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Key indices end marginally higher after volatile trade

Indian benchmark indices ended marginally higher after a volatile trade on Tuesday led by gains in Healthcare, Industrials and Basic Materials stocks. After making cautious start, benchmark indices traded higher with gains of over half a percent in morning deals, as sentiments got boost with data showing that India has attracted record total FDI inflow for the first ten months of a financial year in 2020-21. Accordingly, the inflow rose to $72.12 billion during April to January, 2021, 15 per cent higher as compared to the first ten months of 2019-20, when it stood at $62.72 billion. The FDI equity inflow grew by 28 per cent in the first ten months of FY 2020-21 ($54.18 billion) compared to the year ago period ($42.34 billion). Some support also came in as the country witnesses a rapid resurgence of coronavirus cases, a Finance Ministry report has exuded confidence in the Indian economy and termed the economic recovery as resilient citing improvement in high frequency indicators. The Monthly Economic Review for March 2021 released by the Department of Economic Affairs (DEA) said that the agricultural sector remains the bright spot of Indian economy with foodgrains production touching 303.3 million tonnes in 2020-21 beating record production levels for the fifth consecutive year in a row.

However, key gauges were unable to sustain most of the gains by the end of the trade, as traders remine concerned with Care Ratings’ statement that Maharashtra’s radical lockdown move will have an economic impact of Rs 40,000 crore, with the trade, hotels and transport sector to bear the biggest dent. The rating agency said the loss of economic activity will have a 0.32 per cent impact on the gross value added (GVA) growth at the national level. It revised down its national GDP growth estimate to 10.7 - 10.9 per cent from the 11 - 11.2 per cent given a week ago. Some concern also came with ICRA Ratings’ report stated that as the impact of various relief measures, including a moratorium on loan repayment and asset classification standstill wanes off, gross non-performing assets of banks may likely rise to 9.6-9.7 per cent by March 31, 2021.

On the global front, European markets were trading higher as investors looked past the region's slow pace of vaccinations to focus on signs of a robust U.S. economic recover. Besides, survey data from Sentix showed Eurozone investor confidence reached its strongest level in more than two years in April as lockdowns in many euro area countries had little effect on the overall economic recovery. The investor confidence index rose sharply to 13.1 in April from 5.0 in March. This was the highest level since August 2018 and well above economists' forecast of 7.5. Asian markets ended mostly lower on Tuesday as worried about rising coronavirus cases and extension of lockdown restrictions offset signs of the U.S. economy accelerating out of recession.

Back home, on the sectoral front, stocks related to sugar sector were in focus as the National Federation of Cooperative Sugar Factories (NFCSF) demanded that the government give more time to clear the unsold sugar quota as sales have been hit due to the pandemic. It said mills are also finding it difficult to sell sugar at a government-fixed rate of Rs 31 per kg. Fertiliser stocks too were buzzing as credit rating agency ICRA in its latest report has revised its outlook for the fertiliser sector to positive amid expectations of healthy profitability in 2021-22, following a normal monsoon for the upcoming kharif season.

Finally, the BSE Sensex rose 42.07 points or 0.09% to 49,201.39, while the CNX Nifty was up by 45.70 points or 0.31% to 14,683.50.  

The BSE Sensex touched high and low of 49,582.26 and 48,936.35, respectively. There were 15 stocks advancing against 14 stocks declining, while 1 stock remain unchanged on the index.

The broader indices ended in green; the BSE Mid cap index rose 1.00%, while Small cap index was up by 0.84%.

The top gaining sectoral indices on the BSE were Healthcare up by 1.65%, Industrials up by 1.60%, Basic Materials up by 1.05%, FMCG up by 0.99%, Realty up by 0.97% while, Bankex down by 0.51%, PSU down by 0.24%, Consumer Durables down by 0.22%, Utilities down by 0.21%, Energy down by 0.20% were the top losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 4.07%, Sun Pharma Industries up by 1.88%, Hindustan Unilever up by 1.44%, Dr. Reddys Lab up by 1.35% and HDFC up by 1.10%. On the flip side, Power Grid Corporation down by 2.29%, Axis Bank down by 1.12%, Indusind Bank down by 1.09%, Ultratech Cement down by 0.93% and ICICI Bank down by 0.91% were the top losers.

Meanwhile, the Commerce and Industry Ministry in its latest data has showed that foreign direct investment (FDI) equity inflows into the country grew by 28 percent to $54.18 billion during April-January 2020-21. FDI inflows stood at $42.34 billion during April-January 2019-20.

Total FDI (which includes reinvested earnings) during the 10-month period in FY21 increased by 15 percent to $72.12 billion over the year-ago period. The measures taken by the government on the fronts of FDI policy reforms, investment facilitation and ease of doing business have resulted in increased FDI inflows into the country.

Computer software and hardware has emerged as the top sector during the first ten months of 2020-21 with 45.81 per cent of the total inflows. It was followed by construction (infrastructure) activities (13.37 per cent) and services sector (7.80 per cent) respectively. These trends in India's FDI are an endorsement of its status as a preferred investment destination amongst global investors.

The CNX Nifty traded in a range of 14,779.10 and 14,573.90. There were 31 stocks advancing against 18 stock declining, while 1 stock remain unchanged on the index.    

The top gainers on Nifty were Adani Ports &Special up by 14.50%, Tata Consumer Products up by 4.66%, Asian Paints up by 3.96%, JSW Steel up by 3.77% and SBI Life Insurance up by 3.26%. On the flip side, Power Grid down by 2.03%, Grasim Industries down by 1.34%, Eicher Motors down by 1.08%, Axis Bank down by 0.91% and Ultratech Cement down by 0.82% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 76.46 points or 1.13% to 6,813.76, France’s CAC rose 37.42 points or 0.61% to 6,140.38 and Germany’s DAX was up by 154.09 points or 1.02% to 15,261.26.

Asian markets ended mostly lower on Tuesday as worries about rising coronavirus cases and extension of lockdown restrictions offset signs of the US economy accelerating out of recession. Chinese market ended in red after the country's central bank asked the nation's major lenders to curtail loan growth for the rest of this year to bring the housing boom under control. Hong Kong was closed for a holiday. Japanese market ended lower on profit taking, after three days of gains, as data showed household spending plunged 6.6 percent year-on-year in February, marking the third consecutive monthly drop.

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