Benchmarks continue to trade in green terrain

Indian equity benchmarks continued to trade in green terrain in afternoon session, on account of broad based buying in blue chip counters amid positive Asian cues. Among blue chip stocks, Sun Pharma was top gainer trading up by around 4%, while Hindustan Unilever was top loser down by 1.54%. Traders took support with report that the Reserve Bank of India (RBI) will purchase government securities under open market operations (OMOs) for an aggregate amount of Rs 10,000 crore on September 24, 2020. Some solace also came with report that the Employees' State Insurance Corporation (ESIC) subscribers who lost their job due to the COVID-19 situation can claim unemployment relief of 50 per cent of wages under the Atal Bimit Kalyan Yojana.

On the global front; Asian markets were trading mostly higher as US Federal Reserve decided to keep key its short-term interest rate near zero till the end of 2023 to stem the economy from damage caused by coronavirus pandemics. Back on street; in scrip specific developments; Escorts jumped as ICRA upgrades its long-term rating to ‘AA’, while HDFC Bank slipped as US law firm files class action suit against the bank for misleading claims.

The BSE Sensex is currently trading at 39059.79, up by 79.94 points or 0.21% after trading in a range of 38979.08 and 39200.42. There were 20 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.86%, while Small cap index was up by 0.56%.

The top gaining sectoral indices on the BSE were Healthcare up by 4.32%, Realty up by 3.34%, Telecom up by 1.20%, TECK up by 0.89% and Metal was up by 0.84%, while FMCG was down by 0.72% was the only losing index on BSE.

The top gainers on the Sensex were Sun Pharma up by 3.94%, Tech Mahindra up by 2.44%, HCL Tech up by 1.91%, Mahindra & Mahindra up by 1.46% and Bharti Airtel was up by 1.42%. On the flip side, Hindustan Unilever down by 1.54%, Bajaj Finserv down by 1.47%, Maruti Suzuki down by 0.96%, Kotak Mahindra Bank down by 0.93% and Nestle was down by 0.80% were the top losers.

Meanwhile; The Department for Promotion of Industry and Internal Trade (DPIIT) in a note has said that the government has permitted foreign direct investment (FDI) of up to 74 percent under automatic route in the defence sector in order to attracting overseas investors. However, it said foreign investments in the defence sector would be subject to scrutiny on the grounds of national security and the government reserves the right to review any foreign investment in the sector that affects or may affect national security.

As per the current FDI policy, 100 percent overseas investments are permitted in the defence industry -- 49 percent under the automatic route, while beyond that government approval was required. According to the note, FDI up to 74 percent under automatic route shall be permitted for companies seeking new industrial licences. It also said that infusion of fresh investment up to 49 percent, in a company not seeking industrial licence or which already has government approval for FDI in defence, shall require mandatory submission of a declaration with the defence ministry in case change in equity/shareholding pattern or transfer of stake by existing investor to new foreign investor for FDI up to 49 percent, within 30 days of such change.

It further said the proposal for raising FDI beyond 49 percent from such companies will require government approval. It added that the decision will take effect from the date of Foreign Exchange Management Act (FEMA) notification.

The CNX Nifty is currently trading at 11564.35, up by 48.25 points or 0.42% after trading in a range of 11537.55 and 11584.10. There were 35 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were Dr. Reddys Lab up by 8.72%, Cipla up by 7.45%, Sun Pharma up by 3.87%, Adani Ports & SEZ up by 2.79% and Hindalco was up by 2.59%. On the flip side, Hindustan Unilever down by 1.60%, Bajaj Finserv down by 1.53%, Shree Cement down by 1.18%, Maruti Suzuki down by 0.91% and Kotak Mahindra Bank was down by 0.85% were the top losers.

Asian markets were trading mostly in green; Hang Seng increased 142.50 points or 0.59% to 24,483.35, Shanghai Composite gained 60.11 points or 1.84% to 3,330.55, KOSPI rose 6.23 points or 0.26% to 2,412.40, Jakarta Composite soared 8.63 points or 0.17% to 5,047.03, Taiwan Weighted strengthened 2.88 points or 0.02% to 12,875.62 and Nikkei 225 was up by 40.93 points or 0.18% to 23,360.30.

On the flip side; Straits Times was down by 1.99 points or 0.08% to 2,498.79.

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