Markets continue to trade in green amid buying in metal, auto and realty stocks

Indian benchmarks continue to trade in green led by gains in metal, auto and realty stocks. Sentiments got support as business activity in Indian manufacturing sector expanded at its quickest pace since February to 51.5 in June mainly driven by higher domestic and export order flows. Sentiment also remained bullish following sustained capital inflows by foreign funds and widespread buying by retail investors amid expectations that the government will announce reform measures in coming budget 2014-15 to boost the business sentiments in the country. Though most of the sectoral indices were trading in green, sharp selling witnessed in defensive sectors stocks such as IT, teck and healthcare capped market's gains. There was some cautiousness among investors over the sluggish macro-economic data. Core sectors output grew at a four-month low of 2.3 percent in May over a year as compared to 4.2 percent in April. Furthermore, India's fiscal deficit in the first two months of the 2014/15 financial year touched Rs 2.4 lakh crore, or 45.6% of the full-year target of 5.28 lakh crore.  

Hindustan Construction Company (HCC) has surged around 5% to Rs 49, its highest level since January 2011 on BSE on back of heavy volumes. HCC had reported better than expected profit at Rs 24 crore for Q4 FY14 due to efficient project management and tight cost control. Sasken Communication Technologies was locked in upper circuit of 20% at Rs 266 after the company said it has received arbitration award in its favor in the matter of Spreadtrum Communications Inc.

On global front, Asian equity indices were trading in red with Jakarta Stock Index down by 0.10% and Shanghai Composite down by 0.01%. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 7,600 and 25,000 levels respectively. The market breadth on BSE was positive, out of 2,656 stocks traded, 1,692 stocks advanced, while 860 stocks declined on the BSE.

The BSE Sensex is currently trading at 25,483.83 up by 70.05 points or 0.28% after trading in a range of 25,536.22 and 25,466.77. 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 0.59%, while Small cap index up by 1.09%.

The gaining sectoral indices on the BSE were Metal up by 2.47%, Auto up by 2.31%, Realty up by 1.12%, Capital Goods up by 1.11% and Consumer Durables up by 0.98%. On the flip side, IT down by 0.82%, Teck down by 0.31%, Healthcare down by 0.25% and Oil and Gas down by 0.21% were the losing indices on BSE.    

The top gainers on the Sensex were Hindalco Inds up by 6.19%, Maruti Suzuki up by 4.38%, M&M up by 3.29%, SSLT up by 2.57% and Tata Steel up by 2.50%. On the flip side, Wipro  down by 1.20%, TCS down by 1.08%, Infosys down by 0.94%, HDFC down by 0.81% and Sun Pharma down by 0.59% were the top losers on the BSE.

Meanwhile, India’s external debt grew by 7.6 percent to $440.6 billion in the financial year 14 primarily on the back of rise in non-resident deposits. External debt comprises items such as external commercial borrowings, NRI deposits, short-term debt as well as multilateral and bilateral debt. The share of external commercial borrowings (ECBs) continued to be the highest at 33.3 percent ($146.5 billion) followed by NRI deposits at 23.6 percent ($103.8 billion) and short term debt at 20.3 percent ($89.2 billion).

During FY14, NRI deposits rose $33 billion to $103.8 billion mainly driven by special swap scheme introduced by the RBI for commercial banks during September to November 2013 to mobilize FCNR (B) deposits. However, the share of short-term debt total external debt declined 20.3 percent as of March 2014 as compared to 23.6 percent as of March 2013. Further, the ratio of short-term debt to foreign exchange reserves declined to 29.3 percent as of March 2014 from 33.1 per cent as of March 2013. The government or sovereign external debt stood at $81.5 billion as at end-March 2014 as against $81.7 billion as at end-March 2013.

The valuation gain during the reported fiscal amounted to $ 9.4 billion on account of appreciation of the US dollar against the Indian rupee and other major currencies. US dollar denominated debt continued to be the largest component of India's external debt with a share of 61.8 percent as at end-March 2014, followed by Indian rupee (21.1 percent), SDR (6.9 percent), Japanese Yen (5.1 percent) and Euro (3.4 percent).

The CNX Nifty is currently trading at 7,626.35 up by 15.00 points or 0.20% after trading in a range of 7,641.85 and 7,618.15. There were 32 stocks advancing against 18 declining on the index.

The top gainers of the Nifty were Hindalco up by 6.21%, Maruti up by 4.41%, M&M up by 3.32%, SSLT up by 2.55% and Tata Steel up by 2.50%. On the flip side, BPCL down by 1.67%, Asian Paints down by 1.62%, Wipro down by 1.53%, TCS down by 1.44% and Infosys down by 1.31% were the major losers on the index.

Most of the Asian equity indices were trading in red; Nikkei 225 up by 1.11% to 15,331.83 and Taiwan Weighted up by 0.52% to 9,441.92. While, Jakarta Stock Index down by 0.10% to 4,873.69, Shanghai Composite down by 0.01% to 2,048.98 and Straits Times down by 0.58% to 3,236.88