Benchmarks trade higher in early deals on firm global cues

Buoyed by firm global cues, Indian equity benchmarks have made a positive start and are trading in fine fettle in early deals with frontline gauges recapturing their crucial 7,250 (Nifty) and 24,350 (Sensex) levels. Overnight, the US markets ended modestly higher, snapping one of the best months of the year so far. Though, the economic news was mixed but traders concentrated on some deal news and added positions. Asian equity markets too were trading mostly in the green at this point of time following record highs for the S&P 500 and the Dow Jones last week and mixed Chinese data.

Back home, some support also came in from reports that foreign institutional investors (FIIs) bought shares worth a net Rs 2,977.62 crore on May 30, 2014, as per provisional data from the stock exchanges. However, gains on the up-side remained capped after India’s economic growth remained below the 5 percent mark for the second year in a row at 4.7 percent in 2013-14.  Growth remained subdued at 4.6 percent in the fourth quarter of 2013-14 too, mainly due to a decline in manufacturing and mining output. Moreover, traders also remained cautious ahead of the Reserve Bank of India (RBI) monetary policy on Tuesday, its first exercise after the installation of the new union government. Though, the RBI is likely to keep rates unchanged as the governor Raghuram Rajan has said that government and the central bank have both stressed on the need to bring down inflation.

On the sectoral front, capital goods, realty and power witnessed the maximum gains in trade, while fast moving consumer goods and healthcare remained the only losers on the BSE sectoral space. The broader indices to were trading with traction in early deals, while the market breadth on the BSE was positive; there were 1,297 shares on the gaining side against 552 shares on the losing side while 67 shares remain unchanged.

The BSE Sensex opened at 24,368.96; about 151 points higher compared to its previous closing of 24,217.34, and has touched a high and a low of 24388.15 and 24270.20 respectively. The index is currently trading at 24333.37, up by 116.03 points or 0.48%. There were 20 stocks advancing against 10 declines on the index.

The overall market breadth has made a strong start with 67.87% stocks advancing against 28.89% declines. The broader indices too were trading with traction; the BSE Mid cap and Small cap indices up by 1.06% and 0.98% respectively. 

The top gaining sectoral indices on the BSE were, Capital Goods up by 3.07%, Realty up by 1.09%, Power up by 0.81%, Oil & Gas up by 0.80% and Metal up by 0.67% while, FMCG down by 0.88% and Healthcare down by 0.38% were the only losers on the sectoral index.

The top gainers on the Sensex were L&T up by 4.24%, Bharti Airtel up by 1.98%, GAIL up by 1.67%, Hindalco up by 1.56% and HDFC up by 1.37%. On the flip side, NTPC was down by 2.41%, M&M was down by 1.74%, Hindustan Unilever was down by 1.49%, ITC was down by 1.32% and TCS was down by 0.92% were the top losers on the Sensex.

Meanwhile, Prime Minister Narendra Modi has unveiled a 10-point agenda for good governance. Assigning maximum importance to bureaucratic empowerment and good governance, Prime Minister told ministers to prepare a detailed action plan for the first 100 days in office and resolve all issues left pending by the previous government on a priority basis.

Ministries should give focus on delivery and implementation and agenda for governance should be embedded into day-to-day functioning and policy making, he added. Prime Minister’s latest agenda for good governance highlighted 10-point framework include build up confidence in bureaucracy, give priority to education, health, water and power, mechanism for inter-ministerial issues, addressing concerns about economy, stability and sustainability in government policy, give bureaucrats independence to work without pressure, transparency in governance, infrastructure development, implement policy in time bound manner and people orientated system for better addressing people’s problems. 

Narendra Modi has also reiterated the importance of dealing with states' problems on a priority basis and told cabinet ministers to share their workload with junior ministers such as state ministries. In order to strengthen the federal structure, there is a need to take the states along with the Centre, he added. Prime Minister has started the process of scrutinizing bills which have lapsed in the Lok Sabha and Rajya Sabha and need to be revived.

The CNX Nifty opened at 7,264.05; about 35 points higher as compared to its previous closing of 7,229.95, and has touched a high and a low of 7,279.05 and 7,239.50 respectively.

The index is currently trading at 7,262.25, up by 32.30 points or 0.45%. There were 34 stocks advancing against 16 declines on the index.

The top gainers of the Nifty were L&T up by 4.69%, NMDC up by 4.32%, Power Grid up by 2.62%, Jindal Steel up by 2.38% and Bharti Airtel up by 1.98%. On the flip side, NTPC down by 2.55%, HUL down by 2.09%, M&M down by 2.06%, Sun Pharma down by 1.42% and ITC down by 1.24% were the major losers on the index.

Most of the Asian equity indices were trading in green; Nikkei 225 soared 305.29 points or 2.09% to 14,937.63, Straits Times added 2.49 points or 0.08% to 3,298.34 and KOSPI Composite was up by 5.31 points or 0.27% to 2,000.27.

On the flip side, Jakarta Composite dropped 16.016 points or 0.33% to 4,877.90 and KLSE Composite was down by 11.17 points or 0.60% to 1,862.21.

Taiwan, China and Hong Kong markets remained shut for the trade today for the Dragon Boat Festival.