Benchmarks pair some early gains in late morning session

Indian equity benchmarks paired some early gains and were trading in a narrow range with a positive bias in late morning session led by gains in Metal, information technology and Realty stocks. Besides, firm global cues coupled with the appreciation in rupee value against the dollar added to the optimistic sentiments. Sentiment on the street improved as investors remained hopeful of possible rate cuts. Some support also came in after Finance Minister Arun Jaitley has said that Budget 2015-16 would unveil 'a whole set of second-generation reforms' as well as reforms that require undoing. Moreover, Indian infrastructure space is set for a major fund-boost worth billions of dollars from the foreign venture capital investors as regulator Sebi has removed a lacunae in norms to allow such investments. However, gains remained capped as a Ficci survey has stated that the country’s manufacturing sector is likely to witness a moderate growth in the third quarter of this fiscal. Also, the foreign direct investment (FDI) to India, falling for the second month in a row, declined about 16 per cent to $2.45 billion in September.

Meanwhile, some traders remained on the sidelines and refrained from any buying activity as Reserve Bank of India is scheduled to release the current account deficit (CAD) numbers for second quarter of the current fiscal later today. In scrip specific development, shares of Rajesh Exports have rallied after the company bagged an export order worth Rs 1,350 crore of designer range of gold and diamond studded jewellery and medallions from Al Sultan Jewellery, UAE. On the other hand, shares of Power Grid Corporation of India have declined after RBI has notified that the foreign shareholding through FIIs/ RFPIs in Power Grid has reached the trigger limit.

On global front, most Asian markets rose as the prospect of further policy stimulus in China and Europe whetted risk appetites while sending the euro skidding. Back home, Indian rupee strengthened by eight paise to 61.68 against the dollar in early trade on increased selling of the US currency by exporters and banks amidst sustained foreign capital inflows.

The market breadth on BSE was positive, out of 2492 stocks traded, 1263 stocks advanced, while 1139 stocks declined on the BSE. 

The BSE Sensex is currently trading at 28414.76 up by 80.13 points or 0.28% after trading in a range of 28514.98 and 28394.48. 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 0.23%, while Small cap index gained 0.17%.

The gaining sectoral indices on the BSE were Metal up by 1.94%, IT up by 1.27%, TECK up by 0.95%, Realty up by 0.48% and Bankex up by 0.43% while, Oil & Gas down by 0.40% and FMCG down by 0.39% were the losing indices on BSE.

The top gainers on the Sensex were Hindalco up by 3.47%, Infosys up by 2.46%, Tata Steel up by 2.40%, Sesa Sterlite up by 1.94% and Tata Power up by 1.59%. On the flip side, Reliance Industries down by 1.13%, Mahindra & Mahindra down by 1.01%, Cipla down by 0.81%, Hindustan Unilever down by 0.68% and Bharti Airtel down by 0.60% were the top losers.

Meanwhile, in a major policy development government will allow commercial mining of coal by private companies after allocating mines to public sector companies and auction to specific end users. Allowing private companies into commercial mining will help raise coal output as state monopoly Coal India, which produces about 80 percent of the nation's coal has missed all its output targets in last four years.

Finance Minister Arun Jaitley said that 'First you give it to the state and central PSUs. Thereafter, you make a pool of all actual users and have an auction. 'Then the extra resource, while preserving the character of Coal India, without disturbing it, you then start exploring the possibility of commercial mining.' However, the minister has not given a timeline for allowing commercial mining by private firms.

The government had last month promulgated an Ordinance for auctioning the 204 coal blocks whose allocation was cancelled by the Supreme Court in September. The auction and allocation of coal blocks through a transparent methodology would ensure that coal exploration will begin and the actual users will get the fuel rather than importing and putting a burden on current account. However, describing the government's move to reallocate the blocks by e-auction as 'not at all a welcome decision,” the Centre of Indian Trade Unions (CITU) has said it condemns any move to nullify the Coal Nationalisation Act.

The CNX Nifty is currently trading at 8496.75 up by 19.40 points or 0.23% after trading in a range of 8529.00 and 8490.80. There were 31 stocks advancing against 19 declining on the index.

The top gainers on Nifty were Jindal Steel & Power up by 3.88%, Hindalco up by 3.34%, Zee Entertainment up by 2.48%, Infosys up by 2.36% and Tata Steel up by 2.18%. On the flip side, Power Grid down by 2.80%, Asian Paints down by 1.25%, Mahindra & Mahindra down by 1.17%, Reliance Industries down by 1.16% and Kotak Mahindra Bank down by 1.12% were the top losers.

Asian markets were trading mostly in the green; KOSPI Index rose 0.57%, FTSE Bursa Malaysia KLCI surged 1.05%, Jakarta Composite strengthened 0.56%, Taiwan Weighted gained 0.23%, Shanghai Composite soared 1.96%, Nikkei 225 increased 0.33% and Hang Seng was up by 1.87%. On the flip side, Straits Times was down by 0.04%.