Benchmarks pare some early gains

Indian bourses continued to trade in positive territory in the afternoon session as buying momentum in the equities persisted, however a marginal downfall from day's high levels was seen as sharp selling appeared in some blue chip stocks such as Gail India, HDFC and Coal India. Though, all major sectoral indices were trading in green with realty as the top gaining index up by around 2.43%. Further, the gains in rate sensitive stocks including banking, oil and gas and auto stocks provided support to domestic benchmarks. Sentiments got a boost after the RBI relaxed the financing norms for infrastructure development and affordable housing. There were also some positive announcements like India’s merchandise exports grew at double digits for a second month in a row in June at 10.22% to $26.5 billion and trade deficit contained at $11.76 billion during the month. Sector front, metal stocks were trading in green on the back of encouraging economic data from China. Barring HDFC twins, financial sector stocks were on buyer radar. Buying was broad based with both mid cap and small cap indices were trading up by over 0.90%. Stock specific movement, Marico Kaya Enterprises has surged around 10% to Rs 345 after Morgan Stanley bought over 75,000 shares of the company from the open market.

On global front, Asian equity indices were trading mixed with Hang Seng up by 0.04% and Nikkei 225 down by 0.08% as China reported economic growth that was just ahead of market expectations. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 7,500 and 25,000 levels respectively. The market breadth on BSE was negative, out of 2,488 stocks traded, 1,575 stocks advanced, while 817 stocks declined on the BSE.

The BSE Sensex is currently trading at 25,339.24 up by 110.59 points or 0.44% after trading in a range of 25,377.99 and 25,284.30. There were 18 stocks advancing against 12 stocks declining on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.96%, while Small cap index up by 1.40%.

The gaining sectoral indices on the BSE were Realty up by 2.43%, Bankex up by 1.26%, Oil and Gas up by 0.96%, Auto up by 0.75% and Healthcare up by 0.65%. There were no losing indices on BSE.   

The top gainers on the Sensex were ICICI Bank up by 2.96%, Hindalco Inds up by 1.78%, SBI up by 1.58%, Axis Bank up by 1.45% and Hero Motocorp up by 1.32%. On the flip side, Gail India down by 1.54%, HDFC down by 1.37%, Coal India down by 0.88%, NTPC down by 0.58% and SSLT down by 0.54% were the top losers on the BSE. Meanwhile, in a big step toward funding infrastructure projects in major emerging economies and to head off future economic crises, leaders of the BRICS, group of emerging economies - Brazil, Russia, India, China and South Africa, launched a $100 billion development bank, which will be headquartered in Shanghai, China with the presidency initially held by India. BRICS’s leaders also decided to set up $100 billion currency reserves pool to help countries forestall short-term liquidity pressures.

The long-awaited bank is the first major achievement of the BRICS countries since they got together in 2009 to counter western hold on global finances. However, the negotiations to create the bank dragged on for more than two years as Brazil and India fought China's attempts to get a bigger share in the lender than the others. The development bank will have initial capital of $50 billion that could rise to $100 billion, funded equally by each nation.  Further, the bank is scheduled to start lending in 2016 and be open to membership by other countries, but the capital share of the BRICS cannot drop below 55 percent.

To cushion balance-of-payments difficulties, the contingency currency pool will be held in the reserves of each BRICS country and can be shifted to another member. China, holder of the world's largest foreign exchange reserves, will contribute the bulk of the contingency currency pool at $41 billion. On the other hand, Brazil, India and Russia will provide $18 billion each and South Africa $5 billion. The formation of development bank will also help contain the volatility faced by BRICS nations as a result of the tapering of the United States' policy of monetary expansion.

The CNX Nifty is currently trading at 7,560.90 up by 34.25 points or 0.46% after trading in a range of 7,571.35 and 7,540.35. There were 31 stocks advancing against 19 declining on the index.

The top gainers of the Nifty were IDFC up by 4.77%, ICICI Bank up by 3.00%, DLF up by 1.88%, Jindal Steel up by 1.61% and Hindalco Inds up by 1.55%. On the flip side, HDFC down by 1.41%, Gail down by 1.30%, Coal India down by 0.86%, SSLT down by 0.61% and Ambuja Cement down by 0.57% were the major losers on the index.

Asian equity indices were trading mixed; Hang Seng up by 0.04% to 23,470.17, Jakarta Stock Index up by 1.04% to 5,047.96 and Straits Times up by 0.22% to 3,298.50. While, Nikkei 225 down by 0.08% to 15,382.36, Taiwan Weighted down by 0.88% to 9,484.17 and Shanghai Composite down by 0.28% to 2,064.61