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Going from strength to strength, local equity markets have now escalated to day’s high point on sustained buying activities by funds and retail investors. Sentiments were upbeat with a private report stated that IT spending in the country is expected to grow at 8 per cent to $92.7 billion in 2021. The growth at 8 percent is a shade less than the world average of 8.6 per cent and global spends on information technology are estimated to come at $4.2 trillion. On the sectoral front, textile stocks were in limelight as garment exporters will continue to get a rebate on central and state taxes on their outward shipments as the government on Wednesday approved extension of RoSCTL scheme till March 2024. On the global front, Asian markets were trading mostly higher as economic data from China was largely more resilient than expected, and as US Federal Reserve chair Jerome Powell said tapering of its massive stimulus was still a way off.

Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too participated strongly in the rally. Currently, BSE Sensex is trading at 53238.84, up by 334.79 points or 0.63% after trading in a range of 52948.43 and 53239.43. There were 18 stocks advancing against 11 stocks declining, while 1 stock remains unchanged on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.24%, while Small cap index was up by 0.42%.

The gaining sectoral indices on the BSE were Capital Goods up by 2.12%, IT up by 1.47%, Industrials up by 1.04%, TECK up by 1.02% and Bankex was up by 0.73%, while Oil & Gas down by 0.69%, Auto down by 0.43%, Telecom down by 0.36%, PSU down by 0.25% and Energy was down by 0.25% were the top losing indices on BSE.

The top gainers on the Sensex were HCL Tech up by 4.54%, Larsen & Toubro up by 4.20%, Tech Mahindra up by 3.44%, HDFC Bank up by 1.68% and Ultratech Cement was up by 1.04%. On the flip side, Mahindra & Mahindra down by 0.65%, Asian Paints down by 0.56%, Maruti Suzuki down by 0.51%, Hindustan Unilever down by 0.45% and Sun Pharma was down by 0.41% were the top losers.

Meanwhile, auto industry body -- Society of Indian Automobile Manufacturers (SIAM) said rising fuel prices will have a negative impact on the automobile industry, hitting vehicle demand, while also adding to the overall inflationary pressure. It has also suggested to the government a fitness-based scrappage policy instead of policy based on demand stimulus. SIAM president Kenichi Ayukawa said ‘Unfortunately, with the fuel price going up we will be getting a negative impact in our industry. How long this kind of situation will continue we don't know but we expect the fuel prices to become reasonable as soon as possible’.

Ayukawa said ‘We have to carefully watch the demand in the market because automatically, (with) fuel prices going up people will hesitate to use vehicles. That is a big concern for us’. While stating that SIAM cannot predict how much sales drop there would be, he said ‘Historically, whenever there is a rise in fuel price there has been a slowdown in demand.’ He noted ‘we have to see how it is going’. Also, he agreed that with the rise in diesel prices transportation costs of goods will also increase and thus ‘accelerate inflation’.

Commenting on the scrappage policy that the government has announced in March this year, Ayukawa said the auto industry is suggesting giving importance to the fitness of vehicles. SIAM's view is that ‘the fitness of the vehicle is important for safety on the road and for the environment. Vehicles should be roadworthy’. Ayukaway further said ‘So we should have regular testing of in-use vehicles. If such vehicles are not found to be okay, these vehicles should be given sufficient opportunity to refurbish, if it is still not okay, then it should be scrapped. So the industry has suggested adoption of fitness-based scrappage policy instead of policy based on demand stimulus.’

The CNX Nifty is currently trading at 15940.15, up by 86.20 points or 0.54% after trading in a range of 15855.00 and 15941.20. There were 26 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were HCL Tech up by 4.58%, Larsen & Toubro up by 4.18%, Tech Mahindra up by 3.47%, Wipro up by 2.17% and HDFC Bank was up by 1.64%. On the flip side, ONGC down by 3.19%, Eicher Motors down by 1.48%, Coal India down by 1.25%, Britannia Industries down by 0.63% and Asian Paints was down by 0.60% were the top losers.

Asian markets were trading mostly higher, KOSPI rose 20.23 points or 0.62% to 3,285.04, Shanghai Composite gained 33.95 points or 0.96% to 3,562.45, Taiwan Weighted strengthened 188.44 points or 1.06% to 18,034.19, Hang Seng increased 307.08 points or 1.11% to 28,094.54 and Jakarta Composite soared 47.69 points or 0.8% to 6,026.91.

On the other side, Nikkei 225 slipped 329.40 points or 1.15% to 28,279.09 and Straits Times was down by 12.54 points or 0.4% to 3,140.61.

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