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Extending previous session’s jubilation, Indian equity benchmarks ended the Wednesday’s trade with a gain of over a percent with frontline gauges recapturing their crucial 56,900 (Sensex) and 16,950 (Nifty) levels amid a positive rebound in the global market. Markets started the session on an optimistic note as traders took encouragement with the Finance Ministry’s report stating that the government has initiated various measures to provide relief and financial support to various sectors of the Covid-19 hit economy, at the same time, fiscal consolidation is also under focus. Traders also took note of newly-elected president of Federation of Indian Chambers of Commerce and Industry (Ficci) Sanjiv Mehta’s statement that high inflation has impacted consumption and market volumes have gone down, especially in the rural economy, but it is likely to start easing from mid-2022 as it is largely due to supply side constraints or speculation.

However, gains remained capped as traders remained watchful with report showing that India's production of crude oil, which is refined to produce petrol and diesel, continued to decline in November, with lower output from state-owned firms leading to an over 2 per cent drop. Crude oil production in November was 2.43 million tonnes, down from 2.48 million tonnes a year back and 2.5 million tonnes in October 2021. Key gauges added some more gains in last leg of trade as traders took support with the ratings agency ICRA’s statement that domestic IT services companies are expected to log a dollar revenue growth of 9-12 per cent in FY2022, driven by accelerated demand for digital technologies from enterprises globally and partly on account of low base of last year due to the COVID-19 impact. Meanwhile, the GST Council has not recommended bringing petroleum products under the reformed taxation regime even as certain representations have been made to the government to include petrol and diesel in GST.

Positive trade in European markets too aided sentiments with most of the European counters were trading in green. Though, gains remain capped as traders continued to weigh up coronavirus restrictions, infection rates and the effects on the economy. Asian markets ended the Wednesday’s trade mostly in green terrain, after Members of the Bank of Japan's Monetary Policy Board said that the country's economy is trending in a positive direction but remains at risk due to Covid-19 and its variants, minutes from the bank's meeting on October 27 and 28 revealed on Wednesday.

Back home, IT and auto stocks remained in limelight as the Government notified the semiconductor policy which was cleared by the Cabinet last week. According to the gazette notification, the government will provide up to 50% of project cost for two semiconductor and two display fabs in the country. Stocks related to gem and jewellery industry remained in focus as the Gem and Jewellery Export Promotion Council (GJEPC) said India’s overall gem and jewellery exports in November declined by 4.21 per cent to Rs 17,784.92 crore (USD 2,384 million) compared to the same month last year due to break in manufacturing activity during Diwali.

Finally, the BSE Sensex gained 611.55 points or 1.09% to 56,930.56 and the CNX Nifty was up by 184.60 points or 1.10% to 16,955.45.       

The BSE Sensex touched high and low of 56,989.01 and 56,471.03, respectively and there were 25 stocks advancing against 5 stocks declining on the index.  

The broader indices ended in green; the BSE Mid cap index surged 1.47%, while Small cap index up by 1.66%.

The top gaining sectoral indices on the BSE were Realty up by 2.93%, Industrials up by 2.04%, Energy up by 2.02%, Capital Goods up by 2.01% and Auto was up by 1.90%, while there were no losers on the BSE sectoral front.

The top gainers on the Sensex were Bajaj Finance up by 2.94%, Bharti Airtel up by 2.67%, Sun Pharma up by 2.42%, Reliance Industries up by 2.42% and SBI up by 2.23%. On the flip side, Power Grid Corporation down by 2.47%, Wipro down by 0.77%, ITC down by 0.24%, Nestle down by 0.17% and HDFC down by 0.00% were the top losers.

Meanwhile, the Finance Ministry in its report said that the government has initiated various measures to provide relief and financial support to various sectors of the Covid-19 hit economy, at the same time, fiscal consolidation is also under focus. It stated that increasing the buoyancy of tax revenue through improved compliance, mobilisation of resources through monetisation of assets, improving efficiency and effectiveness of public expenditure etc.

According to it on half yearly review of the trends in receipts and expenditure in relation to the budget at the end of the first half of the financial year 2021-22, Gross Tax Revenue (GTR) at the end of September 2021 was Rs 11,83,808 crore. This was 53.4 per cent of BE 2021-22 of Rs 22,17,059 crore and reflects an increase of Rs 4,62,912 crore (64.21 per cent) over GTR for Rs 7,20,896 crore in the corresponding period of previous year.

The Budget has projected fiscal deficit of 6.8 per cent of gross domestic product (GDP) for the current fiscal ending in March 2022. Besides, it mentioned Fiscal deficit has been estimated at Rs 15,06,812 crore which is 6.8 per cent of projected GDP (Rs 2,22,87,379 crore). The fiscal deficit of Rs 5,26,851 crore in H1, 2021-22 was about 35 per cent of BE. 

The CNX Nifty traded in a range of 16,819.50 and 16,971.00 and there was 41 stocks advancing against 9 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 4.02%, Tata Motors up by 3.73%, Divi's Lab up by 3.58%, Bajaj Finance up by 2.94% and Eicher Motors up by 2.90%. On the flip side, Power Grid Corporation down by 2.44%, SBI Life Insurance down by 0.96%, Wipro down by 0.75%, Indian Oil Corporation down by 0.41% and Adani Ports down by 0.38% were the top losers.

European markets were trading mostly in green; Germany’s DAX rose 31.22 points or 0.20% to 15,478.66 and UK’s FTSE 100 was up by 18.49 points or 0.27% to 6,983.48, while France’s CAC was down by 3.62 points or 0.05% to 7,293.79.

Asian markets ended the Wednesday’s trade mostly in green terrain after Wall Street’s main indexes ended sharply higher overnight, led by gains in tech and travel shares. Sentiment remained somewhat supported after U.S. President Biden said it is still possible to reach a deal with Senator Joe Manchin to push the $2 trillion Build Back Better bill through Congress. However, upside remain capped as a jump in coronavirus cases globally threatened economic activity, just days before Christmas and New Year holidays. Chinese shares ended marginally lower despite an assurance from a senior state planner to keep growth stable in the world's second largest economy. Hong Kong’s Hang Seng index rose half a percent as Chinese tech stocks staged a muted rebound.

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