Benchmarks trade slightly in the green in early deals

Indian equity benchmarks are trading slightly in the green in early deals on hopes that the BJP-led NDA is set to form a stable government and set the reforms process in motion to stimulate growth. However, the up-side remained capped as investors turned cautious with Organisation for Economic Cooperation and Development (OECD) saying that India, China and other major emerging economies are expected to see weak growth even as momentum remains stable in the developed world.

On the global front, the US markets ended mixed overnight after a volatile trade in last session, though the Dow and the S&P 500 still ended the session at new record closing highs but trade remained lackluster. The Asian markets were trading mostly in the green at this point of time. Though, Chinese market was marginally in red after country’s central bank called on the biggest lenders to accelerate the granting of mortgages.

Back home, on the sectoral front, metal, realty and FMCG witnessed the maximum gain in trade, while capital goods and software remained the only losers on the BSE. The broader indices, however, were outperforming benchmarks, while the market breadth on the BSE was positive; there were 1,064 shares on the gaining side against 556 shares on the losing side while 70 shares remain unchanged.

The market breadth on BSE remains positive with advances to declines in the ratio of 995:545. BSE Sensex and NSE Nifty were comfortably trading near their psychological 23,900 and 7,100 levels respectively.

The BSE Sensex is currently trading at 23941.46, up by 70.23 points or 0.29% after trading in a range of 23964.67 and 23805.09. There were 21 stocks advancing against 9 declines on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.88% and Small cap index gained 1.02%.

The top gaining sectoral indices on the BSE were, Power up by 1.27%, Realty up by 1.22%, PSU up by 1.08%, Oil & Gas up by 0.86% and Capital Goods up by 0.82%, while Capital Goods down by 0.34% and IT down by 0.16% were the top losers.

The top gainers on the Sensex were Bajaj Auto up by 7.79%, Tata Steel up by 1.73%, ITC up by 1.47%, SBI up by 1.42% and NTPC up by 3.33%. On the flip side, Mahindra & Mahindra was down by 1.80%, BHEL was down by 1.46%, Dr Reddys Lab was down by 1.16%, Infosys was down by 0.90% and ONGC down by 0.86% were the top losers on the Sensex.

Meanwhile, India’s pharmaceutical exports grew by 10.5 percent to $1.26 billion in the month of April from a year earlier. The Pharmaceuticals Export Promotion Council (Pharmexcil) expects a healthy rate of growth in pharma exports at around 12 percent in current fiscal on the back of rising demand of drugs from African countries. The government has set pharma exports target for current fiscal at $25 billion.

In the previous fiscal, Indian pharma exports grew at a slowest pace in 15 years at 1.2 percent to $14.84 billion amid growing tension with the US over intellectual property rights (IPR) related issues. The previous slowest growth rate for domestic pharma exports was in FY10 at 5.9 percent. The US accounts for about 25 percent of India's pharma exports. Presently, US pharma industry is contending that India's IPR laws particularly with regard to pharma sector discriminate American firms and put pressure on the US government to take actions against India. Further, major domestic players such as Ranbaxy and Wockhardt are facing imports alerts on some major plants issued by the US Food and Drug Administration (USFDA) in 2013.

Indian is the top exporters to the Commonwealth of Independent States (CIS) region countries. The prevailing political turmoil between Ukraine and Russia which has led to political and economic tensions in the Crimean region, has also hit the businesses of leading Indian pharmaceutical companies.

The CNX Nifty is currently trading at 7,136.30 up by 27.55 points or 0.39% after trading in a range of 7,142.25 and 7,096.15. There were 38 stocks advancing against 12 declines on the index.

The top gainers of the Nifty were PNB up by 3.12%, Jindal Steel up by 3.05%, Bank Baroda up by 2.60%, Bajaj-Auto up by 2.41% and Grasim up by 1.72%. On the flip side, M&M down by 2.14%, BHEL down by 1.94%, DR Reddy down by 1.22%, ONGC down by 1.19% and Infosys down by 0.93% were the top losers on the index.

Most of Asian equity indices were trading in green; Hang Seng increased 203.02 points or 0.91% to 22,555.40, Jakarta Composite added 43.18 points or 0.88% to 4,964.58, KLSE Composite gained 8.04 points or 0.43% to 1,874.12, Straits Times soared 33.21 points or 1.03% to 3,255.64, Seoul Composite jumped by 19.52 points or 0.98% to 2,002.45 and Taiwan Weighted was up by 34.99 points or 0.40% to 8,852.93.

On the flip side, Shanghai Composite declined 3.37 points or 0.16% to 2,047.36 and Nikkei 225 was down by 30.35 points or 0.21% to 14,395.09.