Benchmarks trade higher on firm global cues

Buoyed by firm global cues, Indian equity benchmark have made a positive start and are trading in fine fettle in early deals on Friday. The US markets moved higher in last session although the buying interest was somewhat subdued, but bourses moved higher mainly on the back of some upbeat economic data, including a report from the National Association of Realtors showing that existing home sales unexpectedly rose to a ten-month high in July. The Asian markets too were trading mostly in the green at this point of time, extending their weekly gains with Japanese market headed for a 10th day of gains, the longest winning streak in 26 years.

Back home, sentiments remained up-beat with the Reserve Bank of India (RBI) stating that the Indian economic growth is poised for a take-off amid signs of economic reforms, fiscal consolidation and projected improvement in investments. The central bank forecasts the gross domestic product (GDP) to grow around 5.5% in 2014-15 after two painful years of sub-5% growth. Meanwhile, the rupee is trading at 60.52/53 versus the dollar after hitting 60.49, its highest since July 31 and higher than Thursday’s close of 60.67/68.

On the sectoral front, oil and gas, banking and metal witnessed the maximum gains in trade, while realty remained the lone loser on the BSE sectoral space. The broader indices too were trading with traction, while the market breadth on the BSE was positive; there were 1234 shares on the gaining side against 668 shares on the losing side while 65 shares remain unchanged.

The BSE Sensex opened at 26419.53; around 49 points higher as compared to its previous closing of 26360.11, and has touched a high and a low of 26483.10 and 26419.53 respectively. The BSE Sensex is currently trading at 26457.34, up by 97.23 points or 0.37%. There were 20 stocks advancing against 10 stocks declining on the index.

The overall market breadth remained in the favour of advances with 62.74% stocks advancing against 33.96% declines. The broader indices were trading in green; the BSE Mid cap index was up by 0.50%, while Small cap index up by 0.49%.

The gaining sectoral indices on the BSE were Oil & Gas up by 0.89%, Bankex up by 0.83%, Metal up by 0.80%, PSU up by 0.74% and IT was up by 0.72% while, Realty down by 0.23% was the lone loser on BSE.

The top gainers on the Sensex were Hindalco up by 2.05%, Sesa Sterlite up by 1.83%, SBI up by 1.79%, Axis Bank up by 1.53% and ONGC was up by 1.38%. On the flip side, Sun Pharma Industries down by 1.09%, Bajaj Auto down by 0.98%, HDFC down by 0.85%, Bharti Airtel down by 0.50% and Coal India was down by 0.49% were the top losers.

Meanwhile, With a view to make finance cheaper for weaker sections of the society, the government will soon announce new scheme interest subsidy scheme under which eligibility cap for the 5 percent interest subvention scheme will be enhanced to Rs 5 lakh from the present Rs 1 lakh. 

Under the interest subvention scheme, the government shares the interest burden on a loan for the particular target segment and such schemes presently exist for a slew of sectors including agriculture and sugar.

The move is likely to benefit poor to purchase house as over 58 percent of people from the economically weaker sections and over 39 percent from the low-income groups do not have access to housing. 

Financial Services Secretary G S Sandhu stated that banks cannot go below their cost of funds and to make credit cheaper, the government has to give the interest subsidy. Sandhu also asserted that the government will soon announce affordable housing policy. Banks' ability to finance the housing requirement is constrained by a slew of factors and there is a need to look at alternatives like pension money, insurance companies etc., participating in the sector. He further added that the move to liberalise the taxation regime for the real estate investment trusts (REITs) would be a game changer helping smaller, retail investors to participate in the sector.

The CNX Nifty opened at 7,904.55; around 12 points higher as compared to its previous closing of 7,891.10, and has touched a high and a low of 7,924.90 and 7,903.60 respectively.

The CNX Nifty is currently trading at 7,918.35, up by 27.25 points or 0.35%. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were PNB up by 2.21%, Hindalco up by 2.08%, SBI up by 1.83%, Bank Of Baroda up by 1.78% and Sesa Sterlite was up by 1.69%. On the flip side, United Spirits down by 3.07%, Sun Pharma Industries down by 1.28%, Bajaj Auto down by 0.98%, HDFC down by 0.89% and Power Grid Corporation was down by 0.77% were the top losers.

Asian markets were trading mostly in the green; Shanghai Composite strengthen by 5.34 points or 0.24% to 2,235.80, KOSPI Index Rose by 10.72 points or 0.52% to 2,054.93, Hang Seng added 79.66 points or 0.32% to 25,073.76, Straits Times surged 4.85 points or 0.15% to 3,328.94 and Taiwan Weighted was up  by 120.10 points or 1.30% to 9,373.48.

On the flip side, Nikkei 225  crumbled by 27.83 points or 0.18% to 15,558.37, FTSE Bursa Malaysia KLCI declined by 0.15 points or 0.01% to 1,874.66 and Jakarta Composite was down by 14.26 points or 0.27% to 5,191.87.