Markets maintain the gaining pace led by capital goods and realty stocks

Markets are continuing their momentum with uniform pace and both the major indices were trading up by over a percent in late morning session. There is no sign of profit booking from any corner and the gains are visible across the board. Traders are picking up beaten down stocks at lower valuation, also there was support from the money market with rupee extending its rising streak for the fourth straight day after the dollar weakened overseas. There was some support with a private report saying that Indian industrial output probably bounced in August from a four-month low, driven by solid growth in core industries. While, the broader indices are outperforming the benchmarks, all the sectoral indices are managing to hold their early gains, led by Capital Goods and Realty. There is buzz in the realty stocks on reports that the urban development ministry aims to take up more urban renewal and smart governance projects on public-private partnership (PPP) mode and will attract private players to help develop Smart Cities. While the non sectoral gauge of fertilisers was in jubilant mood for the second straight session after the Fertilizer Ministry notified New Urea Investment Policy for setting up and expansion of urea plants

The BSE Sensex is currently trading at 26539.27, up by 292.48 points or 1.11% after trading in a range of 26394.21 and 26571.66. There were 27 stocks advancing against 3 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.35%, while Small cap index gained 1.48%.

The gaining sectoral indices on the BSE were Capital Goods up by 1.72%, Realty up by 1.67%, Bankex up by 1.52%, Metal up by 1.30%, Power up by 1.26%, while none of the sectoral gauges was in red.

The top gainers on the Sensex were Hindalco up by 5.31%, BHEL up by 3.91%, SBI up by 2.42%, Cipla up by 2.21% and Dr Reddys Lab up by 1.90%. On the flip side, Mahindra & Mahindra down by 0.31%, ITC down by 0.14% and Bajaj Auto down by 0.02% were the top losers.

Meanwhile, with an aim to increase the domestic urea production, the Fertilizer Ministry has notified New Urea Investment Policy for setting up and expansion of urea plants in the country. As per the New Urea Investment Policy, interested private companies are required to give a bank guarantee of Rs 300 crore for every project, while PSUs firms have been exempted from it. However, the companies will get a subsidy on production only if the urea production starts in the next 5 years. The subsidy will continue till 8 years after the commencement of production.

In India, the shortfall between demand and production of urea is around 8 million tonnes which is met through imports. The move to amend the urea policy came after as many as 13 players including IFFCO, RCF and Tata Chemicals proposed setting up of urea plants entailing capacity addition of 16 million tonnes. As earlier policy was assuring the 'guaranteed buyback’, the proposed capacity addition by the applicants was more than the actual requirement. Therefore, the ministry decided to replace guaranteed buyback clause with the Rs 300 crore bank guarantee so that only interested players approach for setting up of new urea projects.

Furthermore, the flexible lower limit and ceiling limit of urea cost has been fixed after factoring the gas price from $6.5 mmbtu to $14 mmbtu. During the implementation of this policy, the decisions on various issues will be taken by a Committee of Secretaries including from Expenditure, Petroleum, Planning Commission and Agriculture.

The CNX Nifty is currently trading at 7929.10, up by 86.40 points or 1.10% after trading in a range of 7886.50 and 7940.70. There were 45 stocks advancing against 5 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 5.51%, BHEL up by 3.83%, PNB up by 2.80%, Bank Of Baroda up by 2.51%, SBI up by 2.48%. On the flip side, Tech Mahindra down by 0.81%, NMDC down by 0.46%, Mahindra & Mahindra down by 0.32%, Bajaj Auto down by 0.15% and ITC down by 0.12% were the top losers.

The Asian markets were showing mixed trend, FTSE Bursa Malaysia KLCI increased by 5.57 points or 0.31% to 1,829.89, Taiwan Weighted was up by 11.09 points or 0.12% to 8,966.27, Straits Times added 25.21 points or 0.78% to 3,251.92, Jakarta Composite gained 45.67 points or 0.92% to 5,004.19 and Hang Seng was higher by 225.21 points or 0.97% to 23,488.54

On the other hand, Nikkei 225 declined by 67.81 points or 0.43% to 15,528.17, KOSPI Index lost 7.66 points or 0.39% to 1,965.25 and Shanghai Composite  was marginally down by 3.64 points or 0.15% to 2,379.15