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The local equity markets have pared some of their gains but are still trading in positive terrain in noon session. Both Sensex and Nifty were trading above the crucial 49,100 and 14,750 levels, respectively. Some support came as Finance Ministry released the second monthly installment of revenue deficit grant of Rs 9,871 crore to 17 states. With the release of the second installment, a total amount of Rs 19,742 crore has been released in the first two months of the current financial year as Post Devolution Revenue Deficit Grant to the states. However, markets trimmed some of their gains as Fitch Solutions states that India is likely to breach its fiscal deficit target in the financial year to March 2022 mainly due to revenue shortfall. The government is targeting a deficit between revenue it earns and what it spends at 6.8 per cent of the gross domestic product (GDP) in FY22 (April 2021 to March 2022). Meanwhile, foreign portfolio investors (FPIs) bought shares worth Rs 1,222.58 crore, while domestic institutional investors (DIIs)were net sellers to the tune of Rs 632.51 crore in the Indian equity market on 6 May, provisional data showed.

On the global front, Asian markets were trading mixed as traders keenly await a key US jobs report that is expected to reaffirm the recovery in the world's top economy is blasting ahead. Back home, in scrip specific developments, Blue Star surged on reporting 7-fold jump in Q4 consolidated net profit and Muthoot Finance gained on collaborating with fintech NIRA.

The BSE Sensex is currently trading at 49123.63, up by 173.87 points or 0.36% after trading in a range of 49093.05 and 49417.64. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.02%, while Small cap index was up by 0.31%.

The gaining sectoral indices on the BSE were Metal up by 3.69%, Basic Materials up by 1.74%, Telecom up by 1.05%, Realty up by 0.99% and Utilities was up by 0.89%, while IT down by 0.27%, Auto down by 0.10%, Oil & Gas down by 0.09% and TECK was down by 0.06% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 1.91%, Mahindra & Mahindra up by 1.82%, NTPC up by 1.75%, Ultratech Cement up by 1.72% and ITC was up by 1.60%. On the flip side, Bajaj Auto down by 1.66%, Infosys down by 0.71%, ICICI Bank down by 0.52%, Bajaj Finance down by 0.48% and Kotak Mahindra Bank was down by 0.38% were the top losers.

Meanwhile, Finance Ministry has released the second monthly instalment of revenue deficit grant of Rs 9,871 crore to 17 states. With the release of the second instalment, a total amount of Rs 19,742 crore has been released in the first two months of the current financial year as Post Devolution Revenue Deficit Grant to the states. The Centre provides the Post Devolution Revenue Deficit Grant to the states under Article 275 of the Constitution.

The grants are released as per the recommendations of the Finance Commission in monthly instalments to meet the gap in revenue accounts of the states post-devolution. The Department of Expenditure, Ministry of Finance has released the 2nd monthly instalment of Post Devolution Revenue Deficit (PDRD) Grant of Rs 9,871 crore for the year 2021-22 to 17 States. The 15th Finance Commission has recommended Post Devolution Release Deficit grants to 17 states based on the gap between the assessment of revenue and expenditure of the state.

The states recommended for Post Devolution Revenue Deficit Grant are: Andhra Pradesh, Assam, Haryana, Himachal Pradesh, Karnataka, Kerala, Manipur, Meghalaya, Mizoram, Nagaland, Punjab, Rajasthan, Sikkim, Tamil Nadu, Tripura, Uttarakhand and West Ben gal. The 15th Finance Commission has recommended a total Post Devolution Revenue Deficit Grant of Rs 1,18,452 crore to 17 States in the financial year 2021-22. The grant is released to the states in 12 monthly instalments.

The CNX Nifty is currently trading at 14788.25, up by 63.45 points or 0.43% after trading in a range of 14776.45 and 14863.05. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 6.41%, Adani Ports up by 2.83%, SBI Life Insurance up by 2.57%, JSW Steel up by 2.22% and Hindalco was up by 2.05%. On the flip side, Tata Consumer Products down by 4.10%, Hero MotoCorp down by 2.51%, Bajaj Auto down by 1.68%, Eicher Motors down by 1.28% and Infosys was down by 0.78% were the top losers.

Asian markets were trading mixed; Nikkei 225 surged 26.45 points or 0.09% to 29,357.82, Taiwan Weighted strengthened 290.64 points or 1.71% to 17,285.00, Straits Times advanced 22.90 points or 0.72% to 3,195.90 and KOSPI was up by 18.46 points or 0.58% to 3,197.20.

On the other side; Shanghai Composite declined 20.52 points or 0.6% to 3,420.76, Hang Seng decreased 5.42 points or 0.02% to 28,632.04 and Jakarta Composite was down by 21.10 points or 0.35% to 5,949.14.

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