Indian equity benchmarks made a cautious start and are managing to trade tad above their neutral lines as traders remained on sidelines ahead of the RBI's monetary policy outcome to be announced later in the day. The Reserve Bank of India’s Monetary Policy Committee began its bi-monthly deliberations on June 2, amid expectations of keeping a status quo on repo and reverse repo rates due to uncertainty over the impact of the second COVID-19 wave. Key gauges are getting some support with union Minister Anurag Singh Thakur’s statement that financial inclusion is a top priority for the government and that promoting financial education would help in realising the collective potential. Traders also took some encouragement with Commerce Secretary Anup Wadhawan’s statement the time frame to resume negotiations for the stalled free trade agreement with the European Union (EU) and to initiate fresh talks for a pact with the UK will be very early and the talks will start soon after completion of the preparatory work.
On the global front, the US markets ended lower on Thursday on wary about the Federal Reserve potentially shifting monetary policy. Asian markets were trading mostly lower in early deals on Friday following the negative cues overnight from Wall Street as signs of a strengthening US recovery boosted bets for higher inflation and an earlier tapering of Federal Reserve stimulus.
Back home, banking stocks remained in limelight as public sector banks have been at the forefront for advancing loans under the PM Street Vendors Atmanirbhar Nidhi (PM SVANidhi), and have sanctioned 2.316 million loans, about 95% of total loans sanctioned under this scheme as on May 31. Aviation stocks remained in focus as Domestic air traffic nosedived to 19.20 lakh passengers in May from around 57.3 lakh in April, registering a sharp 65-67 per cent month-on-month contraction on account of the second wave of the pandemic. With such a sharp fall, the domestic passenger traffic reached lower than the June-July 2020 levels.
The BSE Sensex is currently trading at 52279.53, up by 47.10 points or 0.09% after trading in a range of 52205.73 and 52368.61. There were 21 stocks advancing against 9 stocks declining on the index.
The broader indices were trading in green; the BSE Mid cap index gained 0.40%, while small cap index was up by 0.58%.
The top gaining sectoral indices on the BSE were Capital Goods up by 0.90%, Industrials up by 0.80%, Utilities up by 0.67%, Power up by 0.63% and Telecom up by 0.61%, while Metal down by 0.74%, FMCG down by 0.36%, Energy down by 0.17%, Bankex down by 0.12% and Basic Materials down by 0.12% were the top losing indices on BSE.
The top gainers on the Sensex were ONGC up by 2.12%, Larsen & Toubro up by 1.31%, Indusind Bank up by 1.31%, Mahindra & Mahindra up by 1.23% and Bajaj Finance up by 0.80%. On the flip side, Nestle down by 0.97%, Hindustan Unilever down by 0.58%, Dr. Reddys Lab down by 0.58%, Titan Company down by 0.50% and ITC down by 0.38% were the top losers.
Meanwhile, Chief Economic Advisor KV Subramanian has said the second wave of COVID-19 has affected the momentum of economic recovery. However, he also pointed that he expects a recovery in the economy from July onwards. He stated ‘now, several states have started removing many restrictions and if we speed up the vaccination drive in our country, our economy will start recovering.’
Talking about the ongoing COVID-19 vaccination drive in the country, He said, ‘India will be able to achieve vaccination for all by December. If we vaccinate people in three shifts each day, then, we can vaccinate 1 crore people in a day. This is definitely ambitious, but not impossible. I have taken both doses of vaccine and appeal to all to get themselves vaccinated as soon as possible.’
He mentioned that the ongoing vaccination drive can significantly 'lower down' the impact of the pandemic. Thus, the more people are vaccinated, the more it will lower down the impact of the third wave and will not be as harmful as expected. Besides, He said that COVID-19 is not going to impact country’s fiscal deficit target and disinvestment target.
The CNX Nifty is currently trading at 15712.60, up by 22.25 points or 0.14% after trading in a range of 15680.15 and 15715.15. There were 32 stocks advancing against 18 stocks declining on the index.
The top gainers on Nifty were ONGC up by 2.29%, Indusind Bank up by 1.33%, Hero MotoCorp up by 1.30%, Mahindra & Mahindra up by 1.30% and Larsen & Toubro up by 1.28%. On the flip side, Cipla down by 1.04%, Nestle down by 1.00%, Eicher Motors down by 0.64%, Hindustan Unilever down by 0.63% and Dr. Reddys Lab down by 0.56% were the top losers.
Asian markets were trading mostly in red; Nikkei 225 fell 125.40 points or 0.43% to 28,932.71, Straits Times lost 2.19 points or 0.07% to 3,162.81, Taiwan Weighted dropped 101.91 points or 0.59% to 17,144.25, KOSPI declined 6.19 points or 0.19% to 3,241.24 and Jakarta Composite slipped 44.91 points or 0.74% to 6,046.60. However, Hang Seng rose 49.18 points or 0.17% to 29,015.21 and Shanghai Composite was up by 5.07 points or 0.14% to 3,589.28.