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Firm trade persists on Dalal Street
Sep-25-2020

Firm trade continued over the Dalal Street in late morning deals, as both Sensex and Nifty are trading higher with strong gains. Positive cues from other Asian markets helped key indices to maintain their gaining momentum. Domestic sentiments were positive, after the Department of Expenditure, Ministry of Finance, has granted permission to raise additional financial resources of Rs. 9,913 crore to 5 States through Open Market Borrowings (OMBs). These States are Andhra Pradesh, Telangana, Goa, Karnataka and Tripura. This permission has been accorded after these States successfully met the reform condition of implementation of One Nation One Ration Card System.

On the global front, Asian markets were trading mostly in green, after Taiwan's retail sales rose for a second straight month in August. The official data showed that retail sales grew 8.17 percent year-on-year following a revised 2.79 percent increase in July. Automobile sales jumped 33.5 percent. Sales at non-specialized stores rose 5.7 percent, led by a 15.6 percent gain at convenience stores. Online and mail-order sales increased 16.4 percent. Sales of fuel and related products decreased 14.9 percent.

The BSE Sensex is currently trading at 36959.57, up by 405.97 points or 1.11% after trading in a range of 36730.52 and 37053.59. There were 26 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.31%, while Small cap index was up by 1.36%.

The top gaining sectoral indices on the BSE were Telecom up by 4.16%, TECK up by 3.09%, IT up by 2.95%, FMCG up by 2.03% and Healthcare up by 1.48%, while Energy down by 0.02% was the only losing indices on BSE.

The top gainers on the Sensex were HCL Tech up by 5.32%, Bharti Airtel up by 4.31%, TCS up by 3.50%, Tech Mahindra up by 3.15% and Nestle up by 2.73%. On the flip side, Kotak Mahindra Bank down by 0.87%, Bajaj Auto down by 0.13%, Reliance Industries down by 0.11% and HDFC down by 0.03% were the top losers.

Meanwhile, the government has extended the suspension of fresh insolvency proceedings under the insolvency law by three months till December 25. This provides ‘breathing time’ for companies to recover from coronavirus pandemic-induced financial stress. The six-month period of suspension, which was effective from March 25, was to end on September 24.

The suspension of fresh proceedings under the Insolvency and Bankruptcy Code (IBC) has been extended for a ‘period of three months from the September 25, 2020’. An ordinance was promulgated in June for suspension of fresh insolvency proceedings and the same came into effect from March 25 -- the day when the nationwide lockdown had come into effect. A bill to replace the ordinance that had amended the IBC was cleared by Parliament.

The ministry, which is implementing the IBC, has suspended Section 7, 9 and 10 to provide relief for companies reeling under the impact of the pandemic. Sections 7, 9 and 10 deal with initiation of corporate insolvency resolution process by a financial creditor, operational creditor and corporate debtor, respectively.

The CNX Nifty is currently trading at 10924.60, up by 119.05 points or 1.10% after trading in a range of 10854.85 and 10950.40. There were 43 stocks advancing against 7 stocks declining on the index.

The top gainers on Nifty were HCL Tech up by 5.44%, Adani Ports & SEZ up by 4.22%, Bharti Airtel up by 4.05%, TCS up by 3.55% and Tech Mahindra up by 3.19%. On the flip side, BPCL down by 2.19%, SBI Life Insurance down by 1.26%, Kotak Mahindra Bank down by 0.86%, Coal India down by 0.61% and HDFC Life Insurance down by 0.54% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 117.87 points or 0.51% to 23,205.69, Jakarta Composite soared 69.80 points or 1.44% to 4,912.56, KOSPI rose 11.46 points or 0.5% to 2,284.16 and Straits Times advanced 11.06 points or 0.45% to 2,461.88. On the flip side, Shanghai Composite declined 7.76 points or 0.24% to 3,215.42, Hang Seng decreased 48.93 points or 0.21% to 23,262.14 and Taiwan Weighted dropped 95.80 points or 0.78% to 12,168.58.

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