Markets maintain gains in late morning deals

Indian equity indices maintained their gains in late morning deals as market participants indulged in the enlarging their positions. Meanwhile, broader indices outperformed their large peers with BSE Mid cap index and Small cap index gaining in the range of 1.80-2.40%. Buying in Zomato, Ultratech Cement, Bajaj Finserv, Tata Steel and Tech Mahindra companies’ stocks helped the markets to maintain their gains. Positive cues from the global markets supported domestic sentiments. Investors focused on the US Federal Reserve interest rate decision later in the day and the upcoming Union Budget this weekend. Traders took a note of report that India and Oman signed an agreement to amend their taxation treaty - Double Taxation Avoidance Agreement (DTAA) - in an attempt to align it with international standards on cross-border taxation, simplifying tax procedures, and promoting greater cooperation in tax matters.

On the global front, Japan stock market -- Nikkei 225 rose following positive cues from the US markets overnight. Several Asia-Pacific markets were closed for the Lunar New Year holiday. Back home, almost all the sectoral indices on BSE were trading into positive territory; however stocks from FMCG counter was the only exception. Stocks from Industrials, Capital Goods, Basic Materials, Consumer Disc and IT counters were the prominent gainers of the session.

The BSE Sensex is currently trading at 76230.26, up by 328.85 points or 0.43% after trading in a range of 75975.80 and 76420.97. There were 26 stocks advancing against 5 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.82%, while Small cap index up by 2.39%.

The top gaining sectoral indices on the BSE were Industrials up by 2.16%, Capital Goods up by 1.96%, Basic Materials up by 1.72%, Consumer Disc up by 1.63% and IT up by 1.58%, while FMCG down by 0.81% was the only losing index on BSE.

The top gainers on the Sensex were Zomato up by 3.12%, Ultratech Cement up by 1.93%, Bajaj Finserv up by 1.71%, Tata Steel up by 1.63% and Tech Mahindra up by 1.60%. On the flip side, ITC down by 0.86%, NTPC down by 0.83%, Asian Paints down by 0.49%, Hindustan Unilever down by 0.32% and Axis Bank down by 0.10% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) has said that it will conduct a USD/INR buy-sell swap auction of $5 billion (about Rs 43,000 crore) for a tenor of 6 months on January 31, 2025 as part of its over Rs 1.5 lakh crore liquidity injection into the banking system. The swap is in the nature of a simple buy/sell foreign exchange swap from the RBI side. A bank shall sell US dollars to the Reserve Bank and simultaneously agree to buy the same amount of US dollars at the end of the swap period. 

RBI said under the swap auction, minimum bid size would be $10 million and in multiples of $1 million thereafter. The eligible participants are allowed to submit multiple bids. However, the aggregate amount of bids submitted by single eligible entity should not exceed the notified amount of auction. It said OMO purchase auctions of Government of India securities for an aggregate amount of Rs 60,000 crore in three tranches of Rs 20,000 crore each will be held on January 30, 2025, February 13, 2025, and February 20, 2025. The 56-day Variable Rate Repo (VRR) auction for a notified amount of Rs 50,000 crore will be held on February 7, 2025.

The RBI had announced open market operations (OMO) purchase auctions of government bonds aggregating Rs 60,000 crore, Variable Rate Repo (VRR) auction of Rs 50,000 crore and foreign exchange swap of $5 billion. The decision on liquidity injections comes days ahead of RBI’s next bi-monthly monetary policy in which the Monetary Policy Committee may opt for a reduction in the benchmark lending rate. 

The CNX Nifty is currently trading at 23066.45, up by 109.20 points or 0.48% after trading in a range of 22976.50 and 23125.85. There were 40 stocks advancing against 11 stocks declining on the index.

The top gainers on Nifty were Bharat Electronics up by 2.71%, Bajaj Auto up by 2.62%, Shriram Finance up by 2.29%, Eicher Motors up by 1.88% and Ultratech Cement up by 1.87%. On the flip side, BPCL down by 1.76%, Tata Consumer down by 1.08%, NTPC down by 0.96%, ITC down by 0.92% and Britannia down by 0.79% were the top losers.

On global front, Nikkei 225 rose 242.91 points or 0.62% to 39,259.78.