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Key indices keep head above water in noon deals
May-24-2022

Indian stock markets continued to trade in positive terrain in the noon session due to buying in banking and auto stocks. Traders took some solace as India and US signed an Investment Incentive Agreement (IIA) at Tokyo. It is a legal requirement for continuing US investment support. The pact would activate proposals worth $4 billion that are under consideration by the US International Development Finance Corporation (DFC). Meanwhile, US President Joe Biden on Tuesday told Prime Minister Narendra Modi that he is committed to making America's partnership with India among the closest on earth, saying there is so much that the two countries can and will do together. However, upside remain capped as ICRA Ratings said the economic growth may have slowed to 3.5 per cent in fourth quarter of 2021-22 from 5.4 per cent in the previous three-month period due to the impact of higher commodity prices on margins, decline in wheat yields and on higher base.

On the global front, Asian markets were trading mostly in red on concerns over the impact of China’s Covid restrictions on the world’s second-largest economy as investment banks slashed their forecasts. Back home, shares of Delhivery and Venus Pipes and Tubes listed at the bourses today; Delhivery made tepid debut with 1% premium on the BSE, while Venus Pipes & Tubes lists with 2.76% premium on the BSE.

The BSE Sensex is currently trading at 54343.72, up by 55.11 points or 0.10% after trading in a range of 54021.27 and 54463.13. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 0.66%, while Small cap index was down by 0.45%.

The only gaining sectoral indices on the BSE were Bankex up by 0.49% and Auto was up by 0.01%, while Healthcare down by 1.00%, IT down by 0.96%, TECK down by 0.89%, Realty down by 0.78%, Capital Goods down by 0.76% were the losing indices on BSE.

The top gainers on the Sensex were Dr. Reddy's Lab up by 1.90%, HDFC up by 1.80%, Kotak Mahindra Bank up by 1.28%, Power Grid up by 1.27% and Nestle was up by 1.17%. On the flip side, Hindustan Unilever down by 2.49%, Tech Mahindra down by 2.17%, HCL Tech down by 1.84%, Bajaj Finserv down by 1.44% and Infosys was down by 1.40% were the top losers.

Meanwhile, Engineering Export Promotion Council (EEPC) has said that steel product prices -- which were continuously rising in the domestic market -- are expected to fall by 10-15 per cent due to duty-related measures taken by the government. Reacting to the government's move to levy export duty on some steel items, EEPC India Chairman Mahesh Desai said engineering goods manufacturers and exporters would benefit from the move and become more competitive in the global markets.

Desai said downstream exporters feel primary steel products prices will fall by 10 per cent for primary producers and 15 per cent for secondary steel producers. He said 'the government's decision to remove import duty on raw materials for steel would lower the cost for the domestic steel industry and therefore lower the prices...(and) increase/imposition of export duty on iron ores and a host of steel intermediaries would increase the domestic availability of the key industry inputs'. He also said the reduction in auto fuel prices would ease logistics costs, which have been hurting the sector for quite some time. He added that all the steps together would not only help the industry beat the surging input costs but also improve liquidity.

The government announced waiving of customs duty on the import of some raw materials, including coking coal and ferronickel, used by the steel industry. Also, the duty on exports of iron ore was hiked by up to 50 per cent and a few steel intermediaries to 15 per cent.

The CNX Nifty is currently trading at 16221.15, up by 6.45 points or 0.04% after trading in a range of 16117.10 and 16262.80. There were 16 stocks advancing against 33 stocks declining on the index.

The top gainers on Nifty were Dr. Reddy's Lab up by 1.88%, HDFC up by 1.86%, Kotak Mahindra Bank up by 1.51%, Power Grid Corp up by 1.29% and Nestle was up by 1.21%. On the flip side, Divi's Lab down by 5.31%, Grasim Industries down by 4.10%, ONGC down by 2.64%, Hindustan Unilever down by 2.22% and Tech Mahindra was down by 2.06% were the top losers.

Asian markets were trading mostly in red, Hang Seng decreased 335.07 points or 1.64% to 20,134.99, Straits Times trembled 3.45 points or 0.11% to 3,210.20, Shanghai Composite declined 42.16 points or 1.34% to 3,104.70, Nikkei 225 slipped 253.38 points or 0.94% to 26,748.14, Taiwan Weighted dropped 192.78 points or 1.19% to 15,963.63 and KOSPI was down by 41.50 points or 1.57% to 2,605.88.

On the other hand, Jakarta Composite was up by 74.19 points or 1.08% to 6,914.97.
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