Benchmarks extend gains; Metal, Capital goods lead

Indian equity benchmarks added gains to continue firm trade hovering near the highest point of the day in the late afternoon session on account of buying in frontline blue chip counters. The sentiments got some support after India’s wholesale price inflation in July eased to a five-month low of 5.19%, helped mainly by a moderation in fuel costs. In June, wholesale prices rose 5.43% year-on-year, their slowest pace in four months. Traders were seen piling up positions in Metal, Capital Goods and Bankex while selling was witnessed in IT and TECK sector stocks. In scrip specific development, Dabur India, the personal care products manufacturer, was trading firm while two-wheeler maker Hero Motocorp was trading in red after MSCI made change in weightages of stocks in its India Index.

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 26,100 levels respectively. The market breadth on BSE was positive in the ratio of 1473:1262 while 101 scrips remained unchanged.

The BSE Sensex is currently trading at 26104.07, up by 185.12 points or 0.71% after trading in a range of 25945.35 and 26106.96. There were 23 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.07%, while Small cap index up by 0.85%.

The gaining sectoral indices on the BSE were Metal up by 1.72%, Capital Goods up by 1.56%, Bankex up by 1.40%, Realty up by 1.33%, Consumer Durables up by 1.23% while, IT down by 0.03%, TECK down by 0.03% were the losing indices on BSE.

The top gainers on the Sensex were Sesa Sterlite up by 2.98%, GAIL India up by 2.81%, Tata Motors up by 2.45%, ICICI Bank up by 2.30% and HDFC Bank up by 2.11%. On the flip side, Hero MotoCorp down by 2.69%, HDFC down by 1.67%, Hindustan Unilever down by 0.74%, Wipro down by 0.66% and Bharti Airtel down by 0.62% were the top losers.

Meanwhile, extending its easing trend, India's main inflation gauge, based on monthly WPI, softened to five months low of 5.19% for the month of July as compared to 5.43% in the previous month and 5.85% during the corresponding month of the previous year. The figure was much in-line street expectations, which were expecting headline inflation to be in the range of 5.15%-5.19% for the month under review. Meanwhile, May inflation figures were revised upwards to 6.18% from 6.01% earlier.

The five-month low inflation data was mainly on account of moderation in fuel costs. Fuel & Power index, which occupies 14.91% weight in the overall index, rose by 1.1% to 214.7 (provisional) from 212.3 (provisional) for the previous month due to higher price of petrol and furnace oil (3% each), bitumen and high speed diesel (2% each) and aviation turbine fuel (1%). Meanwhile, the index of Manufactured Products, which occupies the majority 64.97% weight in WPI index, rose by 0.3% to 155.4 (provisional) from 154.9 (provisional) in June.

However, Primary Articles index, which occupies 20.12% weight in the overall headline index, also rose 2.7% to 256.6 (provisional) from 249.9 (provisional) for the previous month. Out of the index, 'Food Articles’ group rose by 3.6% to 258.6 (provisional) from 249.7 (provisional) for the previous month, while index for  ‘Non-Food Articles’  group rose by 0.8% to 218.1 (provisional) from 216.4  (provisional) for the previous month.

In an encouraging development, core inflation also softened to 3.32% v/s 3.49% in June. However on concern side, inflation in the overall food articles basket, stood at 8.43% as compared to 8.14 % in June. The Reserve Bank in its monetary policy review last week had cautioned that continued uncertainty over monsoon could stoke food inflation, but expressed the hope that government policies will improve supplies in the coming months.

The CNX Nifty is currently trading at 7786.00, up by 46.45 points or 0.60% after trading in a range of 7739.10 and 7786.55. There were 39 stocks advancing against 11 stocks declining on the index.

The top gainers on Nifty were Jindal Steel & Power up by 2.94%, Sesa Sterlite up by 2.70%, GAIL India up by 2.45%, ICICI Bank up by 2.39% and Tata Motors up by 2.31%. On the flip side, Hero MotoCorp down by 2.61%, HDFC down by 2.14%, HCL Tech down by 1.91%, Wipro down by 1.03% and Bajaj Auto down by 0.70% were the top losers.

The Asian markets were trading mostly in red; Hang Seng decreased 88.98 points or 0.36% to 24,801.36, Jakarta Composite decreased 31.49 points or 0.61% to 5,136.78, Shanghai Composite decreased 16.41 points or 0.74% to 2,206.47, Straits Times decreased 8.51 points or 0.26% to 3,292.90 and Taiwan Weighted decreased 0.7 points or 0.01% to 9,230.61.

On the other hand, FTSE Bursa Malaysia KLCI increased 0.8 points or 0.04% to 1,858.84, KOSPI Index increased 0.86 points or 0.04% to 2,063.22 and Nikkei 225 increased 100.94 points or 0.66% to 15,314.57.

The European markets were trading mostly in red; Germany’s DAX decreased 31.62 points or 0.34% to 9,167.26, France’s CAC decreased 14.52 points or 0.35% to 4,180.27 while, UK’s FTSE 100 increased 12.26 points or 0.18% to 6,668.94.