Sensex, Nifty trade higher with notable gains on value buying

Indian equity benchmarks made an optimistic start on Wednesday tracking firm global cues. Sensex and Nifty are trading higher with notable gains of around 0.35% each in early deals on account of value buying in almost all the sectoral indices except FMCG. Some support came on report that ahead of Union Budget on February 1, a quick survey conducted by the Federation of Indian Chambers of Commerce and Industry (FICCI) noted that about 64 per cent of industrialists expressed optimism regarding India’s growth. Traders took note of report that the Reserve Bank said it will conduct a USD/INR buy-sell swap auction of $5 billion (about Rs 43,000 crore) on January 31, as part of its over Rs 1.5 lakh crore liquidity injection into the banking system. 

On the global front, the Japanese stock market is trading higher on Wednesday, snapping the three-session losing-streak, following the broadly positive cues from Wall Street overnight. All other markets, including China, Hong Kong, Singapore, South Korea, Malaysia, Taiwan and Indonesia, are closed for the Lunar New Year holidays. Traders also remain cautious ahead of the US Fed's interest rate decision later in the day.

Back home, real estate sector stocks are in focus as India Ratings and Research (Ind-Ra) said housing prices are likely to rise 3-4 per cent next fiscal on high base effect and better supply. Ind-Ra expects property prices to increase 5-6 per cent year-on-year (YoY) in 2024-25 fiscal, then moderate to 3-4 per cent YoY for 2025-26, due to base effects and new launches. In stock specific development, Bharat Heavy Electricals traded with traction after its Q3 consolidated net profit more than doubles to Rs 135 crore versus Rs 60.3 crore (Y-o-Y).

The BSE Sensex is currently trading at 76169.38, up by 267.97 points or 0.35% after trading in a range of 75983.53 and 76257.28. There were 22 stocks advancing against 8 stocks declining, while 1 stock remain unchanged on the index.

The broader indices were trading in green; the BSE Mid cap index rose 1.77%, while Small cap index was up by 2.14%.

The top gaining sectoral indices on the BSE were Industrials up by 2.23%, IT up by 1.99%, Capital Goods up by 1.99%, Consumer Discretionary up by 1.50% and Power up by 1.42%, while FMCG down by 0.80% was the sole losing index on BSE.

The top gainers on the Sensex were Zomato up by 2.62%, Infosys up by 1.82%, Tech Mahindra up by 1.74%, HCL Technologies up by 1.56% and TCS up by 1.40%. On the flip side, Hindustan Unilever down by 0.77%, Nestle down by 0.51%, Bharti Airtel down by 0.48%, ITC down by 0.41% and Asian Paints down by 0.19% were the top losers.

Meanwhile, ahead of Union Budget on February 1, the Federation of Indian Chambers of Commerce and Industry (FICCI) in its Pre-budget 2025-26 Survey showed that about 64 per cent of industrialists expressed optimism regarding India’s growth. According to the survey results, nearly 60 per cent of participants projected a GDP growth rate between 6.5 and 6.9 per cent for 2025-26. Though the numbers mark a moderation from the high growth of over 8.0 per cent witnessed in 2023-24 - it is in sync with persistent headwinds on account of external factors. 

The survey said ‘The Government’s commitment to fiscal consolidation has put us in a good state and the survey participants expected the government to remain on that course’. According to the survey, about 47 per cent of participants expected the government to meet the fiscal deficit target of 4.9 per cent for FY 2024-25 and another 24 per cent reported that the government could improve and report a lower fiscal deficit number for the current year.

A significant focus of the survey was on macroeconomic policy interventions. The majority of respondents highlighted the need for sustaining public capital expenditure, with 68 per cent calling for a thrust on capex to sustain the growth momentum. At least a 15 per cent increase in capex allocation for FY 2025-26 is being looked forward to by members of the Indian industry. Additionally, over half of the respondents emphasised the importance of reforms to further enhance the ease of doing business. Reforms pertaining to factors of production - particularly with respect to areas like land acquisition, labour regulations, and power supply - remain important.

Further, concern was expressed regarding the muted demand situation. A significant number of industry members have called for a review of the direct tax structure. A relook at the slabs and the tax rates is warranted as this could leave more money in the hands of people and spur consumption demand in the economy. The respondents also called for a strong policy push on simplifying the tax regime, incentivizing the development of green technologies/renewables and EVs, and easing compliances through digitization.

On the taxation front, providing tax certainty, addressing custom duty inversion, and rationalization of TDS provisions were highlighted as important themes by the participants. The participants also showed support for an amnesty scheme under customs, with 54 per cent favouring its introduction to enable swift resolution of disputes. The current round of FICCI’s Survey was conducted between late December 2024 and mid-January 2025. The survey drew responses from over 150 companies spanning diverse sectors, offering a comprehensive insight into India Inc’s sentiments amidst moderating economic growth.

The CNX Nifty is currently trading at 23040.45, up by 83.20 points or 0.36% after trading in a range of 22976.50 and 23069.85. There were 38 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Bajaj Auto up by 4.05%, Bharat Electronics up by 2.34%, Wipro up by 2.01%, Shriram Finance up by 1.80% and Infosys up by 1.74%. On the flip side, BPCL down by 1.59%, Tata Consumer Products down by 1.37%, Britannia Industries down by 0.75%, Hindustan Unilever down by 0.65% and Nestle down by 0.52% were the top losers.

On global front, Nikkei 225 rose 330.57 points or 0.85 per cent to 39,347.44.