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Equity parameters continue to trade in high spirit
Sep-25-2020

Indian equity parameters continued to trade in high spirit in afternoon session as investor sentiments improved amid positive leads from Asian markets. All sectoral indices were trading firm and Telecom was the top gainer on BSE, up by around 5% followed by TECK and IT indices, trading up over 3% each. Apart from blue chips, broader indices too equally participated in the rally with both mid and small cap indices trading up by over 1.50%. The mood on the street remained cheerful with report that the government has extended the suspension of insolvency proceedings for any COVID-19 related default by a period of three months, effective from September 25. Traders also took solace with International Monetary Fund’s (IMF) statement that Prime Minister Narendra Modi’s ‘Aatmanirbhar Bharat’ is an important initiative. The economic package under this self-reliant India initiative, which was announced in the aftermath of the coronavirus shock, has supported the Indian economy and mitigated significant downside risks.

On the global front, Asian markets were trading mixed amid optimism over US stimulus package as House Democrats reportedly plan to unveil a new $2.4 trillion relief bill in the coming days. Back on street, the overall market breadth on BSE was in the favour of advances which thumped declines in the ratio of 1734:663; while 164 shares remained unchanged.

The BSE Sensex is currently trading at 37164.70, up by 611.10 points or 1.67% after trading in a range of 36730.52 and 37187.58. There were 29 stocks advancing against 1 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 1.78%, while Small cap index was up by 1.73%.

The top gaining sectoral indices on the BSE were Telecom up by 4.86%, TECK up by 3.83%, IT up by 3.67%, Healthcare up by 2.41% and FMCG was up by 2.38%, while there were no losing sectoral indices on the BSE.

The top gainers on the Sensex were HCL Tech up by 5.62%, Bharti Airtel up by 4.97%, TCS up by 4.51%, Indusind Bank up by 3.58% and Tech Mahindra was up by 3.29%. On the flip side, Kotak Mahindra Bank was down by 0.28% was only the top losers.

Meanwhile, 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.

As per the notification released by Ministry of Finance, Karnataka can now borrow additional Rs 4,509 crore, while Andhra Pradesh can raise Rs 2,525 crore, followed by Telangana at Rs 2,508 crore. Goa has been allowed to mop up Rs 223 crore from markets and Tripura Rs 148 crore. In view of the unprecedented COVID-19 pandemic the Central Government had in May, 2020 allowed additional borrowing limit of up to 2 percent of Gross State Domestic Product (GSDP) to the States for the year 2020-21. This made an amount up to Rs 4,27,302 crore available to the States.

One percent of this is subject to implementation of four specific State level reforms, where weightage of each reform is 0.25 percent of GSDP. These reforms are implementation of one nation one ration card system; ease of doing business reform; urban local body/ utility reforms; and power sector reforms. The remaining additional borrowing limit of 1 percent was to be released in two instalments of 0.50 percent each - first immediately to all the States as untied, and the second on undertaking at least 3 out of the above mentioned reforms. The Government of India has already granted permission to States to raise the first 0.50 percent as OMB in June, 2020. This made an additional amount of Rs 1,06,830 crore available to the States.

The CNX Nifty is currently trading at 10978.35, up by 172.80 points or 1.60% after trading in a range of 10854.85 and 10991.05. There were 45 stocks advancing against 5 stocks declining on the index.

The top gainers on Nifty were HCL Tech up by 5.48%, Bharti Airtel up by 5.13%, Cipla up by 4.83%, TCS up by 4.36% and Indusind Bank was up by 3.43%. On the flip side, BPCL down by 2.49%, SBI Life Insuran down by 1.42%, Coal India down by 0.35%, Kotak Mahindra Bank down by 0.30% and ONGC was down by 0.23% were the top losers.

Asian markets were trading mixed; Jakarta Composite soared 83.39 points or 1.72% to 4,926.15, Straits Times advanced 17.54 points or 0.72% to 2,468.36, Nikkei 225 surged 116.80 points or 0.51% to 23,204.62 and KOSPI was up by 6.09 points or 0.27% to 2,278.79.

On the flip side; Hang Seng decreased 86.88 points or 0.37% to 23,224.19, Taiwan Weighted dropped 31.47 points or 0.26% to 12,232.91 and Shanghai Composite was down by 1.20 points or 0.04% to 3,221.98.

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