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Indian equity benchmarks closed on a positive note with both the indices at record closing highs on Monday, as investor sentiment was lifted after some states eased lockdowns and daily COVID-19 cases in the country hit a two-month low. Markets started the week on an optimistic note and traded with positive bias throughout the day, as traders took encouragement with data showing that GST tax collections remained above Rs 1 lakh crore mark for the eighth straight month in May, indicating that the impact of the devastating second wave of Covid infections on the economy may have been limited. Sentiments remained positive with NITI Aayog Vice-Chairman -- Rajiv Kumar stating that he is confident that every organisation will revise their growth projections to 10-10.5 per cent once they witness the growth rate by October. He said the recovery will start from June itself and will get pace from July. He is hopeful that pandemic will not have much impact on fiscal deficit and disinvestment targets

Equity markets extended gains in late afternoon session, taking support from Labour Minister Santosh Gangwar’s statement that India is committed to making all possible efforts to counter the impact of the pandemic and emerge stronger. He also said governments are required to deal with the pandemic and provide an effective response at policy levels, to balance business continuity, income security and above everything, the well-being of all. Traders were positive, amid reports that India is likely to benefit from the global minimum 15 percent corporate tax rate pact inked by the world's richest nations as the effective domestic tax rate is above the threshold, and the country would continue to attract investment. Meanwhile, with an aim to provide taxpayer convenience and a modern, seamless experience to taxpayers, the Income Tax Department is launching its new e-filing portal on June 7, 2021.This is another initiative by CBDT towards providing ease of compliance to its taxpayers and other stakeholders.

On the global front, Asian market ended mostly higher on Monday, while European markets were trading higher, following the broadly positive cues from Wall Street as weak jobs data eased inflation concerns and prospects of additional fiscal stimulus, while COVID-19 infection concerns in several markets in the region kept the underlying mood cautious. Back home, on the sectoral front, banking stocks were in focus as RBI data showed bank credit grew by 5.98 percent to Rs 108.33 lakh crore while deposits rose by 9.66 percent to Rs 151.67 lakh crore in the fortnight ended May 21, 2021. There was some reaction in MSME stocks as Union minister Nitin Gadkari stressed on increasing the share of the MSME sector in the country's GDP to 40 per cent from 30 per cent currently. Gadkari said the world is now favouring India instead of China.

Finally, the BSE Sensex rose 228.46 points or 0.44% to 52,328.51, while the CNX Nifty was up by 81.40 points or 0.52% to 15,751.65.    

The BSE Sensex touched high and low of 52,378.69 and 52,054.76, respectively and there were 21 stocks advancing against 9 stocks declining on the index.       

The broader indices ended in green; the BSE Mid cap index rose 0.78%, while Small cap index was up by 1.38%.

The top gaining sectoral indices on the BSE were Utilities up by 3.33%, Power up by 2.66%, Telecom up by 1.49%, Energy up by 1.44%, Oil & Gas up by 1.23% while, Realty down by 0.44% and Finance down by 0.08% were the losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 4.44%, NTPC up by 4.07%, Ultratech Cement up by 2.78%, Reliance Industries up by 1.68% and Indusind Bank up by 1.57%. On the flip side, Bajaj Finance down by 4.43%, Bajaj Finserv down by 2.67%, HDFC down by 1.33%, Dr. Reddys Lab down by 0.66% and SBI down by 0.28% were the top losers.

Meanwhile, after the second wave of Covid-19 pandemic had hit the country hard, which led the Reserve Bank of India (RBI) reduce its Gross Domestic Product (GDP) growth projection by 1 per cent in the current financial year (FY22), NITI Aayog Vice-Chairman -- Rajiv Kumar has said he is confident that every organisation will revise their growth projections to 10-10.5 per cent once they witness the growth rate by October. He said everyone will revise their growth projections once Indian economy will start recovering. The recovery will start from June itself and will get pace from July. He said ‘RBI has cuts GDP growth forecast for the financial year 2021-22 to 9.5 per cent from 10.5 per cent due to impact of the second wave, which is going to impact our economy in the first quarter. The economy will recover below than expected in the first quarter. Our economy will grow at a pace of 10 per cent-10.5 per cent in the financial year 2021-22.’

He is hopeful that pandemic will not have much impact on fiscal deficit and disinvestment targets. Further he mentioned ‘Covid-19 has forced the government to invest more, spend more on public infrastructure, but it will not have much impact as we have seen our GST collection has increased. In the budget also our revenue target were kept very conservative. So I think we will not have to worry much about our fiscal deficit target. If we see the data of the International Monetary Fund (IMF) which stated that fiscal deficit target globally is on an average of around 9.8 per cent. Our fiscal deficit is not more than others. I am confident that we will achieve our disinvestment target.’

Talking about the possibility of a third wave after a disastrous second wave created havoc in the country, Kumar said hope for the best, prepare for the worst. He stated ‘We are fully prepared for the third wave. Our health infrastructure is much better than earlier. If by any chance a third wave strikes, it will not impact as much as I have seen. People are not careless now. They are taking full precautions and are getting vaccinated also. Thus, I believe that a third wave will not make much impact.’

The CNX Nifty traded in a range of 15,773.45 and 15,678.10 and there were 33 stocks advancing against 17 stocks declining on the index.      

The top gainers on Nifty were Adani Ports up by 5.28%, Power Grid up by 5.00%, NTPC up by 4.21%, Tata Motors up by 2.81% and Ultratech Cement up by 2.58%. On the flip side, Bajaj Finance down by 4.46%, Bajaj Finserv down by 2.94%, HDFC down by 1.23%, Divis Lab down by 0.81% and Cipla down by 0.78% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 18.75 points or 0.27% to 7,087.79, France’s CAC increased 12.88 points or 0.2% to 6,528.54 and Germany’s DAX increased 25.90 points or 0.17% to 15,718.80.

Asian market ended mostly higher on Monday amid a weaker-than-expected US monthly jobs report calmed investor concerns about inflation and potential tightening of monetary policies by central banks. Reports showed that non-farm payroll employment jumped by 559,000 jobs in May after climbing by an upwardly revised 278,000 jobs in April, but was slightly worse than street’ expectations of about 650,000 employment gains. While, the unemployment rate fell to 5.8 percent in May from 6.1 percent in April. Chinese shares rose, even as disappointing Chinese trade data weighed on market sentiments. Chinese trade data showed that China’s exports grew 27.9 percent in May compared to the previous year and imports grew 51.1 percent last month, but both missed expectations.

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