Benchmarks trim gains; trade continues in green

Indian equity benchmarks trimmed minor gains but continued its firm trade in the late afternoon session on account of buying in frontline blue chip counters. The firming trend in Asian markets on the back of Chinese data showing a recovery in the world’s second-largest economy, and value-buying by funds and retail investors after recent sell-off, influenced the sentiments here. Investors were however taking cautious approach ahead of RBI’s policy review scheduled for tomorrow. Traders were seen piling up positions in Consumer Durables, IT and TECK while selling was witnessed in HealthCare sector stocks. In scrip specific development, Syndicate Bank was trading weak after the Central Bureau of Investigation arrested the state-run lender's chairman SK Jain in an alleged bribery case. The shares of Bhushan Steel and Prakash Industries also got beaten down after CBI registered two cases against directors of both the Delhi-based private firms under relevant sections of Prevention of Corruption Act, 1988 and criminal conspiracy.

On the global front, the Asian markets were trading mostly in green, while the European markets too traded mostly on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 7,600 and 25,500 levels respectively. The market breadth on BSE was positive in the ratio of 1662:1051 while 114 scrips remained unchanged.

The BSE Sensex is currently trading at 25585.96, up by 105.12 points or 0.41% after trading in a range of 25688.21 and 25531.38. There were 20 stocks advancing against 10 stocks declining on the index. The broader indices were trading in green; the BSE Mid cap index was up by 0.42%, while Small cap index up by 0.88%.

The gaining sectoral indices on the BSE were Consumer Durables up by 2.04%, IT up by 1.97%, TECK up by 1.66%, Auto up by 1.01% and Capital Goods up by 0.77%. On the other hand, HealthCare down by 0.05% was the sole loser in the space.

The top gainers on the Sensex were Infosys up by 3.66%, Wipro up by 1.88%, Bajaj Auto up by 1.66%, Mahindra & Mahindra up by 1.58% and SSLT up by 1.43%. On the flip side, HDFC down by 1.56%, Coal India down by 1.03%, Cipla down by 0.90%, HDFC Bank down by 0.83% and Bharti Airtel down by 0.54% and were the top losers.

Meanwhile, the government is likely to finalize policy on utilisation of surplus coal from captive mines by the next month. The government has prepared a draft and has been circulated to various ministries/departments for obtaining their comments. The move came after reports of sale of surplus coal by some private parties in open market against norms of captive coal block use.

According to the Coal Mines (Nationalisation) Act, 1973, there is no provision of sale of coal from the coal blocks allotted for captive use. The government can take appropriate action against the allocattee company including de-allocation of the block that violates norms of the use of surplus coal. Recently, the government came to know about the sale of coal in open market from Takli Jena Bellora (South Part) coal block allocated to private firm Central Collieries Company for captive use. Earlier, in the backdrop of the govt's proposed surplus coal policy, Power Ministry has also asked private firms to return excess fuel mined from captive blocks to state-run Coal India.

Coal is dominant fuel used for power production in the country. Coal-fired plants account for 59% of India's installed electricity capacity. In order to enhance the domestic coal production, government has been allocating coal mines to private players. Indian domestic coal demand is presently around 35 percent higher than domestic supply, resulting into a high deficit of which a huge part is being met by costly imports from Indonesia, South Africa and Australia.

The CNX Nifty is currently trading at 7641.40, up by 38.80 points or 0.51% after trading in a range of 7671.70 and 7622.05. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Infosys up by 3.73%, HCL Tech up by 2.58%, United Spirits up by 2.42%, BPCL up by 2.32% and NMDC up by 2.24%. On the flip side, HDFC down by 1.65%, DLF down by 1.37%, ACC down by 1.06%, Coal India down by 0.97% and Cipla down by 0.88% were the top losers.

Asian markets were trading mostly in green; Jakarta Composite rose by 0.11%; KOSPI Index edged higher 0.35%; FTSE Bursa Malaysia KLCI added 0.53%; Shanghai Composite rallied 1.74%; Taiwan Weighted advanced by 0.69%; Hang Seng gained 0.28%. On the flip side, Nikkei 225 lost 0.31% and Straits Times slid 0.82%.

The European markets were trading mostly in green; France’s CAC 40 added 0.19%, UK’s FTSE 100 was up by 0.04% while, Germany’s DAX dropped 0.50%.