Benchmarks trade at record high level; Sensex surpasses 28,000 level

Indian equity benchmarks have made a positive start and are trading at their record high levels with Sensex surpassing 28,000 mark while Nifty is trading tad below its crucial 8,400 level as sentiments remained up-beat ahead of inflation and industrial production to be announced later in the day. IIP data is likely to expand marginally to 0.8 per cent in September, while the CPI inflation should ease to 5.8 per cent in the month of October as compared to 6.3 per cent reported in the month of August. Some support also came in from report that foreign institutional investors were net buyers in Indian equities worth Rs 458.04 crore on November 11, 2014, as per provisional stock exchange data.

On the global front, the US markets ended flat with a positive bias in last session, though the trade remained choppy and bourses lacked direction throughout much of the trading day. Markets also overlooked National Federation of Independent Business data showing that its small business optimism index crept back up to 96.1 in October. The Asian markets were trading mixed at this point of time. Japanese markets was up as investors cheered reports that Prime Minister Shinzo Abe will delay a planned sales tax rise to rejuvenate Japan’s fragile economic recovery, and call a snap election to secure his political position.

On the sectoral front, auto, banking and infrastructure witnessed the maximum gain in trade, while power and metal remained the top losers on the BSE sectoral space. The broader indices too were trading in-line with benchmarks, while the market breadth on the BSE was positive; there were 1332 shares on the gaining side against 741 shares on the losing side while 72 shares remain unchanged.

The BSE Sensex opened at 27958.64; around 48 points higher as compared to its previous closing of 27910.06, and has touched a high and a low of 28090.60 and 27958.64 respectively. The BSE Sensex is currently trading at 28082.79, up by 172.73 points or 0.62%. There were 22 stocks advancing against 8 stocks declining on the index.

The overall market breadth remained in the favour of advances with 62.10% stocks advancing against 34.55% declines. The broader indices were trading in green; the BSE Mid cap index was up by 0.77%, while Small cap index up by 0.64%.

The gaining sectoral indices on the BSE were Auto up by 1.30%, Bankex up by 0.77%, Infrastructure up by 0.54%, FMCG up by 0.53% and IT up by 0.45%, while Power down by 0.29% and Metal down by 0.01% were the only losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 2.42%, Bajaj Auto up by 2.23%, HDFC up by 1.29%, Axis Bank up by 1.22% and ICICI Bank up by 1.18%. On the flip side, Tata Steel down by 0.99%, Cipla down by 0.52%, NTPC down by 0.51%, Sun Pharma down by 0.40% and Hindustan Unilever down by 0.40% were the top losers.

Meanwhile, An inter-ministerial panel is likely to meet on Tuesday to discuss the methodology for fixing reserve price for auction of coal blocks. The committee, comprising secretaries of ministries of finance, power, steel, law, mines, petroleum, industrial policy and promotion and coal, in the meeting would deliberate upon the auction start price or the reserve price for allotting coal blocks, whose allocation was cancelled by the Supreme Court recently.

This development comes after Supreme Court (SC) on September 24 had cancelled allocation of 204 coal blocks to various companies between 1993 and 2009. Out of these, 37 were running coal mines and another five were ready to produce by April, 2015.

Auctions of these cancelled blocks were planned since there were many existing power plants, which were linked to these mines, or power plants, which have no tie-up for coal and would either have cost-plus power purchase agreements or would have contracted agreements to sell electricity on the basis of bid tariff. Nevertheless, the government sensed the need to revise the methodology decided by the IMC previously.

The government had in 2012 constituted an IMC to consider and examine the formulation of methodology for fixing floor/reserve price of coal blocks to be allocated through auction.

However, based on recommendations of consultant Crisil, it proposed allotting coal blocks only to government companies or to power plants with tariff-based bidding, to ensure that the benefit of cheaper domestic coal is passed on to consumers.

The CNX Nifty opened at 8,378.90; around 16 point higher as compared to its previous closing of 8,362.65, and has touched a high and a low of 8,400.95 and 8,377.95 respectively.

The CNX Nifty is currently trading at 8,399.20, up by 36.55 points or 0.44%. There were 31 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 2.60%, Bajaj Auto up by 2.09%, Ambuja Cement up by 1.80%, Axis Bank up by 1.20% and HDFC up by 1.17%. On the flip side, Jindal Steel & Power down by 2.28%, Power Grid down by 2.03%, NMDC down by 1.37%, Tata Steel down by 1.08% and HCL Tech. down by 0.93% were the top losers.

Asian markets were trading mixed; Nikkei 225 soared 272.22 points or 1.59% to 17,396.33, Hang Seng increased by 296.02 points or 1.25% to 23,998.06, KOSPI Index spurted by 9.93 points or 0.51% to 1,972.93 and Jakarta Composite was up by 26.54 points or 0.53% to 5,058.83.

On the flip side, Straits Times dropped 2.43 points or 0.07% to 3,289.72, Shanghai Composite tumbled by 7.51 points or 0.30% to 2,462.16, FTSE Bursa Malaysia KLCI declined by 3.55 points or 0.19% to 1,821.56 and Taiwan Weighted was down by 98.27 points or 1.09% to 8,935.87.