Indices end at record closing peaks; Nifty settles above 13,050 level
Continuing their gaining streak, Indian equity benchmarks ended at a record close on Tuesday with Nifty crossing the 13,050-mark for the first time ever, following advances in global peers largely because signs of progress on a COVID-19 vaccine which in turn spurred hopes for a faster economic recovery. Benchmarks made optimistic start and traded in fine fettle, as sentiments got a boost as Finance Minister Nirmala Sitharaman assured the industry that momentum of economic reforms will continue to make India a hotspot of global investment. Some positivity also came as Care Ratings said the economy is expected to throw up better numbers in the September quarter with GDP contraction of 9.9 per cent, as against 24 per cent in Q1 at the onset of the pandemic.
Frontline gauges extended their upside in second half of trading session, as sentiment perked up with chief economic adviser (CEA) -- Krishnamurthy Subramanian’s statement that India is likely to report a current account surplus at the end of the current financial year ending in March 2021, mainly led by a fall in imports. Adding optimism among investors, Niti Aayog CEO Amitabh Kant said that unprecedented reforms undertaken on both governance and economic fronts by the government will usher in a new era of growth and prosperity. He also stressed the need to increase expenditure on research and development and strengthen intellectual property rights (IPR) laws. Traders overlooked S&P Global Ratings’ statement that the recommendations made by the Reserve Bank of India's (RBI) working group on allowing corporate ownership in banks given India's weak corporate governance amid large corporate defaults over the past few years pose a potential risk.
On the global front, Asian markets ended mostly higher on Tuesday as investors cheered more positive results from coronavirus vaccine trails and the administrator of the General Services Administration formally designated Joe Biden as the apparent winner of the U.S. presidential election. Biden has chosen former Federal Reserve Chair Janet Yellen as treasury secretary, adding to the positive sentiment. Besides, the latest survey from the Bank of Korea showed consumer confidence in South Korea strengthened in November, with a Composite Consumer Sentiment Index score of 97.9 - up from 91.6 in October. European markets were trading higher, as revised data from Destatis revealed that the German economy rebounded at a faster than expected pace in the third quarter, offsetting a large part of the massive contraction in the second quarter. GDP grew 8.5 percent sequentially in the third quarter, reversing the 9.8 percent decline in the second quarter caused by the coronavirus pandemic, following the relaxation of Covid-19 restrictions.
Finally, the BSE Sensex rose 445.87 points or 1.01% to 44,523.02, while the CNX Nifty was up by 128.70 points or 1.00% to 13,055.15.
The BSE Sensex touched high and low of 44,601.63 and 44,247.12, respectively and there were 22 stocks advancing against 8 stocks declining on the index.
The broader indices ended in green; the BSE Mid cap index rose 0.58%, while Small cap index was up by 0.89%.
The top gaining sectoral indices on the BSE were Bankex up by 2.37%, Auto up by 1.84%, Realty up by 1.78%, Finance up by 1.43% and Metal up by 1.37%, while Telecom down by 0.23% was the lone losing index on BSE.
The top gainers on the Sensex were Axis Bank up by 4.02%, Mahindra & Mahindra up by 3.47%, HDFC Bank up by 3.14%, ITC up by 2.44% and SBI up by 2.16%. On the flip side, HDFC down by 1.47%, Titan Company down by 1.36%, Nestle down by 0.63%, Bharti Airtel down by 0.61% and ONGC down by 0.59% were the top losers.
Meanwhile, Niti Aayog CEO Amitabh Kant has said that unprecedented reforms undertaken on both governance and economic fronts by the government will usher in a new era of growth and prosperity. He also stressed the need to increase expenditure on research and development and strengthen intellectual property rights (IPR) laws.
Referring to the reforms undertaken by the government in recent times, Kant said as the world battles contraction in economic growth, India has initiated reforms in key sectors including agriculture, labour and mining. He noted that labour reforms will help in making India a manufacturing hub and the country has also successfully improved its ranking in Global Innovation Index. He also pointed out that despite challenges at the global level, foreign direct investment (FDI) in India increased from $36 billion in 2013-14 to $74 billion in 2019-20.
Noting that infrastructure will be a key driver of growth, Niti Aayog CEO said through the National Infrastructure Pipeline (NIP) which envisages $1.5 lakh crore of investments, 21 percent of those will come from the private sector. He stated that the project pipeline also has a high degree of readiness and 40 percent projects are already under implementation. He also said that asset monetisation will give robust long-term investment opportunities. Noting that European and American companies will look for alternatives owing to the US-China trade war, he said India can and must turn this crisis into an opportunity.
The CNX Nifty traded in a range of 13,079.10 and 12,978.00 and there were 38 stocks advancing against 12 stocks declining on the index.
The top gainers on Nifty were Adani Ports & SEZ up by 4.46%, Axis Bank up by 3.93%, HDFC Bank up by 3.54%, Eicher Motors up by 3.52% and Hindalco up by 3.44%. On the flip side, Titan Company down by 1.45%, HDFC down by 1.37%, BPCL down by 1.17%, Nestle down by 0.85% and GAIL down by 0.79%.
European markets were trading higher; UK’s FTSE 100 increased 60.92 points or 0.96% to 6,394.76, France’s CAC increased 68.13 points or 1.24% to 5,560.28 and Germany’s DAX increased 113.42 points or 0.86% to 13,240.39.
Asian markets ended mostly higher on Tuesday on expectations of a global economic recovery amid progress in Covid-19 vaccine development, while a formal transition approval for US President-elect Joe Biden also lifted sentiment. AstraZeneca announced its vaccine candidate being developed in collaboration with Oxford University had an average efficacy of 70 percent. Japanese shares climbed as trading resumed after a long holiday weekend. Further, the Bank of Japan Governor Haruhiko Kuroda reiterated the central bank’s readiness to implement additional easing measures if needed, too supported market sentiment. Meanwhile, Consumer confidence in South Korea strengthened in November, the latest survey from the Bank of Korea showed with a Composite Consumer Sentiment Index score of 97.9 up from 91.6 in October. Though, Chinese shares declined after foreign policy specialists have said they expect Sino-US tensions to continue under the Biden presidency. A Chinese government advisor recently said that the US President-elect Joe Biden is certainly a very weak President and he could start a war with China.
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