Benchmarks continue firm trade; Consumer Durables lead

Indian equity markets continued their firm trade in the late afternoon session on account of buying in frontline blue chip counters taking cues from regional counterparts. Global rating agency Moody’s report titled ‘2015 Outlook-Global Credit Conditions’ stated that Indian economy is expected to pick up pace in 2015 and grow in the range of 5 to 6 percent, helped by strong domestic demand, bought some cheer on the street. Investors however maintained cautious approach ahead of the release of key macroeconomic data, i.e. consumer price index (CPI)-based inflation and Index of Industrial Production (IIP) data scheduled on Friday. Traders were seen piling position in Consumer Durables, Infra and Bankex stocks while selling was witnessed in Capital Goods, FMCG and IT sector stocks.  In scrip specific development, SKS Microfinance was trading firm after foreign brokerage firm initiate coverage on the stock with ‘Buy’ rating and an upside price target.

On the global front, the Asian markets were trading mostly in green while the European markets were trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,350 and 27,800 levels respectively. The market breadth on BSE was positive in the ratio of 1590:1128 while 101 scrips remained unchanged.

The BSE Sensex is currently trading at 27859.48, up by 62.47 points or 0.22% after trading in a range of 27710.03 and 27905.25. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.00%, while Small cap index up by 1.01%.

The gaining sectoral indices on the BSE were Consumer Durables up by 1.47%, INFRA up by 1.28%, Bankex up by 1.12%, Power up by 0.93%, PSU up by 0.91% while, Capital Goods down by 0.58%, FMCG down by 0.37%, IT down by 0.10%, TECK down by 0.03% were the losing indices on BSE.

The top gainers on the Sensex were SBI up by 2.51%, Tata Power up by 2.46%, ONGC up by 2.31%, Tata Motors up by 2.07% and Hero MotoCorp up by 1.63%. On the flip side, BHEL down by 2.10%, GAIL India down by 1.49%, Sun Pharma down by 1.39%, Bajaj Auto down by 1.07% and Larsen & Toubro down by 1.03% were the top losers.

Meanwhile, the State Bank of India's newly launched SBI Composite Index has jumped 16% in December to 55.4, suggesting a strong revival in manufacturing activity in the country. The index value for the month of December is the highest in the past 20 months amid a turnaround in sentiment after Prime Minister Narendra Modi was elected to power. The SBI Composite Index tracks primarily manufacturing activity in the country and rivals the existing British lender HSBC's Purchasing Manager Index. The SBI planned to publish the indicator on monthly basis, which will track two months in advance the possible trends in official estimates.

The SBI Composite index has been developed on the basis of the bank’s internal loan portfolio, which mirrors the credit demand in the country, and other data sets available in public domain. With an aim to predict the phase of business cycles for the economy,  this forward looking indicator takes into account detailed activity/traction in consumer spending, mining activity, interest rates, inflation, exchange rates, SBI lending and performance of various thematic indices. The index will help regulators, policy makers and market participants to identify the turning points in the manufacturing cycles in advance and adjust their investment or marketing strategy.

SBI Composite index captures two components of the manufacturing cycle, namely month-on-month and year-on-year growth. The two separate indices have been constructed on a scale of 0-100 and like HSBC Purchasing Manager Index, an index reading above 50 implies growth over the previous respective period and less than 50 would suggest a contraction over respective period. The SBI has notified that during the period 2007-2014, the SBI Composite Index predicts the direction correctly for 72% of times, while the directional predictability for PMI is stood around 50% for the same period. 

The CNX Nifty is currently trading at 8364.30, up by 23.60 points or 0.28% after trading in a range of 8317.00 and 8373.65. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Jindal Steel & Power up by 3.48%, SBI up by 2.58%, ONGC up by 2.37%, Tata Power up by 2.34% and PNB up by 2.30%. On the flip side, NMDC down by 2.61%, BHEL down by 2.28%, GAIL India down by 1.72%, Tech Mahindra down by 1.43% and Bajaj Auto down by 1.39% were the top losers.

The Asian markets were trading mostly in green; Straits Times increased 6.41 points or 0.19% to 3,326.25, FTSE Bursa Malaysia KLCI increased 19.23 points or 1.11% to 1,757.33, Jakarta Composite increased 37.02 points or 0.72% to 5,159.33, Hang Seng increased 38.69 points or 0.16% to 23,524.52 and Shanghai Composite increased 83.74 points or 2.93% to 2,940.01.

On the other hand, Nikkei 225 decreased 400.8 points or 2.25% to 17,412.58, Taiwan Weighted decreased 96.74 points or 1.06% to 9,032.16 and KOSPI Index decreased 25.39 points or 1.29% to 1,945.56.

The European markets were trading in green; UK’s FTSE 100 increased 29.13 points or 0.45% to 6,558.60, France’s CAC increased 34.02 points or 0.8% to 4,297.96 and Germany’s DAX increased 96.14 points or 0.98% to 9,889.85.