Markets trade flat-to-positive in early deals

Indian equity benchmarks are trading flat-to-positive in early deals on Monday with frontline gauges managing to hold their crucial 26,850 (Sensex) and 8,000 (Nifty) levels. Buying in coal and power related stocks aided the sentiments as the Coal Ministry is gearing up to prepare the modalities of the proposed e-auction of coal blocks that may take place in January next year. Moreover, select shares from oil and gas sector edged higher on reports that Oil Minister Dharmendra Pradhan plans to overhaul the exploration policy to attract investors, spur energy output and revive the economy. However, gains remained capped on report that foreign institutional investors (FIIs) were net sellers to the tune of Rs 12.38 crore on Thursday.

The US markets ended higher on Friday, extending their upward trend and reflecting a positive reaction to earnings news from big-name companies. The Asian markets were trading mixed at this point of time, though some of the indices are recovering from their lows as a stress test passed by most European banks added to signs of recovery in the region.

On the sectoral front, banking, capital goods and power witnessed the maximum gain in trade, while realty, auto and technology remained the top losers on the BSE sectoral space. The broader indices were reeling under pressure, while the market breadth on the BSE was positive; there were 1042 shares on the gaining side against 945 shares on the losing side while 81 shares remain unchanged.

The BSE Sensex opened at 26959.57; around 108 points higher as compared to its previous closing of 26851.05, and has touched a high and a low of 26994.96 and 26851.12 respectively. The BSE Sensex is currently trading at 26879.70, up by 28.65 points or 0.11%. There were 13 stocks advancing against 17 stocks declining on the index.

The overall market breadth remained in the favour of advances with 70.03% stocks advancing against 26.50% declines. The broader indices were trading in red; the BSE Mid cap index was down by 0.17%, while Small cap index down by 0.03%.

The gaining sectoral indices on the BSE were Bankex up by 0.78%, Capital Goods up by 0.73%, Power up by 0.48%, PSU up by 0.25% and Healthcare up by 0.09%  while, Realty down by 2.62%, Auto down by 1.06%, TECK down by 0.43%, Metal down by 0.28% and IT down by 0.27% were the losing indices on BSE.

The top gainers on the Sensex were BHEL up by 2.98%, GAIL India up by 2.39%, Dr. Reddys Lab up by 2.38%, HDFC up by 1.73% and SBI up by 1.13%. On the flip side, Tata Motors down by 1.98%, Mahindra & Mahindra down by 1.64%, Bajaj Auto down by 0.95%, ONGC down by 0.90% and Hero MotoCorp down by 0.90% 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 opened at 8,064.35; around 50 points higher as compared to its previous closing of 8,014.55, and has touched a high and a low of 8,064.40 and 8,014.30 respectively.

The CNX Nifty is currently trading at 8022.55, up by 8.00 points or 0.10%. There were 20 stocks advancing against 29 stocks declining on the index.The top gainers on Nifty were Indusind Bank up by 3.45%, BHEL up by 3.00%, GAIL India up by 2.26%, Dr. Reddys Lab up by 2.23% and HDFC up by 1.78%. On the flip side, DLF down by 6.34%, Jindal Steel & Power down by 5.73%, Cairn India down by 2.32%, HCL Tech down by 2.12% and Zee Entertainment down by 1.99% were the top losers.

Asian markets were trading mixed; Hang Seng dipped 196.58 points or 0.84% to 23,105.62, Straits Times declined by 1.57 points or 0.05% to 3,220.98, Jakarta Composite slipped 16.99 points or 0.33% to 5,056.08, Shanghai Composite dropped 14.64 points or 0.64% to 2,287.64 and Taiwan Weighted was down by 10.08 points or 0.12% to 8,635.93.

On the flip side, Nikkei 225 gained 115.64 points or 0.76% to 15,407.28, KOSPI Index increased by 7.57 points or 0.39% to 1,933.26 and FTSE Bursa Malaysia KLCI was up by 4.29 points or 0.24% to 1,823.15.