Benchmarks continue to trade higher in morning deals

Indian equity benchmarks continued to trade higher in morning deals, on strong macroeconomic data, elevated bets of a U.S. rate cut in March, and the ruling Bharatiya Janata Party's win in key state elections. Sentiments remained up-beat with Finance Minister Nirmala Sitharaman’s statement that the GST collection has been showing an upward trend on an annual basis since its rollout on July 1, 2017, and the average gross monthly mop-up in the current fiscal so far is Rs 1.66 lakh crore. She said the GST collection crossed Rs 1.50 lakh crore mark in every month of the current fiscal and had touched a record high of Rs 1.87 lakh crore in April 2023. Traders paid no heed towards private survey showed India's service sector activity expanded at its lowest pace in November. According to S&P Global, India's services Purchasing Managers' Index (PMI) in November fell to 56.9 as compared to 58.4 in October. This is the lowest figure in 2023 so far. Before this, services PMI was recorded at 57.2 in January. On the global front, Asian markets are trading lower as investors tempered expectations for cuts to U.S. interest rates and waited on U.S. jobs data. 

The BSE Sensex is currently trading at 69284.66, up by 419.54 points or 0.61% after trading in a range of 68954.88 and 69336.44. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.41%, while Small cap index was up by 0.36%.

The top gaining sectoral indices on the BSE were Utilities up by 2.27%, Power up by 2.11%, Bankex up by 1.41%, Basic Materials up by 1.16% and Oil & Gas up by 1.15%, while IT down by 0.76%, TECK down by 0.45% and Realty down by 0.18% were the top losing indices on BSE.

The top gainers on the Sensex were SBI up by 2.37%, ICICI Bank up by 2.12%, Mahindra & Mahindra up by 1.94%, HDFC Bank up by 1.22% and Axis Bank up by 1.19%. On the flip side, HCL Tech. down by 1.72%, Infosys down by 0.99%, Bajaj Finserv down by 0.93%, Tech Mahindra down by 0.77% and Wipro down by 0.43% were the top losers.

Meanwhile, Icra in its latest report has said that the primary steel industry is likely to experience a challenging environment during the second half of current financial year (H2FY24) amid increased input cost and weakening steel prices. It stated the domestic hot rolled coil (HRC) prices have corrected by 6.7 per cent since early October 2023, while the rebar prices witnessed a fall of 4.7 per cent in the same period.

Further, it said the overall industry's operating profit margins in H2 FY24 are expected to be lower compared to H1 FY2024, largely driven by weaker profitability from the blast furnace operators. Besides, it said coupled with the higher resilience of long steel prices, the operating profit margins of secondary steelmakers are projected to be higher by 75 basis points in H2 over H1 of FY24, even as primary producers, which are primarily blast furnace players, are slated to witness a drop in operating margins by 135 basis points over the same period. Primary steel players manufacture steel through blast furnace route and the secondary industry uses electric arc furnaces and induction furnaces to manufacture steel.

Jayanta Roy, Senior Vice-President and Group Head, Corporate Sector Ratings, Icra said due to supply-related constraints in Australia, spot premium hard coking coal cargoes unexpectedly rallied up by 50-55 per cent in a short span of three months, reaching an interim high of USD 363/MT (metric tonne fob Australia) in mid-October 2023. He added the blast furnace operators have been diversifying their coal sourcing by progressively reducing the share of coking coal imports from Australia from 71 per cent in FY22 to 52 per cent in H1 FY24.

The CNX Nifty is currently trading at 20816.10, up by 129.30 points or 0.63% after trading in a range of 20711.15 and 20834.00. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Adani Enterprises up by 7.88%, Adani Ports &SEZ up by 7.19%, SBI up by 2.44%, BPCL up by 2.23% and ICICI Bank up by 2.00%. On the flip side, HCL Technologies down by 1.73%, LTIMindtree down by 1.14%, Infosys down by 1.02%, Bajaj Auto down by 0.99% and Bajaj Finserv down by 0.90% were the top losers.

All Asian markets are trading lower; Nikkei 225 slipped 392.55 points or 1.18% to 32,838.72, Taiwan Weighted lost 120.18 points or 0.69% to 17,301.30, Hang Seng declined 292.18 points or 1.79% to 16,353.87, Straits Times fell 10.26 points or 0.33% to 3,073.82, KOSPI dropped 12.14 points or 0.48% to 2,502.81, Jakarta Composite plunged 21.57 points or 0.3% to 7,072.03 and Shanghai Composite weakened 20.82 points or 0.69% to 3,002.09.