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Markets trade in fine fettle in early deals; Sensex reclaims 35,600 mark
Feb-19-2019

Indian equity markets made a positive start and extended their gains in early deals on Tuesday, with Sensex and Nifty reclaiming their 35,600 and 10,650 levels, respectively, on the back of firm trade in Asian counterparts. Gains were led by Realty and Telecom stocks, however weakness was seen in IT and TECK counters. Traders were taking encouragement with the Reserve Bank of India (RBI) in its board meeting on February 18 decided to transfer Rs 28,000 crore as interim dividend to the government for the period of July to December 2018. The interim surplus has been decided after a limited audit review and after applying the Economic Capital Framework. Adding to the optimism the RBI said it would inject Rs 12,500 crore into the system through purchase of government securities on February 21 to increase liquidity. The purchase will be made through open market operations (OMOs).

On the global front, Asian markets are trading mostly higher with investors cautiously optimistic that China and the US can reach a deal ending their trade war as the two sides prepare to resume talks this week. Back home, on the sectoral front, telecom sector stocks buzzing with report that industry body COAI has written to the Telecom Department saying financial support and subsidies should be provided to facilitate major 5G trials in India, and that permissions and fee on network equipment purchases need to be waived for the entire trial period.

The BSE Sensex is currently trading at 35648.22, up by 149.78 points or 0.42% after trading in a range of 35477.47 and 35656.36. There were 24 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.71%, while Small cap index was up by 0.68%.

The top gaining sectoral indices on the BSE were Realty up by 2.65%, Telecom up by 2.28%, Consumer Durables up by 1.04%, Energy up by 0.90% and Auto was up by 0.88%, while IT down by 0.93% and TECK was down by 0.61% were the only losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 2.64%, Bajaj Finance up by 1.80%, Mahindra & Mahindra up by 1.65%, ICICI Bank up by 1.52% and Vedanta was up by 1.35%. On the flip side, TCS down by 1.34%, Infosys down by 1.16%, Tata Motors down by 0.34%, Hindustan Unilever down by 0.33% and Tata Motors - DVR was down by 0.24% were the top losers.

Meanwhile, in order to increase liquidity into the market, the Reserve Bank of India (RBI) said it would inject Rs 12,500 crore into the system through purchase of government securities on February 21, 2019. The purchase will be made through open market operations (OMOs).

The central bank in its release said based on an assessment of prevailing liquidity conditions and also of the durable liquidity needs going forward, it has decided to conduct purchase of government securities under OMOs for an aggregate amount of Rs 125 billion on February 21, 2019.

The eligible participants should submit their offers in electronic format on the RBI core banking solution (E-Kuber) system on February 21. The result of the auction will be announced on the same day and payment to successful participants will be made on the following day. Recently, RBI had injected Rs 20,000 crore into the system through OMOs in January 2019.

OMOs are financial tools to either inject or suck out liquidity from the system. When the liquidity is tight, money is pumped into the market by purchase of government securities. While in the case of surplus, the excess money is sucked out by selling of government bonds.

The CNX Nifty is currently trading at 10681.15, up by 40.20 points or 0.38% after trading in a range of 10635.25 and 10685.15. There were 40 stocks advancing against 10 stocks declining on the index.

The top gainers on Nifty were Bharti Airtel up by 2.76%, Bharti Infratel up by 2.30%, Titan Company up by 1.77%, Bajaj Finance up by 1.71% and Mahindra & Mahindra was up by 1.53%. On the flip side, TCS down by 1.41%, Infosys down by 1.34%, NTPC down by 0.62%, Wipro down by 0.60% and Adani Ports & SEZ was down by 0.39% were the top losers.

Asian markets were trading mostly in green, Hang Seng increased 21.64 points or 0.08% to 28,368.65, Jakarta Composite soared 17.68 points or 0.27% to 6,515.50, Nikkei 225 surged 14.38 points or 0.07% to 21,296.23, Taiwan Weighted strengthened 15.35 points or 0.15% to 10,160.63, Shanghai Composite gained 6.86 points or 0.25% to 2,761.22 and Straits Times was up by 3.85 points or 0.12% to 3,269.82. On the other side, KOSPI was down by 3.29 points or 0.15% to 2,207.60.
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