Markets move slightly higher after a soft start

Markets are not seeing any major bounce back, making a soft start for the third straight session on Wednesday on global as well as domestic growth concern. India Inc is concerned about what they see as a lack of boldness in reforms and an absence of radical ideas from the new government. Weak economic data announced earlier too were acting as hurdles, India's current account deficit (CAD) widened sharply to $10.1 billion in the second quarter of FY15. Although, the government has exuded confidence that Current Account Deficit remains broadly under control despite an increase during the last quarter. Finance Minister Arun Jaitley has stated that there is no cause for concern with comfortable forex reserves position. Back on street, the initial fall was not sharp like last two sessions and there were regular attempt to break into green supported by value buying at lower levels, taking the markets modestly higher. On sectoral front too, most of the indices are showing sign of recovery with metals taking the lead, especially the steel stocks, as the World Trade Organisation (WTO) ruled against the US which had imposed high duty on imports of certain steel products from India. JSPL was up by over 3%, JSW Steel was up by over 1% and Bhushan Steel was up by about half a percent.

The BSE Sensex is currently trading at 27818.40, up by 21.39 points or 0.08% after trading in a range of 27710.03 and 27875.29. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.66%, while Small cap index gained 0.76%.

The top gaining sectoral indices on the BSE were INFRA up by 1.00%, Power up by 0.96%, Realty up by 0.82%, Metal up by 0.78%, PSU up by 0.61% while, FMCG down by 0.74% was the only losing index on BSE.

The top gainers on the Sensex were Tata Power up by 2.81%, Hero MotoCorp up by 1.19%, Sesa Sterlite up by 1.11%, Cipla up by 1.04% and ONGC up by 1.02%. On the flip side, Sun Pharma Inds. down by 1.17%, Hindustan Unilever down by 1.09%, ITC down by 0.99%, HDFC down by 0.67% and Bajaj Auto down by 0.50% were the top losers.

Meanwhile, Coal Ministry has proposed a minimum floor price of Rs 150 per tonne for auctioning coal mines to steel, cement as well as captive power plants and a reserve price of Rs 100 a tonne for mines to be allotted to government companies and power stations through the reverse auction method. 

According to proposal, the final floor and reserve price will be different for each block depending on the grade of the coal, using Coal India’s notified price for various types of the fuel. The floor price of the blocks would be worked out by computing their net present value (NPV) through the discounted cash flow method. Winners from steel, sponge iron and captive power plant industries would have to pay 10% of the floor price upfront. The ministry also suggested a cap on the auction price for the blocks being auctioned to the power sector where capacity has been set up under tariff-based bidding and with a cost-plus power purchase agreement.

The government is set to auction coal blocks, including operational and several others close to production, after the Supreme Court in September cancelled all mine allotments since 1993. The government will offer around 92 blocks during the first round of auction of which 59 have been reserved for the power sector. Of these 59, 25 blocks will be put out on auction and 34 will be allocated to Central and State public sector firms.

The CNX Nifty is currently trading at 8349.30, up by 8.60 points or 0.10% after trading in a range of 8317.00 and 8361.80. There were 36 stocks advancing against 14 stocks declining on the index.

The top gainers on Nifty were Jindal Steel & Power up by 3.27%, Tata Power up by 2.81%, Bank Of Baroda up by 1.21%, PNB up by 1.16% and Cairn India up by 1.12%. On the flip side, Asian Paints down by 1.66%, Hindustan Unilever down by 1.01%, ITC down by 0.93%, NMDC down by 0.75% and Sun Pharma Inds down by 0.74% were the top losers.

The Asian markets were showing mixed trend, Straits Times gained 8.94 points or 0.27% to 3,328.78, Shanghai Composite was up by 11.28 points or 0.39% to 2,867.55, FTSE Bursa Malaysia KLCI was higher by 14.89 points or 0.86% to 1,752.99 and Jakarta Composite was up by 15.24 points or 0.3% to 5,137.56.

On the other hand, Nikkei 225 declined by 376.58 points or 2.11% to 17,436.80, Taiwan Weighted lost 73.97 points or 0.81% to 9,054.93, Hang Seng was down by 39.4 points or 0.17% to 23,446.43 and KOSPI Index decreased by 23.68 points or 1.2% to 1,947.27.