Benchmarks trim losses; trade continues in green

Indian equity benchmarks trimmed losses and started trading in green in the late afternoon session on account of buying in frontline blue chip counters. Investors were however cautious on renewed tensions in Ukraine, along with debt concerns in Argentina and Portugal, which weighed on risk-appetite of investors across the globe. Traders were seen piling up positions in Oil & Gas, Realty and PSU while selling was witnessed in IT and TECK sector stocks. In scrip specific development, hectic activity was witnessed in stocks of companies associated with the railways, a day after 100% Foreign Direct Investment (FDI) in railway infrastructure was approved by the cabinet. Jindal Steel & Power (JSPL) was trading in green on strong improvement in overall numbers in April-June quarter.

On the global front, the Asian markets were trading mostly in red, while the European markets too traded on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 7,750 and 25,800 levels respectively. The market breadth on BSE was negative in the ratio of 1305:1473 while 126 scrips remained unchanged.

The BSE Sensex is currently trading at 25765.62, up by 100.35 points or 0.39% after trading in a range of 25538.76 and 25778.05. There were 21 stocks advancing against 9 stocks declining on the index. The broader indices were trading mixed; the BSE Mid cap index was down by 0.07%, while Small cap index up by 0.08%.

The gaining sectoral indices on the BSE were Oil & Gas up by 1.02%, Realty up by 0.88%, PSU up by 0.84%, Metal up by 0.80%, Bankex up by 0.77% while, IT down by 0.74%, TECK down by 0.59% were the losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 1.89%, Coal India up by 1.62%, ONGC up by 1.49%, BHEL up by 1.44% and Dr. Reddy’s Lab up by 1.40%. On the flip side, Infosys down by 1.08%, TCS down by 0.97%, Tata Motors down by 0.63%, Sun Pharma Industries down by 0.51% and Hindalco down by 0.37% were the top losers.

Meanwhile, Power and coal minister Piyush Goyal has asserted that in order to help raise electricity generation in the country, Coal India (CIL) will reduce the volume of coal offered through e-auctions by almost 50%.

Coal shortage in the country has become a concern for Indian power sector as coal-fired plants account for 59% of India's installed electricity capacity. Further, power companies need long-term supply assurances from coal producers, thus e-auctions do not fit to their plans. Further, the Minister added that the government is formulating plan for rationalising coal linkages in order to improve efficiency. Currently, coal linkages in the country are completely irrational as fuel is being transported from a far-off place to power plants, which already has nearby coal sources. Piyush Goyal further said that government is making all efforts to increase coal production in the country and presently a study is being carried out on around 200 mines and a report on the same would be ready by Aug 31. Goyal said that the government is mulling a more robust financial restructuring plan to improve the financial health of power distribution companies.

CIL is the only producer of coal in the country and is struggling to meet domestic coal requirements. 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. The government has set coal production target at 507 million tonnes for CIL for FY15.

The CNX Nifty is currently trading at 7705.45, up by 33.40 points or 0.44% after trading in a range of 7638.70 and 7708.90. There were 35 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were Jindal Steel & Power up by 4.77% and ACC up by 3.13% and Tata Steel up by 1.92% and Coal India up by 1.76% and Kotak Mahindra Bank up by 1.71%. On the flip side, HCL Tech down by 1.66%, Infosys down by 1.14%, TCS down by 0.92%, PNB down by 0.86% and Asian Paints down by 0.78% were the top losers.

Asian markets were treading mostly in red; Hang Seng decreased 196.57 points or 0.8% to 24,387.56; Shanghai Composite decreased 29.8 points or 1.34% to 2,187.67; Taiwan Weighted decreased 12.53 points or 0.14% to 9,131.44; Straits Times decreased 11.98 points or 0.36% to 3,308.25; KOSPI Index decreased 6.22 points or 0.3% to 2,054.51 and FTSE Bursa Malaysia KLCI decreased 4.59 points or 0.25% to 1,865.33.

On the other hand, Jakarta Composite increased 0.76 points or 0.01% to 5,058.98 and Nikkei 225 increased 72.58 points or 0.48% to 15,232.37.

The European markets were trading in red; UK’s FTSE 100 decreased 16.82 points or 0.25% to 6,619.34, France’s CAC decreased 6.77 points or 0.16% to 4,200.37 and Germany’s DAX decreased 3.11 points or 0.03% to 9,126.93.