Benchmarks pare gains; trade continues in green

Indian equity benchmarks pared gains but continued to trade in green in the late afternoon session on account of buying in frontline counters. The sentiments were on optimistic mood on International Monetary Fund (IMF) report which showed that Indian economy is recovering to its potential growth rate at 6.75 to 7 percent. Investors have started eyeing April IIP and May CPI data which is scheduled to be released later in the day. Traders were seen piling up positions in HealthCare, Realty and Auto, while selling was witnessed in India Infrastructure Index, Power and TECK sector stocks. In scrip specific development, Jubilant Life Sciences, the manufacturer of vitamin B3 (Niacin and Niacinamide), was trading in green touching 52-week high after the company announced a price increase of 9% for Niacinamide with immediate effect. ADF Foods was locked at upper circuit limit after its promoter raised stake in the company through block deal. Bharti Airtel was trading weak after a foreign brokerage firm downgraded the stock and reduced its target price citing competition.

On the global front, the Asian markets were trading mostly in red, while the European markets traded mostly on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 7,600 and 25,500 levels respectively. The market breadth on BSE was positive in the ratio of 1682:1306 while 87 scrips remained unchanged.

The BSE Sensex is currently trading at 25548.32, up by 74.43 points or 0.29% after trading in a range of 25611.32 and 25409.69. There were 17 stocks advancing against 13 stocks declining on the index.   

The broader indices were trading in green; the BSE Mid cap index was up by 0.49%, while Small cap index up by 0.53%.   

The top gaining sectoral indices on the BSE were HealthCare up by 0.82%, Realty up by 0.64%, Auto up by 0.38%, Consumer Durables up by 0.34% and FMCG up 0.27% while, India Infrastructure Index down by 0.38%, Power down 0.24%, TECK down by 0.22%, Capital goods down 0.15% and PSU down 0.06% were the only losing indices on BSE.   

The top gainers on the Sensex were Hindalco Industries up by 2.52%, HDFC Bank up by 2.38%, Sun Pharma up by 1.87%, HDFC up by 1.69% and TCS up by 0.90%. On the flip side, Bharti Airtel down by 3.02%, Axis Bank down by 2.28%, Coal India down by 2.13%, BHEL down by 1.40% and ICICI Bank down by 0.90% were the top losers.   

Meanwhile, India’s mining sector witnessed a marked fall in output during 2000s on account of country’s rising dependence on crude oil imports. The Reserve Bank of India (RBI) report, which is based on trends in output growth and labour productivity growth during 1980-2008 in six broad sectors, has highlighted that the output of mining sector has declined during the period 2000-2008 as increased domestic demand for crude oil was being met trough the imports rather than domestic production. 

Further, the RBI’s report noted that the sector like agriculture, mining and quarrying witnessed decline in productivity during period 2000-2008 as compared to period 1980-1999.   However, there has been a revival of productivity growth in many industries since 2000. Sectors such as manufacturing, electricity, gas & power and services showed improvements in total factor productivity (TFP), the report added. The growth of manufacturing sector stood at 6.13 percent per annum during the period under study.

The report further highlighted that the gross value added (GVA), which is the value of output minus the value of intermediate inputs, rose by about 2 percentage points between 1980-99 and 2000-08, showing a rise to 7.6 percent per annum during 2000-08 from 5.2% per annum during 1980-99. The broad sector such as manufacturing, construction and services experienced acceleration in value added growth rate between 2000 and 2008. Among these three sectors, construction sector showed high acceleration in value added growth with trend growth rate in real gross value added of construction increasing from 4.7% per annum during 1980-99 to close to 10% per annum from 2000- 08. Further, the report also found that during the period 1980-2008, the growth in persons employed was driven mainly by construction and the services sectors.

The CNX Nifty is currently trading at 7632.40, up by 5.55 points or 0.07% after trading in a range of 7656.15 and 7593.80. There were 21 stocks advancing against 29 stocks declining on the index.   

The top gainers on Nifty were Hindalco Industries up by 2.74%, HDFC Bank up by 2.43%, Jindal Steel up by 2.39%, Sun Pharma up by 1.99% and HDFC up by 1.75%. On the flip side, Bharti Airtel down by 3.08%, Coal India down by 2.18%, Axis Bank down by 2.16%, BPCL down by 2.01% and Ambuja Cements down by 1.58% were the top losers.   

Asian equity indices were trading mostly in red; Shanghai Composite down by 0.16%, Hang Seng down by 0.35%, Jakarta Stock Index down by 0.87%, Nikkei down by 0.64% and Taiwan Weighted down by 0.27% while, Straits Times up by 0.07% was the lone gainer Among Asian pack.

The European markets were trading mostly in green; France’s CAC 40 added 0.20%, Germany’s DAX gained 0.09% while, UK’s FTSE 100 was down by 0.07%.