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Benchmarks trade in fine-fettle in early deals on Wednesday
Feb-19-2020

After four days of declines, Indian equity benchmarks made a strong comeback with gap-up opening on Wednesday. The markets were trading in fine-fettle in early deals. Gains across all sectors pushed the markets higher, led by energy, healthcare and realty stocks. Sentiments got a boost with Finance Minister Nirmala Sitharaman’s statement that the government will soon announce measures to deal with the impact of Coronavirus outbreak on the domestic industry. Besides, Indian business leaders are demanding cuts in import duties on antibiotic drugs, mobile parts and other items as the outbreak of the coronavirus has disrupted supplies from China. Some support also came in with the Reserve Bank of India (RBI) Governor Shaktikanta Das’ statement that there is no reason to doubt that the government will be able to cut fiscal deficit to 3.5% of the GDP in the fiscal beginning April 1. Das said the Budget for 2020 had announcements that certain bonds will be opened up for non-resident investment without any limit.

Global cues also remained supportive with all the Asian markets trading higher as investors shrugged off worries about the impact of the coronavirus outbreak. While the cumulative death toll in China related to the coronavirus outbreak topped 2,000, new confirmed cases of coronavirus infections on the mainland has declined on Tuesday from a day earlier. Meanwhile, the Ministry of Finance said Japan posted a merchandise trade deficit of 1,312.6 billion yen in January. That beat estimates for a shortfall of 1,684.8 billion yen following the 154.6 billion yen deficit in December.

Back home, the commerce ministry said that exports from SEZs have crossed $100 billion mark by mid-February in the current financial year, surpassing the 2018-19 level. It added that the special economic zones (SEZ) continue to take lead in expanding the exports for the country. In stocks specific developments, Shree Cement gained amid reports that it will replace Yes Bank in the benchmark index Nifty 50 from 27 March 2020. Infosys was trading higher as the company announced a long-term strategic partnership with GE Appliance, a Haier company, to effectively streamline IT operations.

The BSE Sensex is currently trading at 41204.50, up by 310.12 points or 0.76% after trading in a range of 41119.66 and 41309.67. There were 28 stocks advancing against 2 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.78%, while Small cap index was up by 0.85%.

The top gaining sectoral indices on the BSE were Energy up by 1.72%, Healthcare up by 1.68%, Realty up by 1.43%, Telecom up by 1.28% and Power was up by 1.21%, while there were no losers on the BSE sectoral front.

The top gainers on the Sensex were NTPC up by 2.32%, Reliance Industries up by 1.86%, Nestle up by 1.70%, ONGC up by 1.41% and Axis Bank up by 1.18%. On the flip side, Indusind Bank down by 0.11% and Asian Paints down by 0.01% were the only losers.

Meanwhile, in order to deal with the impact of coronavirus outbreak on the domestic industry and exports, Finance Minister Nirmala Sitharaman has said that the government will soon announce measures regarding it. She added that these measures will be announced in consultation with the Prime Minister's Office (PMO). Describing pharma, chemical and solar equipment segments as worst affected, the finance minister said disruptions are very visible in these sectors due to delay in shipments.

Sitharaman also said that there are no concerns about price rise so far due to coronavirus and added that it is too early to talk about the impact of Covid-19 outbreak on the Make in India initiative. She said there were no reports of shortage of medicines or medical equipment, instead, the pharma industry is asking for the lifting of the ban on exports of certain items.

About the MSME sector, she said the representatives raised concern about the delay in payment which is affecting their repayment to banks. Some MSMEs have also said that if the cycle of receiving the goods, manufacturing and sending them out is getting affected, because of delayed or staggered raw material supply, banks will also have to understand that repayments will be taking their own time. She said so to that extent they wanted flexibility from the banks. So everything got linked with raw material supply, congestion at the ports.

The CNX Nifty is currently trading at 12085.60, up by 93.10 points or 0.78% after trading in a range of 12061.85 and 12118.90. There were 44 stocks advancing against 6 stocks declining on the index.

The top gainers on Nifty were Bharti Infratel up by 6.36%, Coal India up by 2.73%, NTPC up by 2.46%, Reliance Industries up by 1.82% and Grasim Industries up by 1.60%. On the flip side, Tata Motors down by 3.53%, Yes Bank down by 1.43%, Britannia Industries down by 0.67%, UPL down by 0.21% and Asian Paints down by 0.20% were the top losers.

All Asian markets are trading higher; Nikkei 225 surged 255.19 points or 1.1% to 23,448.99, Hang Seng increased 121.21 points or 0.44% to 27,651.41, Taiwan Weighted strengthened 112.08 points or 0.96% to 11,761.06, Jakarta Composite soared 27.60 points or 0.47% to 5,914.56, Straits Times advanced 22.49 points or 0.7% to 3,219.12, Shanghai Composite gained 9.10 points or 0.3% to 2,994.07and KOSPI was down by1.52 points or 0.07% to 2,210.40.
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