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Local barometer gauges were trading firmly in green, with gains of around a percent, which lifted both Sensex and Nifty above psychologically crucial 56200 and 16800 levels respectively. Broader indices also imitating similar upbeat mood, were trading higher in the range of 0.60%-0.80%. Traders cheered reports stating that the Services sector activities improved further and touched a five-month high in April driven by a surge in incoming new work orders that boosted business activity and supported a renewed increase in employment. The seasonally adjusted S&P Global India Services PMI Business Activity Index jumped to 57.9 in April, from 53.6 in March, highlighting a sharp rate of expansion that was the fastest since last November amid mounting price pressures. Meanwhile, the blockbuster IPO of the country’s largest life insurer Life Insurance Corporation of India (LIC) which opened for subscription on May 4, 2022, was subscribed by around 78 per cent so far on the second day.

On the global front, Asian markets were trading mostly higher after the US Fed raised by 50 basis points, its sharpest hike in 22 years, to tame the soaring inflation. Back home, on BSE, most of the sectoral indices on BSE were trading into positive territory; stocks from realty counter was the only exceptions that were trading down in dumps. On the flip side, stocks from capital goods, metals and technology counters were the top gainers of the session.

The BSE Sensex is currently trading at 56211.42, up by 542.39 points or 0.97% after trading in a range of 55976.39 and 56566.80. There were 25 stocks advancing against 5 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.61%, while Small cap index was up by 0.76%.

The top gaining sectoral indices on the BSE were Capital Goods up by 2.26%, Metal up by 2.20%, TECK up by 1.86%, IT up by 1.79% and Power was up by 1.77%, while Realty was down by 0.74% was the only losing index on BSE.

The top gainers on the Sensex were Tata Steel up by 3.69%, Infosys up by 3.13%, Tech Mahindra up by 2.76%, SBI up by 2.27% and Larsen & Toubro was up by 2.17%. On the flip side, Indusind Bank down by 1.68%, Nestle down by 1.66%, Reliance Industries down by 0.63%, Titan Co down by 0.45% and Ultratech Cement was down by 0.41% were the top losers.

Meanwhile, expressing concerns over growth of Indian automobile industry, automobile dealers' body -- Federation of Automobile Dealers Associations (FADA) has said the increase in repo rate will ‘apply certain amount of brakes’ on the industry's growth, especially the two-wheeler segment which is already reeling under a severe slowdown. Home, auto and other loan EMIs are likely to go up after the Reserve Bank of India (RBI) hiked its key interest rate by 40 bps in an unexpected move on May 04 to tame the rising inflation that has remained stubbornly above target in the recent months.

FADA) President Vinkesh Gulati said ‘The RBI's move of increasing repo rate by 40 bps has clearly taken everyone off guard. This move will curb excess liquidity in the system and will make auto loans expensive’. He added the passenger vehicle segment may be able to absorb this shock due to long waiting periods. However, the two-wheeler segment, which has been a non-performer due to an underperforming rural market, vehicle price hikes and high fuel costs, will not be able to take one more blow of high vehicle loan costs.

He also said ‘Certainly, this move will apply certain amount of brakes on auto retail and dampen the sentiments further’. As per the FADA, in March, two-wheeler sales declined by 4 per cent to 11,57,681 units as compared with 12,06,191 units in the year-ago period. FADA represents over 15,000 automobile dealers having 26,500 dealerships across the country.

The CNX Nifty is currently trading at 16837.75, up by 160.15 points or 0.96% after trading in a range of 16778.85 and 16945.70. There were 39 stocks advancing against 11 stocks declining on the index.

The top gainers on Nifty were Hero MotoCorp up by 3.82%, Tata Steel up by 3.81%, Infosys up by 3.21%, Tech Mahindra up by 2.91% and ONGC was up by 2.68%. On the flip side, Tata Consumer Products down by 3.65%, Indusind Bank down by 1.71%, Nestle down by 1.70%, Apollo Hospital down by 1.18% and Britannia Inds was down by 1.18% were the top losers.

Asian markets were trading mostly in green; Taiwan Weighted strengthened 130.29 points or 0.79% to 16,696.12, Shanghai Composite gained 21.13 points or 0.69% to 3,068.19 and Hang Seng was up by 74.78 points or 0.36% to 20,944.30. On the other hand, Straits Times was down by 5.87 points or 0.18% to 3,343.40.

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