Markets oscillate in a narrow range; Nifty reclaims 8000 mark

The key equity indices continued to oscillate in a narrow range with a positive bias in late morning session on selective buying by foreign funds and investors amid mixed global cues. Sentiment on the street improved with a World Bank report saying that India’s GDP is likely to expand by 5.6 per cent this fiscal as reforms gain momentum and the growth is expected to accelerate as proposed measures such as GST will give a boost to manufacturing sector. Besides, expectations of encouraging earnings from more companies also supported the upside. However, gains remained capped as some traders remained on the sidelines and refrained from any buying activity ahead of the two-day FOMC meet which begins today.

On the sectoral front, stocks from Capital Goods, Realty and Banking counters were supporting the markets’ uptrend, while those from Metal, Oil & Gas and Power counters were adding to the underlying cautious undertone. In scrip specific development, shares of State Bank of Mysore have rallied after reporting a more than three-fold jump in net profit at Rs 102 crore in the July-September quarter on higher interest income, lower provisions and better recovery from written-off accounts. On the flip side, shares of Astral Poly Technik have declined after reporting nearly 400 bps decline in operating profit margin at 12% during the quarter ended September 2014.

On global front, Asian stocks were trading mostly lower following a lackluster session on Wall Street overnight as investors look ahead to a Federal Reserve decision on its interest rate policy. Back home, Indian rupee depreciated by 6 paise to 61.36 against the dollar in early trade due to month-end demand for the US currency from importers. The market breadth on BSE was positive, out of 2169 stocks traded, 1193 stocks advanced, while 885 stocks declined on the BSE. 

The BSE Sensex is currently trading at 26819.21 up by 66.31 points or 0.25% after trading in a range of 26865.11 and 26785.89. There were 14 stocks advancing against 16 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.27%, while Small cap index gained 0.46%.

The gaining sectoral indices on the BSE were Capital Goods up by 0.69%, Realty up by 0.67%, Bankex up by 0.58%, Consumer Durables up by 0.36% and IT up by 0.18%, while Metal down by 0.71%, Oil & Gas down by 0.69%, Power down by 0.45%, Infrastructure down by 0.36% and FMCG down by 0.07% were the losing indices on BSE.

The top gainers on the Sensex were Sun Pharma Inds. up by 2.09%, GAIL India up by 1.94%, SBI up by 1.68%, ICICI Bank up by 1.58% and HDFC up by 1.21%. On the flip side, Bharti Airtel down by 2.24%, BHEL down by 1.41%, Hindustan Unilever down by 1.23%, ONGC down by 1.17% and Reliance Industries down by 1.09% were the top losers.

Meanwhile, Buoyant over the improving macro-economic fundamentals of the country, World Bank has stated that Indian economy has come back of growth track and is likely to grow by 5.6% in FY15 followed by further acceleration to 6.4% and 7.0% in FY16 and FY17.

In its latest report titled 'India Development Update' the world bank highlighted that measures such as a national Goods and Services Tax (GST), accompanied by a dismantling of inter-state check posts, can be transformational and significantly improve the domestic and international competitiveness of Indian manufacturing firms. Simply halve the delays due to road blocks, tolls and other stoppages could cut freight times by 20-30% and logistics costs by 30-40%, the report added. Road infrastructure alone can boost the competitiveness of India’s key manufacturing sectors by 3 to 4% of net sales, thereby helping India return to a high growth path and enabling large scale job creation. Besides, benign oil prices and stronger performance of Indian firms in the US would also support recovery. However, the World Bank noted that growth projection could face risk from external shocks including financial market disruptions arising out of changes in monetary policies globally, slower global growth and rising oil prices.

Over the past two fiscal years, Indian economic had been struggling with slowdown and its growth stayed below 5% for the second year in a row at 4.7% during FY14. The factors like high interest rate and stubborn inflation, low investments and slow execution of infrastructure projects have impacted country’s economy growth.  However, the economy has shown signs of nascent recovery during the first quarter of current fiscal. India’s economy expanded at its fastest pace in more than two years by 5.7% during Q1FY15 as compared to 4.7% growth recorded in same quarter last year.

The CNX Nifty is currently trading at 8,009.85 up by 18.15 points or 0.23% after trading in a range of 8,020.80 and 7,999.65. There were 25 stocks advancing against 25 declining on the index.

The top gainers on Nifty were Sun Pharma up by 2.09%, Zee Entertainment up by 2.06%, GAIL India up by 1.83%, Ultratech Cement up by 1.62% and SBI up by 1.60%. On the flip side, Bharti Airtel down by 2.88%, Jindal Steel & Power down by 2.85%, BHEL down by 1.84%, Lupin down by 1.45% and Indusind Bank down by 1.26% were the top losers.

Asian markets were trading mostly in the red; Nikkei 225 tumbled by 0.47%, KOSPI Index declined by 0.24%, Straits Times dropped 0.29%, Jakarta Composite dipped 0.41% and FTSE Bursa Malaysia KLCI was down by 0.10%. On the flip side, Hang Seng soared 0.96%, Shanghai Composite spurted by 1.31% and Taiwan Weighted was up by 1.80%.