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Indices end at record closing high on Wednesday

Extending their winning streak to a third consecutive session, Indian equity benchmarks ended at record closing high with gains of around a percent each on Wednesday, as economic recovery hopes, on the back of growth-driven Budget, positive global cues, and healthy FII buying continued to please investors. Markets made cautious start but soon gained traction and traded in fine fettle, as traders took some encouragement with NITI Aayog Vice-Chairman Rajiv Kumar’s statement that the reform measures announced in the budget 2021-22 are aimed at taking India out of the COVID-19-induced downturn and making the country a better destination for private investment, both for domestic and foreign investors. Sentiments remained up-beat as the US-India Strategic and Partnership Forum (USISPF) described Union Budget as bold and visionary, which would launch India’s economy into a growth trajectory. It added that the budget positions India towards its target of a $5 trillion economy.

Markets were continuing their rally mood in the afternoon session, as India's services sector expanded for the fourth consecutive month in January as business activities quickened and rising business optimism is set to sustain the growth momentum. The seasonally-adjusted India Services Business Activity Index rose from 52.3 in December to 52.8 in January, pointing to a quicker expansion in output. The index was above the critical 50 mark that separates growth from contraction for the fourth month in a row during January. Additional support also came with trade Promotion Council of India's (TPCI's) Founder Chairman Mohit Singla’s statement that the country's exports, which have recorded a growth of 5.4 percent in January, reflects the trade has been on the path of quick recovery. He said the exports have also recorded positive growth in December 2020 and it is a reflection that Indian products have been sustaining its global demand despite challenges.

On the global front, Asian markets ended mostly in green, following the positive cues from Wall Street amid easing concerns about the retail trading frenzy. Upbeat corporate earnings results and optimism about more U.S. fiscal stimulus also lifted the markets. Besides, the latest survey from Markit Economics showed that the services sector in Australia continued to expand in January, albeit at a slower rate, with a services PMI score of 55.6. That's down from 57.0 in December, although it remains above the boom-or-bust line of 50 that separates expansion from contraction. The survey also showed that Markit's composite PMI slipped to 55.9 from 56.6 in December. However, the latest survey from Jibun Bank revealed that the services sector in Japan continued to contract in January, and at a faster pace, with a services PMI score of 46.1. That beat expectations for 45.7 and it down from 47.7 in December - so it moves further beneath the boom-or-bust line of 50 that separates expansion from contraction. The survey also showed that the composite index fell to 47.1 from 48.5 in December.  European markets were trading higher, amid expectations of a vaccine-powered strengthening of activity later in the year and additional policy support in a few large economies. Strong earnings from Alphabet and Amazon.com also boosted sentiment.

Finally, the BSE Sensex rose 458.03 points or 0.92% to 50,255.75, while the CNX Nifty was up by 142.10 points or 0.97% to 14,789.95.

The BSE Sensex touched high and low of 50,526.39 and 49,515.88, respectively and there were 23 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 1.38%, while Small cap index was up by 1.47%.

The top gaining sectoral indices on the BSE were Utilities up by 2.47%, Healthcare up by 2.40%, Power up by 2.34%, PSU up by 2.29%, Metal up by 1.56% while, Realty down by 0.46%, FMCG down by 0.03% were the only losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 7.65%, Power Grid up by 6.28%, Dr. Reddys Lab up by 3.71%, Sun Pharma up by 3.29% and NTPC up by 3.13%. On the flip side, Ultratech Cement down by 0.90%, Maruti Suzuki down by 0.89%, ITC down by 0.66%, Kotak Mahindra Bank down by 0.63% and Asian Paints down by 0.42% were the top losers.

Meanwhile, Niti Aayog Vice-Chairman Rajiv Kumar has said the reform measures announced in the budget 2021-22 are aimed at taking India out of the COVID-19-induced downturn and making the country a better destination for private investment, both for domestic and foreign investors.

Further, Kumar said he is confident that the government will cross the next fiscal year's disinvestment target of Rs 1.75 lakh crore. On disinvestment target of Rs 1.75 lakh crore for the next fiscal year, He said a lot of preparatory work has already been done in the last 8-9 months, and now market conditions have changed. He also stressed that reform measures announced in the Budget will help us achieve the target of $ 5 trillion economy.

Noting that for the first time, the finance minister has announced a real-time dashboard for monitoring the progress of asset monetisation and disinvestments, Kumar said, ‘So, there is focus on implementation this time.’ On the government's proposal to privatise two public sector banks and one general insurance company in 2021-22, he said all the necessary preparation has to be done which includes engaging with all the stakeholders.

The CNX Nifty traded in a range of 14,868.85 and 14,574.15 and there were 40 stocks advancing against 10 stocks declining on the index.

The top gainers on Nifty were Indusind Bank up by 7.29%, Power Grid up by 5.97%, Divis Lab up by 4.66%, Coal India up by 4.38% and Dr. Reddys Lab up by 3.98%. On the flip side, Shree Cement down by 1.64%, UPL down by 1.51%, Ultratech Cement down by 0.99%, Maruti Suzuki down by 0.91% and Grasim Industries down by 0.83% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 27.22 points or 0.42% to 6,543.87, France’s CAC rose 17.84 points or 0.32% to 5,580.95 and Germany’s DAX was up by 89.26 points or 0.65% to 13,924.42.

Asian markets ended mostly higher on Wednesday, lifted by the optimism over positive earnings results, US stimulus measures and on wider vaccine rollout. IT shares were the biggest gainers in the session. Optimism over quick economic recovery boosted the market sentiments. Japan's Nikkei marked third straight session gain, while China's Shanghai ended lower with the news that the country's manufacturing activity slipped in January.

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