Benchmarks trade higher in early deals

Indian equity benchmarks have made a positive start and are trading slightly in the green in early deals on Monday. Sentiments remained up-beat on report that overseas investors have poured in more than $5 billion into Indian markets so far this month - taking the overall net inflows since beginning of 2014 to over $20 billion. Some support also came in on report that the government is likely to defer implementation of the controversial GAAR provisions by one more year to April 2017 and exempt transactions made up to March 2013 in a bid to improve business sentiment. Meanwhile, India’s Finance Secretary Arvind Mayaram at G-20 meeting in Australia has said that policies of the new government will deepen the reform process to put the economy on sustainable and balanced high growth path.

Global cues too remained supportive as the US markets continued their up-move in last session, though there wasn’t any major cue but traders hoped borrowing costs to remain low for some time to come and led the markets move higher. Most of the Asian markets were trading in the green at this point of time overlooking the geopolitical risks in Iraq and Ukraine and took support from the report that Chinese manufacturing beat estimates in June.

Back home, on the sectoral front, consumer durables, auto and public sector undertaking witnessed the maximum gain in trade, while fast moving consumer goods, software and technology remained the few losers on the BSE sectoral space. The broader indices too were trading in the green in early deals, while the market breadth on the BSE was positive; there were 1226 shares on the gaining side against 627 shares on the losing side while 82 shares remain unchanged.

The BSE Sensex opened at 25108.09; around 3 point higher compared to its previous closing of 25105.51, and has touched a high and a low of 25197.50 and 25107.27 respectively. The index is currently trading at 25133.56, up by 28.05 points or 0.11%. There were 24 stocks advancing against 6 declines on the index.

The overall market breadth has made a strong start with 63.36% stocks advancing against 32.40% declines. The broader indices too were trading in the green; the BSE Mid cap and Small cap indices up by 0.77% and 0.88% respectively. 

The top gaining sectoral indices on the BSE were, while Consumer Durables up by 1.18%, Auto up by 0.79%, PSU up by 0.78%, Oil and Gas up by 0.74% and Capital Goods up by 0.66%, while FMCG down by 1.02%, IT down by 0.61% and TECk down by 0.34% were the few losers on the sectoral index.

The top gainers on the Sensex were Hero MotoCorp up by 1.90%, ONGC up by 1.83%, BHEL up by 1.19%, Tata Steel up by 1.05% and M&M up by 0.96%. On the flip side, ITC was down by 2.02%, Infosys was down by 1.08%, Wipro was down by 0.40%, Cipla was down by 0.39% and TCS was down by 0.24% were the top losers on the Sensex.

Meanwhile, Coal and Power Minister Piyush Goyal has expressed the need to increase the domestic coal production by sorting out environmental issues in order to meet the rising demand. Power Minister has stated that lack of favorable policies over the past couple of years has impacted the domestic coal production and it has become imperative to take measure soon to improve the situation. 

Piyush Goyal also stated that presently coal ministry is in conversation with environment ministry and both ministries are planning to take measures soon to resolve environment concerns, impacting coal mining in the country. By adding further, Coal and Power Minister  stated that to enhance coal production, ministry is also looking at other ways such enhancing morale of coal India employees through giving more incentive. Minister also ensures that there would be an improvement in coal quality in coming future.

India is world's fifth largest in terms of reserves and the third-largest producer of coal. Over the past few years, India domestic production has failed to keep pace with increasing domestic demand. Indian domestic coal demand is around 35 percent higher than domestic supply, resulting into a high deficit of which a huge part is being met by costly imports from Indonesia, South Africa and Australia. Acute coal shortages in the country have become primary reason for power deficit as coal-fired plants account for 68% of India's installed electricity capacity. Presently, Coal India (CIL) is the only producer of domestic coal accounting for around 80 percent of the domestic production. Meanwhile, in order to meet India’s growing coal demand, the government has planned to allot coal mines directly to private players under public-private partnership (PPP) mode, which would also end the monopoly of public sector unit Coal India.

The CNX Nifty opened at 7,514.00; about 3 points higher as compared to its previous closing of 7,511.45, and has touched a high and a low of 7,534.80 and 7,510.00 respectively. The index is currently trading at 7,516.70, up by 5.25 points or 0.07%. There were 37 stocks advancing against 13 declines on the index.

The top gainers of the Nifty were Hero MotoCorp up by 1.90%, ONGC up by 1.78%, Lupin up by 1.26%, BHEL up by 1.21% and Indusind Bank up by 1.18%. On the flip side, ITC down by 1.97%, Kotak Bank down by 1.55%, HCL Tech down by 1.10%, Infosys down by 1.09% and Infosys down by 0.75% were the major losers on the index.

Asian markets were trading mostly in the green; Nikkei 225 soared 10.11 points or 0.07% to 15,359.53, Hang Seng increased by 68.33 points or 0.29% to 23,262.39, KOSPI Index gained 9.15 points or 0.46% to 1,977.22, Straits Times improved 3.08 points or 0.09% to 3,261.88, Jakarta Composite 1.17 points or 0.02% to 4,848.87 and Shanghai Composite was up by 0.68 points or 0.03% to 2,027.35.

On the flip side, FTSE Bursa Malaysia KLCI declined 2.79 points or 0.15% to 1,882.93 and Taiwan Weighted was down by 23.45 points or 0.25% to 9,250.34.