Benchmarks continue to hold their head above water

After getting a cautious but positive start, benchmarks continued to hold their head above water on selective buying by funds and retail investors. Sentiment on the street improved on report that heavy showers across north and northwest India, narrowed the overall monsoon deficit in the country to 14% and has accelerated crop growth. Some support also came in from reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 1,698 crore on September 04, 2014. Holding slender gains, both Sensex and Nifty were trading above the crucial 27,100 and 8,100 levels respectively. However, a weakening trend on the other Asian markets following overnight losses on the US bourses, limited the gains on the domestic markets.

Meanwhile, gains at Dalal Street were led by stocks belonging from Consumer Durables, IT and Capital Goods counters. Additionally, Software stocks gained on continued hopes of better business in the U.S. and Europe on recent positive macro data. On the flip side, stocks from Healthcare, FMCG and Power counters witnessing brutal thrashing, were restricting further upside of the markets.

In scrip specific development, shares of Larsen & Toubro rose after the company won a Rs 5100 crore Supercritical Power Plant Order from MP State Utility, 1320 MW Plant to be executed on EPC Basis Under Stringent Schedule. Furthermore, Tech Mahindra has gained by nearly 2% after the company signed an agreement with Bombardier Aerospace. On the other hand, JP Associates has extended losses for the second consecutive day and has dipped by over 10% after Jaypee Infra Ventures sold over 13 million shares on the National Stock Exchange.

On global front, most of Asian stock markets fell, with the regional benchmark index heading for a second day decline, as material companies slid. Also, US stocks ended lower as profit taking in oil shares pared intra-day gains after the European Central Bank lowered its key policy rate. Back home, Indian rupee fell by 7 paise to 60.43 against the US dollar in early trade at the Interbank Foreign Exchange market due to increased demand for the US currency from importers. The market breadth on BSE was positive, out of 2330 stocks traded, 1459 stocks advanced, while 785 stocks declined on the BSE. 

The BSE Sensex is currently trading at 27119.19 up by 33.26 points or 0.12% after trading in a range of 27178.80 and 27095.03. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.70%, while Small cap index gained 0.99%.

The gaining sectoral indices on the BSE were Consumer Durables up by 0.98%, IT up by 0.81%, Capital Goods up by 0.76%, Oil & Gas up by 0.69% and PSU up by 0.54%, while Healthcare down by 0.18%, FMCG down by 0.07%, Power down by 0.06% and Auto down by 0.02% were the losing indices on BSE.

The top gainers on the Sensex were GAIL India up by 1.70%, ONGC up by 1.30%, Larsen & Toubro up by 1.19%, TCS up by 0.93% and SBI up by 0.84%. On the flip side, Coal India down by 1.55%, HDFC down by 1.50%, BHEL down by 1.21%, Bharti Airtel down by 1.10% and Hero MotoCorp down by 0.99% were the top losers.

Meanwhile, In what could be potentially big development for world's largest postal service India Post, Communication and IT Minister, Ravi Shankar Prasad, asserted that country’s postal service would be the best suited to offer delivery services to e-commerce players.

The Minister also emphasized upon the need to expose young officers to the latest developments and emerging trends in the postal and logistics sectors. He further highlighted that the digital India project, which aims to make broadband facility available in every village across the country, would turbo-drive e-commerce business in villages, for which it felt that services of India’s Post were best suited for, given its unparalleled rural reach. India Post has over 1.55 lakh post offices of which more than 1.39 lakh are in the rural areas. On an average, a post office serves an area of 21.21 square km and a population of 7,175 people.

However, as per few market reports, ‘last-mile delivery’ of products ordered by online shoppers could feature as one of the major deciding factors for e-commerce firms like Flipkart, Snapdeal, Amazon, etc. Presently, firms are already offering one-day delivery and this could further intensify with firms investing hugely in logistics to ramp up their delivery system.

According to Prasad, Post Office could also become a focal point for delivering not only government services, but also e-services to the people as in e-service centres, apart from commercially remunerative services for corporate/private players including conducting market surveys, information dissemination, etc.

The CNX Nifty is currently trading at 8,109.35 up by 13.40 points or 0.17% after trading in a range of 8,122.70 and 8,099.90. There were 33 stocks advancing against 17 declining on the index.

The top gainers on Nifty were NMDC up by 3.60%, DLF up by 2.03%, GAIL up by 1.98%, Asian Paints up by 1.61% and ONGC up by 1.23%. On the flip side, Coal India down by 1.86%, United Spirits down by 1.82%, HDFC down by 1.55%, BHEL down by 1.34% and Hero MotoCorp down by 1.07% were the top losers.

Asian markets were trading mostly in the red; FTSE Bursa Malaysia KLCI 0.03%, Taiwan Weighted declined by 0.57%, Straits Times shed 0.60%, KOSPI Index contracted by 0.33% and Hang Seng was down by 0.28%. On the flip side, Nikkei 225 surged by 0.06%, Jakarta Composite gained by 0.12% and Shanghai Composite was up by 0.34%.