Benchmarks add gains; Metal, Consumer Durables lift

Indian equity benchmarks added gains to continue their firm trade hovering near the highest point of the day in the late afternoon session on account of buying in frontline counters. The sentiments got some boost after the Reserve Bank of India (RBI) kept key interest rates unchanged in its first monetary policy announcement since new pro-growth Prime Minister Narendra Modi took office. Traders were seen piling up positions in Metal, Consumer Durables and Power stocks, while selling was witnessed in FMCG, HealthCare and IT sector stocks. Hectic activity was witnessed in sugar related stocks as the government is considering revival of sugar industries and thinking to push ethanol blending in petrol from current 5%. This move will help release arrears of cane growers in Uttar Pradesh. In scrip specific development, Zee Entertainment Enterprises was trading in green after the Reserve Bank of India allowed 100% investment by foreign institutional investors. Multi Commodity Exchange of India was trading in green after foreign brokerage house raised price target on the stock.

On the global front, the Asian markets were trading mostly in green, while the European markets traded on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 7,400 and 24,800 levels respectively. The market breadth on BSE was positive in the ratio of 1791:1047 while 113 scrips remained unchanged.

The BSE Sensex is currently trading at 24882.34, up by 197.49 points or 0.80% after trading in a range of 24892.09 and 24626.97. There were 23 stocks advancing against 7 stocks declining on the index.

The broader indices continued to add ground; the BSE Mid cap index was up by 0.80%, while Small cap index up by 1.16%.

The gaining sectoral indices on the BSE were Metals up by 4.03%, Consumer Durables up 1.85%, Power up by 1.53%, Capital Goods up by 1.44% and Oil & Gas up by 1.41% while, FMCG down by 0.67%, HealthCare down by 0.17% and IT down by 0.06% were the losing indices on BSE.   

The top gainers on the Sensex were SSLT up by 6.87%, Coal India up by 4.33%, Tata Steel up by 4.11%, NTPC up by 3.23% and Hero MotoCorp up by 2.67%. On the flip side, Dr. Reddy’s Lab down by 2.20%, ITC down by 1.16%, HUL down by 1.03%, Wipro down by 0.92% and Gail India down by 0.65%.

Meanwhile, the government has slashed the import tariff on gold to $408 per 10 gram from $424 and silver to $617 per kg from $650 per kg, in line with global rates of the precious metals, which could lead to some softening in the prices. Tariff value or the base price is set to determine the customs duty on the precious metal and to prevent under invoicing. The government revises import tariff value on a fortnightly basis taking into account the volatility in global metal prices.

During the recent months, global gold prices have been declinilng as positive US economic data backed the latest Federal Reserve’s move to keep on reducing monetary stimulus which has dimmed the precious metal's appeal. Taking global cues, domestic gold rates in the national capital Delhi declined to 11-month low at Rs 27,400 per 10 grams.

Gold is the second largest import item for India after crude oil. The government had taken various measures like high customs duty of 10% and 80/20 rule to curb gold shipments to check country’s widening current account deficit (CAD). Gold and silver imports fell by 40.02% to $33.46 billion in FY14 due to these stern Government’s norms. Low gold imports also helped India to contain current account deficit (CAD) at 1.7 percent of GDP or $32.4 billion in FY 14 as compared to $87.8 billion, or 4.7 percent of GDP in FY13.

The CNX Nifty is currently trading at 7,419.60, up by 57.10 points or 0.78% after trading in a range of 7,423.50 and 7,342.15. There were 34 stocks advancing against 16 declining ones on the index.

The top gainers of the Nifty were SSLT up by 6.73%, Grasim up by 5.36%, Tata Steel up by 4.56%, Coal India up by 4.16% and Ambuja Cements up by 3.88%. On the flip side, Dr. Reddy’s Lab down by 2.47%, HCL Tech down by 2.29%, HUL down by 1.21%, Kotak Bank down by 1.21% and Gail India down by 1.02% were the major losers on the index.

Most of Asian equity indices were trading in green; Hang Seng advanced 0.91%, Taiwan Weighted up by 0.52%, Nikkei 225 surged 0.66% and Jakarta Stock Index rose by 0.43% while, Straits Times down by 0.21% and Shanghai Composite inched down by 0.04%.

The European markets were trading in red; France’s CAC 40 was down by 0.12%; UK’s FTSE 100 lost 0.36% and Germany’s DAX was down by 0.25%.