Markets trade at intra-day’s low; remain well placed into positive territory

Local equity markets, although trading near day’s low, were holding comfortably above the crucial 26,000 (Sensex) and 7,750 (Nifty) levels respectively, with gains of close to quarter of a percent on prevailing optimism ahead of budget combined reports which suggested of overseas investors pumping in a staggering $20.4 billion into the Indian market in the first half of the year. Additionally, sentiments were also buttressed after Brent crude slipped to three -week low as Libya geared up to resume exports from two ports that have been closed for nearly a year. Though, uncertainty about monsoon and negative global cues restricted further upside of the bourses. According to reports, monsoon rainfall continued to be deficient or scanty, with the county receiving rainfall that was 53% less than the 50-year average. Central India and the southern peninsula remained the driest, receiving rainfall that was 74% and 62% less than normal, respectively.

On the global front, Asian stocks showed a mixed performance on speculation over when the Federal Reserve may hike interest rates, leaving investors devoid of any major catalysts after recent gains. Additionally, European shares moved sideways on Monday amid a lack of trading cues and little economic news. The U.S. markets were closed on Friday for the Independence Day public holiday.

Closer home, majority of the sectoral indices on BSE settled into positive territory, however stocks from Banking, Oil & Gas and Fast Moving Consumer Goods counters were the weak links of trade that were restricting further uptick of the bourses. On the flip side, gains of the bourses were led by stocks from Information Technology (IT), Technology and Infrastructure counters were the prominent gainers of the session. Besides, Railway-related stocks are continue at their upward march and trading higher by up to 7% second day in a row ahead of the Railway Budget on Tuesday, July 8. The overall market breadth on BSE was in the favour of advances which thumped declines in the ratio of 975:918; while 20 shares remained unchanged.

The BSE Sensex is currently trading at 26025.82, up by 63.76 points or 0.25% after trading in a range of 26011.57 and 26116.73. 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 0.16%, while Small cap index up by 0.64%.

The gaining sectoral indices on the BSE were IT up by 1.83%, TECK up by 1.51%, Infra up by 1.18%, Power up by 0.60%, Realty up by 0.53% while, Bankex down by 0.92%, Oil & Gas down by 0.80%, FMCG down by 0.25%, PSU down by 0.23%, Metal down by 0.02% were the losing indices on BSE.

The top gainers on the Sensex were Tata Power up by 2.80%, Dr. Reddys Lab up by 2.56%, Infosys up by 2.53%, Bharti Airtel up by 2.23% and TCS up by 1.93%. On the flip side, HDFC Bank down by 1.21%, ONGC down by 1.07%, GAIL India down by 0.92%, ICICI Bank down by 0.78% and Reliance Industries down by 0.73% were the top losers.

Meanwhile, the government has removed the quantitative ceiling on exports of organic sugar in order to help cash-starved sugar industry. Earlier, the government had kept a ceiling of 10,000 tonnes on organic sugar exports.

The Directorate General of Foreign Trade (DGFT), in its notification highlighted that the quantitative ceiling for export of organic sugar has been removed till the time export of sugar is permitted freely. However, Agricultural and Processed Food Products Export Development Authority (APEDA) would permit export of organic sugar subject to registration of quantity with DGFT and certification.

The DGFT has also permitted Indian Sugar Exim Corporation to export of 8,100 tonnes of raw sugar to the US under tariff rate quota (TRQ), a quota for a volume of exports that enter the US at relatively low tariffs. After the quota is reached, a higher tariff is applied on additional imports from India.

India, the second largest producer of sugarcane after Brazil, holds about 5 million hectares of land under sugarcane with an average yield of around 70 tonne per hectare. India produced 25.14 million tonnes of sugar in the crop season ended September 30, 2013, almost 4.5% less than the previous year because of low rainfall in Maharashtra, Karnataka and Tamil Nadu in 2012. The Indian Sugar Mills Association (ISMA) has estimated Indian sugar production at 24 million tonnes for 2013-14.

The CNX Nifty is currently trading at 7767.65, up by 16.05 points or 0.21% after trading in a range of 7759.90 and 7791.40. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were IDFC up by 5.22%, Tata Power up by 2.89%, Dr. Reddys Lab up by 2.62%, Infosys up by 2.44% and Bharti Airtel up by 2.14%. On the flip side, Kotak Mahindra Bank down by 2.10%, United Spirits down by 1.74%, Ultratech Cement down by 1.58%, HDFC Bank down by 1.24% and GAIL India down by 1.10% were the top losers.

Most of the Asian equity indices were trading mixed; FTSE Bursa Malaysia KLCI increased 6.14 points or 0.33% to 1,891.05, Straits Times increased 6.96 points or 0.21% to 3,279.21, Taiwan Weighted increased 10.15 points or 0.11% to 9,520.20 and Jakarta Composite increased 60.92 points or 1.24% to 4,966.75. On the flip side, Nikkei 225 decreased 57.69 points or 0.37% to 15,379.44, Hang Seng decreased 17.07 points or 0.07% to 23,529.29, KOSPI Index decreased 4.54 points or 0.23% to 2,005.12 and Shanghai Composite decreased 0.18 points or 0.01% to 2,059.20.

European markets got off to a negative start; with Germany’s DAX sliding by 0.19% to 9,989.93, France’s CAC dropping 0.38% to 4,451.85 and UK’s FTSE 100 slipping by 0.05% to 6,862.48.