Markets continue to trade in positive territory

Indian equity benchmarks continued to trade in positive territory in afternoon session on the back of buying witnessed in IT, power and teck stocks amid mixed global cues. Sentiment got a boost as FICCI's Business Confidence index value climbed to a 14-quarter high of 69 in the current round up from 60.8 in the previous survey. Further, there are optimisms among investors that the government will take measures in budget 2014-15 to boost the business sentiments in the country. Most of the sectoral indices were trading in green with IT as the top gaining index up by around 1.93% on BSE. Buying was broad based with both mid cap and small cap indices trading up by over 0.20%. Railway-related stocks continued their upward march second day in a row ahead of the Railway Budget on Tuesday, July 8. Further, sugar stocks were also on buyer radar as the government removed quantitative ceiling on exports of organic sugar in order to help cash-starved sugar industry. However, oil and gas sector’s stocks were trading in red.

IDFC has surged by almost 4% after brokerage upgrades the stock to overweight from underweight and raises its target price to Rs 175 from Rs 115. Reliance Communications has gained nearly 2% to Rs 144 after index provider FTSE raises the weightage of the stock in its index.

On global front, Asian equity indices were trading mixed with Hang Seng down by 0.15% and Straits Times up by 0.11%. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 7,700 and 26,000 levels respectively. The market breadth on BSE was positive, out of 2,748 stocks traded, 1,565 stocks advanced, while 1,093 stocks declined on the BSE.

The BSE Sensex is currently trading at 26,053.56 up by 91.50 points or 0.35% after trading in a range of 26,116.73 and 26,011.57. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.23%, while Small cap index up by 0.69%.

The gaining sectoral indices on the BSE were IT up by 1.93%, Teck up by 1.61%, Power up by 0.75%, Healthcare up by 0.73% and Auto up by 0.54%. On the flip side, Bankex down by 0.65%, Oil and Gas down by 0.63%, FMCG down by 0.12% and Consumer Durables down by 0.04% were the losing indices on BSE.  

The top gainers on the Sensex were Tata Power up by 3.08%, Dr Reddy’s Lab up by 2.89%, Infosys up by 2.43%, TCS up by 2.21% and Bharti Airtel up by 1.95%. On the flip side, HDFC Bank down by 0.96%, ONGC down by 0.92%, RIL down by 0.55%, Gail India down by 0.53% and HDFC down by 0.48% were the top losers on the BSE.

Meanwhile, India`s import of coal rose 12 percent to 18.5 million tonnes in June from a year earlier. Coal import in the month of June was highest in 2014 and mainly driven by prevailing low global coal prices due to low demand in China and other major European countries. India’s imports coal from countries like Indonesia, Australia and South Africa.

Furthermore, sluggish domestic production was also responsible for high coal imports. Presently, Coal India (CIL) is the only producer of domestic coal accounting for around 80 percent of the domestic production. CIL is struggling to meet domestic coal requirements and dug out only 34.54 million tonnes coal in June, which was 6 percent less than expected. Moreover, CIL production fell 4.21 percent short of its production target to 462.53 million tonnes in FY14 amid concerns like shutdown of mining activities in Talcher Coalfields in Odisha. In the near term, coal imports would continue to rise because of prevailing attractive prices and possibility of further softness in international prices.

Currently, Indian domestic coal demand is around 35 percent higher than domestic supply. Acute coal shortages in the country have become primary reason for power deficit as coal-fired plants account for 59% of India's installed electricity capacity. 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 is currently trading at 7,774.20 up by 22.60 points or 0.29% after trading in a range of 7,791.40 and 7,759.90. There were 31 stocks advancing against 19 declining on the index.

The top gainers of the Nifty were IDFC up by 4.14%, Tata Power up by 3.22%, Dr Reddy’s Lab up by 2.93%, TCS up by 2.32% and Infosys up by 2.21%. On the flip side, Kotak Bank down by 2.85%, Ultra Tech Cement down by 1.61%, BPCL down by 1.38%, McDowell down by 1.13% and HDFC Bank down by 1.06% were the major losers on the index.

Most of the Asian equity indices were trading mixed; Hang Seng down by 0.15% to 23,512.01, Nikkei down by 0.24% to 15,399.52, Shanghai Composite down by 0.13% to 2,056.61. While, Straits Times up by 0.11% to 3,275.81, Jakarta Stock Index up by 0.97% to 4,953.24 and Taiwan Weighted up by 0.11% to 9,520.20