Benchmarks trade jubilantly in early deals on firm global cues

Coming out from consolidation mood, Indian equity benchmarks have made a gap-up opening and are trading jubilantly in early deals on penultimate session of August F&O series. Sentiments remained buoyed by firm global cues as the US markets ended in green with S&P topping 2000 level for the first time on closing basis, on the back of strong economic data and a flurry of merger news. Consumer confidence in the US improved for the fourth consecutive month in August. Asian markets too were trading mostly in the green at this point of time. Though, the initial gains were modest but traders were getting support with strength of the world’s largest economy after good durable goods and consumer confidence data.

Back home, sentiments remained up beat after Oil Ministry said that it will seek Cabinet nod for freeing diesel prices after retail rates achieve parity with global levels, and has proposed to cut subsidy payout by upstream firms like ONGC and Oil India by half. Banking stocks too remained on buyers’ radar after the State Bank of India and HDFC brought down home loan rates, compelling others to follow suite. Additionally, companies related to defence supply edged higher, as the government has notified increase in foreign direct investment (FDI) limit to 49 percent through approval route in the defence sector.

On the sectoral front, consumer durables, auto and realty witnessed the maximum gains in trade, while infrastructure, power and metal remained the top losers on the BSE sectoral space. The broader indices too were in-line with benchmarks, while the market breadth on the BSE was negative; there were 1329 shares on the gaining side against 594 shares on the losing side while 53 shares remain unchanged.

The BSE Sensex opened at 26553.24; around 111 points higher as compared to its previous closing of 26442.81, and has touched a high and a low of 26599.12 and 26549.75 respectively. The BSE Sensex is currently trading at 26571.09, up by 128.28 points or 0.49%. There were 27 stocks advancing against 3 stocks declining on the index.

The overall market breadth remained in the favour of advances with 67.26% stocks advancing against 30.06% declines. The broader indices were trading in green; the BSE Mid cap index was up by 0.87%, while Small cap index up by 1.00%.

The gaining sectoral indices on the BSE were Consumer Durables up by 1.19%, Auto up by 1.05%, Realty up by 0.92%, Bankex up by 0.72% and Oil & Gas was up by 0.72% while, Infrastructure down by 0.20%, Power down by 0.18% and Metal was down by 0.01% were the few losing indices on BSE.

The top gainers on the Sensex were Bajaj Auto up by 2.02%, ONGC up by 1.97%, Dr. Reddys Lab up by 1.68%, SBI up by 1.34% and ICICI Bank was up by 1.20%. On the flip side, NTPC down by 1.56%, Hindalco down by 1.03% and GAIL India was down by 0.88% were the few losers.

Meanwhile, with an aim to enhance the country’s exports, the government will revive the export interest subsidy scheme, which expired in March 2014. It has already made budgetary provision of over Rs 1,600 crore for the export interest subsidy.

Commerce ministry is presently in discussion with the finance ministry and selecting the sectors that would be covered by the scheme in the new five-year policy expected to be announced at the end of September.

The Foreign Trade Policy (FTP), which governs all exports and imports related activities in India, ended on March 31 and the new government will introduce new FTP for the period 2014-19 in September 2014. In the previous trade policy, the benefit of interest subsidy was earlier available to sectors such as micro small and medium enterprises, handlooms, handicraft, carpets, toys, sports goods, processed products, certain engineering and textiles goods. The export interest subsidy helped increase the competitiveness of goods on global level.

The new FTP is likely to promote exports of specific products in specific geographies, job-creating manufacturing sectors and would also abolish conventional method of exports by focusing more on areas like branding of products in the global markets, exports of services and hi-tech products and new strategy for marketing.

The CNX Nifty opened at 7,933.90; around 29 points higher as compared to its previous closing of 7,904.75, and has touched a high and a low of 7946.85 and 7932.40 respectively.

The CNX Nifty is currently trading at 7939.75, up by 35 points or 0.44%. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were ONGC up by 1.97%, HCL Tech up by 1.96%, Bajaj Auto up by 1.86%, Dr. Reddys Lab up by 1.62% and ICICI Bank was up by 1.38%. On the flip side, NTPC down by 1.74%, GAIL India down by 1.13%, Hindalco down by 1.09%, Kotak Mahindra Bank down by 0.96% and Power Gridwas down by 0.95% were the top losers.

Asian markets were trading mostly in the green; KOSPI Index rose by 3.47 points or 0.17% to 2,071.52, Shanghai Composite strengthens by 5.01 points or 0.23% to 2,212.12, Jakarta Composite jumped by 18.57 points or 0.36% to 5,165.12. Taiwan Weighted gained by 79.97 points or 0.85% to 9,473.93, FTSE Bursa Malaysia KLCI surged by 6.64 points or 0.36% to 1,868.46 and Straits Times was up 16.27 points or 0.49% to 3,339.29.

On the flip side, Nikkei 225 tumbled by 27.13 points or 0.17% to 15,494.09 and Hang Seng was down 7.32 points or 0.03% to 25,067.18.