Benchmarks continue firm trade; Nifty holds 7950 mark

Indian equity markets continued their firm trade in the late afternoon session on account of buying in frontline blue chip counters. The optimism on the street was buoyed by a rally in global markets and positive momentum from the reform measures announced by the government. The optimism was also triggered by speculation that Europe’s central bank would add stimulus. Traders were seen piling positions in Auto, Capital Goods and Consumer Durables while selling was witnessed in PSU and Realty sector stocks. In scrip specific development, KPIT Technologies was trading firm after the software services firm reported a 39% sequential growth in profit and 128 basis points expansion in operating profit margin. The market will be open for Muhurat trading session at 18:30 tomorrow i.e. October 23, 2014. The markets will remain close on Friday i.e. October 24, 2014, on account of Diwali.

On the global front, the Asian markets were trading mostly in green while the European markets were trading mostly on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 7,950 and 26,700 levels respectively. The market breadth on BSE was positive in the ratio of 1582:1001 while 109 scrips remained unchanged.

The BSE Sensex is currently trading at 26759.44, up by 183.79 points or 0.69% after trading in a range of 26712.21 and 26818.33. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.90%, while Small cap index up by 1.03%.

The gaining sectoral indices on the BSE were Auto up by 2.66%, Capital Goods up by 1.74%, Consumer Durables up by 1.03%, TECK up by 0.87%, IT up by 0.79% while, PSU down by 0.60%, Realty down by 0.11% were the losing indices on BSE.

The top gainers on the Sensex were Hero MotoCorp up by 3.70%, Tata Motors up by 3.25%, Bajaj Auto up by 3.08%, Maruti Suzuki up by 2.62% and Mahindra & Mahindra up by 2.52%. On the flip side, ONGC down by 2.38%, Coal India down by 0.70%, ITC down by 0.57%, NTPC down by 0.37% and ICICI Bank down by 0.35% were the top losers.

Meanwhile, as gold imports are witnessing a sudden spike over the past few months, the government is planning to impose some restrictions on yellow metal imports after Diwali. Inward shipments of gold increased by 450% y-o-y to $3.75 billion during September 2014. High gold imports pushed trade deficit to 16-month high at $14.25 billion in September as compared to $10.84 in August and $6.12 billion in the same month previous year.

In September 2013, the government imposed restrictions such as high custom duty and 80/20 rule to check the gold imports. However, in May, the government partly relaxed the gold norms by permitting nine premium and star trading companies to import gold along with banks and nominated trading agencies like MMTC and STC. Since then, Indian gold import has been increasing. Quantity wise, gold imports which averaged 10-15 tonnes till June, increased to 38.3 tonnes in July, 63 tonnes in August and 92 tonnes in September.

Commerce Ministry is likely to organize a meeting with the RBI’s representatives and stakeholders of bullion and gold industry to discuss gold imports issue. The meeting is likely to deliberate on restricting again the premium and star trading companies from gold imports following the complaints received by the domestic bullion industry.  As per the import norms, 20% of gold imports have to be exported. Gold jewellery and bullion industry have suggested the government that their business has affected by premium and star trading firms as these firms are not selling imported gold to them for further exports.

The CNX Nifty is currently trading at 7988.65, up by 60.90 points or 0.77% after trading in a range of 7974.55 and 7999.30. There were 38 stocks advancing against 12 stocks declining on the index.

The top gainers on Nifty were Kotak Mahindra Bank up by 4.60%, Hero MotoCorp up by 3.71%, Tata Motors up by 3.33%, Bajaj Auto up by 3.15% and Cairn India up by 2.86%. On the flip side, DLF down by 2.72%, ONGC down by 2.35%, NMDC down by 1.04%, Coal India down by 0.72% and ICICI Bank down by 0.66% were the top losers.

The Asian markets were trading mostly in green; KOSPI Index increased 21.69 points or 1.13% to 1,936.97, Jakarta Composite increased 43.34 points or 0.86% to 5,072.68, Taiwan Weighted increased 94.19 points or 1.09% to 8,748.83, Hang Seng increased 315.39 points or 1.37% to 23,403.97, Nikkei 225 increased 391.49 points or 2.64% to 15,195.77.

On the other hand, Shanghai Composite decreased 13.1 points or 0.56% to 2,326.55 and FTSE Bursa Malaysia KLCI decreased 6.92 points or 0.38% to 1,796.22. Singapore Stock Exchange was closed today on account of ‘Deepavali’ holiday.

The European markets were trading mostly in red; UK’s FTSE 100 decreased 20.79 points or 0.33% to 6,351.54, France’s CAC decreased 7.06 points or 0.17% to 4,074.18 while, Germany’s DAX increased 9.28 points or 0.1% to 8,896.24.