,957.77 and Shanghai Composite strengthened 5.98 points or 0.19% to 3,081.22, while Straits Times fell 8.71 points or 0.27% to 3,190.36.