Benchmarks continue to trade in green in late morning session

After getting a cautious but positive start, benchmarks continued to trade in green in late morning session on sustained foreign fund inflows and positive economic data as retail inflation eased to 5.52 per cent in October and industrial production grew at 2.5 per cent in September. Domestic sentiment was buoyed on report that India would have the fastest economic expansion among Asian countries and its gross domestic product is expected to grow by 6.3% in 2015.  Besides, falling global crude oil prices influenced trading sentiments. The slump in crude prices will lead to a substantial decline in India's import bill. This means lower fiscal deficit and further easing in inflation. Some support also came in from reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 690.61 crore on November 13, 2014. However, a weakening trend on the other Asian markets, limited the gains on the domestic markets. There was also some cautiousness among investors ahead of Wholesale Price Index (WPI)-based inflation data due later in the day.

Barring Healthcare, all other BSE sectoral indices were trading significantly in the green. Among them, Oil & Gas index gained 1.28 per cent, followed by PSU up by 1.13 per cent and Realty up by 1.12 per cent. In scrip specific development, shares of Alstom T&D India have rallied after reporting a robust 71% year-on-year jump in net profit to Rs 35.52 crore for the quarter ended September 30, 2014. On the other hand, shares of Balkrishna Industries tumbled after reporting 16.5% year-on-year decline in net profit at Rs 90.16 crore for the quarter ended September 30, 2014 as compared to Rs 108 crore a year ago period.

On global front, Asian stocks slipped following fresh signs of slowing Chinese growth, with energy stocks depressed across the region as crude oil hovered near a four-year low in an oversupplied market. Back home, Indian rupee declined by eight paise to 61.63 against the US dollar in early trade on fresh demand for the American currency from banks and importers.

The market breadth on BSE was positive, out of 2394 stocks traded, 1376 stocks advanced, while 940 stocks declined on the BSE. 

The BSE Sensex is currently trading at 27996.80 up by 56.16 points or 0.20% after trading in a range of 28020.95 and 27912.90. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.75%, while Small cap index gained 0.65%.

The gaining sectoral indices on the BSE were Oil & Gas up by 1.28%, PSU up by 1.13%, Realty up by 1.12%, Metal up by 0.79% and Auto up by 0.79%, while Healthcare down by 0.47% was the only losing indices on BSE.

The top gainers on the Sensex were GAIL India up by 2.69%, Bajaj Auto up by 1.88%, ONGC up by 1.83%, SBI up by 1.60% and Coal India up by 1.34%. On the flip side, Tata Power down by 2.70%, Dr. Reddys Lab down by 1.34%, Cipla down by 1.33%, Hindustan Unilever down by 1.30% and Sun Pharma Inds. down by 1.20% were the top losers.

Meanwhile, In order for boosting revenues and contain budget borrowing, the government has raised excise duty on petrol and diesel by Rs 1.50 per litre. While the duty on branded petrol excise was hiked to Rs 3.85/litre from Rs 2.35/litre, that on unbranded petrol was hiked to Rs 2.70/litre from Rs 1.20/litre. Additionally, excise duty for branded diesel was raised to Rs 5.25/litre from Rs 3.75/litre and that of unbranded diesel was hiked to Rs 2.96/litre from Rs 1.46/litre.

This development doesn’t come as much of a surprise as reports earlier only had hinted that government was contemplating this move in order to ensure that the benefit of recent sharp decline in international oil prices, should not be limited to customers in the form of price cut in fuel prices, but also to the exchequer. The hike in excise duty is expected to mop up additional revenue of about Rs 14,000 crore to the exchequer.

International oil prices have fallen nearly 25% in the past five months, in step with a global commodities decline. The country's average crude import cost, as measured by the Indian crude basket has fallen to $80.87 per barrel (Rs 4,970) on November 7 from $108.05 per barrel (Rs 6,331) on May 26, the day the Narendra Modi government assumed office.

Notably, this development comes a little ahead of fortnightly review of the oil marketing companies, Indian Oil Corp (IOC ), Bharat Petroleum Corp (BPCL) and Hindustan Petroleum Corp (HPCL) on Saturday. However, this hike is not expected to burden consumers as oil companies plan to adjust the excise hike with a reduction in retail rates that was due this weekend.

So far, there has been a cut of about Rs 8-9 per litre in petrol and Rs 6 in diesel prices from its peak. Petrol price was last cut by Rs 2.41 a litre on November 1. On the same day, diesel rates were reduced by Rs 2.25 per litre.

The CNX Nifty is currently trading at 8,372.25 up by 14.40 points or 0.17% after trading in a range of 8,381.75 and 8,346.80. There were 33 stocks advancing against 17 declining on the index.

The top gainers on Nifty were GAIL India up by 2.86%, Bajaj Auto up by 1.77%, ONGC up by 1.71%, SBI up by 1.50% and PNB up by 1.47%. On the flip side, Tata Power down by 2.59%, Cipla down by 1.48%, Hindustan Unilever down by 1.28%, Sun Pharma down by 1.28% and Dr. Reddys Lab down by 1.22% were the top losers.

Asian markets were trading mostly in red; Nikkei 225 tumbled by 0.18%, Taiwan Weighted was up by 0.09%, Jakarta Composite down by 0.09%, KOSPI Index dipped 0.95%, Shanghai Composite slipped by 0.43% and FTSE Bursa Malaysia KLCI was down by 0.18%. On the flip side, Hang Seng gained 0.15% and Straits Times improved 0.17%.