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Markets trade jubilantly in early deals; Nifty above 10,650 mark
Feb-20-2019

Indian equity markets made an optimistic start and are trading jubilantly in early deals on Wednesday, with frontline gauges gaining over 0.70%, as all the sectoral indices are trading higher, led by Metal, Basic Materials and Oil & Gas. Sentiment remained upbeat with Care Ratings’ report that signalling an end to the liquidity crisis that NBFCs have been facing since last September, corporate bond issuances by them have risen by 30% in January, reflecting renewed confidence among both issuers as well as investors. Traders took encouragement with the government's statement that the revised Gross Domestic Product (GDP) figures for the demonetisation year was not cooked up and, in fact, the growth rates are likely to go up further due to the GST. On January 31, the government revised the GDP growth rates by 110 basis points (bps) from 7.1% to 8.2% for 2016-17, the year of demonetisation, and by 50 bps from 6.7% to 7.2% for fiscal 2017-18. Meanwhile, the Cabinet approved a new electronics policy which aims to create a $400 billion electronic manufacturing ecosystem by 2025 and generate 1 crore jobs in the country.

Global cues too remained supportive with Asian markets are trading mostly in green at this point of time following the gains on Wall Street after US President Donald Trump said the US-China trade talks are ‘going very well’ and once again hinted that an early March deadline to reach a deal could be postponed. Back home, the oil & gas sector stocks are trading higher after the government approved new rules for bidding out oil and gas blocks as it reverted back to a two-decade-old system of awarding areas based on exploration work commitment, granted marketing and pricing freedom to yet to be developed discoveries and allowed ONGC to induct private firms in existing fields.

The BSE Sensex is currently trading at 35608.07, up by 255.46 points or 0.72% after trading in a range of 35519.80 and 35653.14. There were 27 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.72%, while Small cap index was up by 0.75%.

The top gaining sectoral indices on the BSE were Metal up by 1.82%, Basic Materials up by 1.46%, Oil & Gas up by 1.37%, Energy up by 1.16%, Consumer Durables up by 1.12%, while there were no losers on BSE sectoral front.

The top gainers on the Sensex were Tata Steel up by 2.37%, Vedanta up by 2.22%, SBI up by 1.54%, Yes Bank up by 1.44% and ONGC was up by 1.37%. On the flip side, Bajaj Auto down by 1.10%, Hero MotoCorp down by 1.05%, HCL Tech down by 0.66% and Hindustan Unilever was down by 0.10% were the top losers.

Meanwhile, in order to incentivize compliance with law and to extend greater Ease of Doing Business, the Union Cabinet has given green signal to the promulgating an ordinance for companies law amendments. A bill to replace the Companies (Amendment) Ordinance, 2018, that was promulgated in November could not be passed during the last session of the current Parliament. Hence, the government has decided to promulgate the Companies (Second Amendment) Ordinance, 2019.

The amendments have been brought in to address the need to impose civil liability for technical and procedural defaults of a minor nature. Further, the changes have been made to plug gaps in the corporate governance and enforcement framework covering a wide range of issues. As many as 16 minor offences have been re-categorised as ‘purely civil defaults’ which would help de-clog special courts.

Besides, certain routine functions from the National Company Law Tribunal (NCLT) would be transferred to the central government. These include dealing with applications for change of financial year and conversion from public to private companies. A total of 29 sections were amended and two new sections were inserted through the earlier ordinances, which were promulgated on November 2, 2018 (Ordinance 9 of 2018) and on January 12, 2019 (Ordinance 3 of 2019).

The CNX Nifty is currently trading at 10684.35, up by 80.00 points or 0.75% after trading in a range of 10653.60 and 10697.35. There were 41 stocks advancing against 9 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing Finance up by 3.04%, Tata Steel up by 2.79%, Hindalco up by 2.52%, Vedanta up by 2.48% and BPCL was up by 2.40%. On the flip side, Bajaj Auto down by 1.12%, Bharti Infratel down by 0.89%, HCL Tech down by 0.77%, Hero MotoCorp down by 0.75% and Dr. Reddy’s Lab was down by 0.59% were the top losers.

Asian markets were trading mostly in green, Hang Seng increased 187.45 points or 0.66% to 28,415.58, Taiwan Weighted strengthened 76.67 points or 0.76% to 10,228.93, Nikkei 225 surged 72.54 points or 0.34% to 21,375.19, KOSPI rose 19.21 points or 0.87% to 2,224.84, Straits Times advanced 10.43 points or 0.32% to 3,270.23 and Jakarta Composite was up by 9.01 points or 0.14% to 6,503.68. On the other side, Shanghai Composite was down by 4.20 points or 0.15% to 2,751.45.
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