Benchmarks trade in fine fettle in early deals on Tuesday

Indian equity benchmarks have made a positive start and are trading jubilantly with gain of over a percentage point, tracking rally in Asian markets. All the Asian equity indices were trading in the green at this point of time as improved manufacturing data from China, Japan and the United States augured well for global growth, despite a disappointing result from the euro zone. Though, the US markets ended almost flat in last session, as the trade remained choppy and reflected uncertainty about the near-term outlook for the markets.

Back home, shares of sugar companies like Bajaj Hindustan, Shree Renuka Sugars, Balrampur Chini Mills, Oudh Sugars, Ugar Sugar Works, Ponni Sugar Erode, Simbhaoli Sugars and EID Parry continued their upward march for the second day in a row on announcement of a series of measures for the sugar industry, including an increase in the import duty from 15% to 40%, to improve its financial health. Moreover, stocks related to textile space too edged higher as Union Textiles Minister Santosh Kumar Gangwar has said that textile exports are set to touch $50-billion mark in the current fiscal.

On the sectoral front, infrastructure, realty and fast moving consumer goods witnessed the maximum gain in trade, while software remained the lone loser on the BSE sectoral space. The broader indices too were trading in-line with benchmarks, while the market breadth on the BSE was positive; there were 1331 shares on the gaining side against 396 shares on the losing side while 53 shares remain unchanged.

The BSE Sensex opened at 25115.83; around 84 point higher compared to its previous closing of 25031.32, and has touched a high and a low of 25335.27 and 25115.83 respectively. The index is currently trading at 25312.69, up by 281.37 points or 1.12%. There were 27 stocks advancing against 3 declines on the index.

The overall market breadth has made a strong start with 74.78% stocks advancing against 22.25% declines. The broader indices too were trading in the green; the BSE Mid cap and Small cap indices up by 1.10% and 1.29% respectively. 

The top gaining sectoral indices on the BSE were,Infrastructure up by 1.60%, Realty up by 1.59%, FMCG up by 1.39%, Power up by 1.36% and Capital Goods up by 1.32%, while IT down by 0.01% was the lone loser on the sectoral index.

The top gainers on the Sensex were GAIL up by 2.62%, HDFC up by 2.36%, ITC up by 2.01%, SSLT up by 1.57% and M&M up by 1.53%. On the flip side, Infosys was down by 0.51%, ONGC was down by 0.33% and Wipro was down by 0.14% were the few losers on the Sensex.

Meanwhile, with an aim to develop Indian capital markets, the Securities and Exchange Board of India (SEBI) has asked the government to provide clarity on tax benefits for new products like Real Estate Investment Trusts (REITs), Infrastructure Investment Trusts and debt securities.

The capital market regulator is of the view that REITs and infrastructure bonds would allow investors to invest in specific products linked to real estate projects and infrastructure projects besides providing necessary safeguards. Further, these products would also help the corporates raise significant amounts of capital for their projects. Therefore, there is a need to remove certain anomalies in tax structure for these products.

Regarding the REITs, SEBI Chairman U K Sinha has asserted that REITs have been a significant vehicle for global investors and Indian capital markets will soon tap this opportunity as SEBI is ready with guidelines that would be announced immediately after tax clarity from the government. Sinha further added that to expand corporate bond markets, new draft for debt was already in place compromising simplified regulations. 

SEBI’s chairman also expressed the need to encourage Small and Medium Enterprises (SMEs) to get listed and get benefited from the capital markets. SEBI has also identified certain SME clusters to encourage listing. At present, the listed SME market capitalisation in India stands at over Rs 7,500 crore, while only 65 companies have got listed on SME Platform of exchanges. Furthermore, SEBI would soon put in place norms for crowd funding, which would allow start- ups to tap new platforms to raise funds.

The CNX Nifty opened at 7,515.20; about 22 points higher as compared to its previous closing of 7,493.35, and has touched a high and a low of 7,572.10 and 7,515.20 respectively. The index is currently trading at 7,570.10, up by 76.75 points or 1.02%. There were 44 stocks advancing against 6 declines on the index.

The top gainers of the Nifty were GAIL up by 2.91%, HDFC up by 1.98%, BPCL up by 1.83%, ITC up by 1.78% and SSLT up by 1.73%. On the flip side, HCL Tech down by 0.95%, Infosys down by 0.66%, ONGC down by 0.61%, Kotak Bank down by 0.18% and Tech Mahindra down by 0.16% were the major losers on the index.

Asian markets were trading mostly in the green; Nikkei 225 soared 18.75 points or 0.12% to 15,388.03, Hang Seng surged by 79.99 points or 0.35% to 22,884.80, KOSPI Index improved by 20.04 points or 1.01% to 1,994.96, Straits Times increased 7.18 points or 0.22% to 3,264.58, Jakarta Composite gained 18.54 points or 0.38% to 4,860.67, Shanghai Composite climbed by 8.02 points or 0.40% to 2,032.38, FTSE Bursa Malaysia KLCI spurted by 1.99 points or 0.11% to 1,885.95 and Taiwan Weighted was up by 10.10 points or 0.11% to 9,238.45.