Firm trade continues over Dalal Street

A firm trade continued over the Dalal Street in early afternoon deals, with both Sensex and Nifty trading with notable gains, amid positive cues from other Asian markets along with heavy buying at Consumer Durables and Utilities counters. Sentiments remained upbeat as India and the US have agreed to closer engagement and cooperation on supply chain, semiconductors and critical minerals during the meeting of the India-US initiative on Critical and Emerging Technology (iCET), led by Indian National Security Adviser Ajit Doval and his US counterpart Jake Sullivan in New Delhi. Besides, in a signification move towards Jai Anusandhan, aimed at promoting innovative Start-ups in the country and to establish an ecosystem of research and entrepreneurship the Department of Telecommunications (DoT) has announced two significant calls for proposals aimed at catalyzing innovation and technological advancement in the telecommunications sector. These initiatives underscore DoT’s commitment to fostering indigenous R&D, promoting IP creation, and achieving inclusive digital growth across India.

On the global front, Asian markets were trading mostly in green, as Singapore posted a trade surplus of SGD4.563 billion in May. That was roughly in line with expectations following the downwardly revised SGD4.516 billion surplus in April (originally SGD4.525 billion). Non-oil domestic exports were down 0.1 percent on month, missing forecasts for an increase of 1.7 percent following the downwardly revised 7/3 percent gain in the previous month (originally 7.6 percent).

The BSE Sensex is currently trading at 77242.63, up by 249.86 points or 0.32% after trading in a range of 77071.44 and 77366.77. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose by 0.35%, while Small cap index was up by 0.82%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.28%, Utilities up by 1.03%, Realty up by 1.00%, Industrials up by 0.97% and PSU up by 0.94%, while Healthcare down by 0.60%, Metal down by 0.04% and Energy down by 0.02% were the few losing indices on BSE.

The top gainers on the Sensex were Wipro up by 2.86%, Power Grid up by 2.52%, Titan up by 1.92%, Mahindra & Mahindra up by 1.49% and SBI up by 1.17%. On the flip side, Maruti Suzuki down by 1.82%, Ultratech Cement down by 1.13%, Tata Steel down by 0.49%, Tata Motors down by 0.47% and Bajaj Finserv down by 0.40% were the top losers.

Meanwhile, domestic rating agency ICRA in its latest report has said that India Inc is bracing for revenue uncertainties in the April-June period (Q1FY25) due to a slowdown in government spending during the Parliamentary elections and the onset of the annual monsoon season. It noted that there was a 6.5 per cent growth in revenues in the March quarter (Q4FY24) as compared to the preceding December quarter (Q3FY24).  

However, the rating agency said that the steady raw material costs will help ensure that the operating profit margin (OPM) will remain steady in the range of 15-18 per cent, and credit metrics will also be largely stable. The agency said its analysis of 558 listed companies' performance in the March quarter indicates an improvement in the profit margins by 0.92 per cent compared to the year-ago period at 17.2 per cent.

The report further said the improvement in profit margins was mainly aided by the softening in commodity prices and benefits of operating leverage, and added that the margins remained flat on a sequential basis. The interest coverage ratio of ICRA’s sample set companies, adjusted for sectors with relatively low debt levels like IT, FMCG and pharma, improved marginally in the March quarter. It said there was a marginal increase in the debt levels and added that sectors like gems and jewellery, construction, sugar, and chemicals borrowed more due to an increase in working capital requirements. 

The CNX Nifty is currently trading at 23538.65, up by 73.05 points or 0.31% after trading in a range of 23499.70 and 23579.05. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Wipro up by 2.86%, Power Grid up by 2.60%, Titan up by 1.92%, Shriram Finance up by 1.83% and LTIMindtree up by 1.45%. On the flip side, Maruti Suzuki down by 1.74%, Ultratech Cement down by 1.22%, Divi's Lab down by 1.17%, Dr. Reddy's Lab down by 1.15% and Tata Steel down by 0.60% were the top losers.

Asian markets were trading mostly in green; Shanghai Composite strengthened 10.69 points or 0.35% to 3,026.58, Straits Times rose 4.69 points or 0.14% to 3,302.24, KOSPI increased 19.82 points or 0.72% to 2,763.92, Nikkei 225 surged 379.67 points or 0.99% to 38,482.11 and Taiwan Weighted added 260.9 points or 1.15% to 22,757.43, while Hang Seng declined 36.46 points or 0.2% to 17,899.66.