Call it as aftereffects of good quarterly performance or Narendra Modi’s stern measures to drive economy, on Wednesday the NSE Nifty Index crossed the 10,400 mark whereas the SENSEX climbed at 33,600.27 mark. Here are the reasons why we can say that positivity is in the air.
Government gets a breather
The World Bank has released its report on the ease of doing business and India ranks 100 among 190 countries. Earlier, it stood at 130 points. The reason behind it is the introduction of single window clearances, with deemed approvals, timely dissemination of the information, reforms in municipal and local level. Apart from that, the government has taken a slew of measures (merging of PAN and TAN applications, removal of merchant overtime fees, easy dealing with construction permits, registering property) over the last few years to get this much needed boost in the rankings released on Tuesday. The government further plans to improve the ranking with the implementation of GST and Insolvency and Bankruptcy code.
The quarterly results of the companies have brought a ray of hope for the Indian economy. The electrical company Havells, auto company Maruti and host of other companies like ADC India Comm, Aditya Birla Finance, Agri-tech, Ashok Leyland have sailed well and this has resulted in the buoyant stock market.
Core sectors growing at a rapid rate
It is reported that eight core sectors (coal, natural gas, petroleum refinery, crude oil, fertilizer, steel, cement, electricity) have grown by 5.2%, thus elevating the stock market to a new high.
Mergers and acquisitions
It is predicted that ONGC acquisition of HPCL has leveraged its rating and has buoyed the reputation of the Indian government as it would be the first integrated oil and gas company that has both upstream and downstream operations.
Improvement in the banking sector
Once a beleaguered sector has now turned into a profitable sector, thanks to the corrective measures taken by the government! The steps like the capital boost to write off bad loans and infusion of capital has reduced the stress. And this is why the SBI stock rose by 2.22 percent to Rs 312.60.
Strong cues from the global markets
The benchmark indices like BSE Sensex and Nifty opened up high on Wednesday, owing to notched up results from the Asian market and overnight gains from the US market(thanks to the splendid quarterly earnings of the tech stocks). The benchmark indices have posted a positive high.
Though all these factors propelled the stock market to touch a new high, but the IDBI bank results and slow procedures are taking a toll on Indian economy. So, we believe that the government should take measures to rub-off negativity.