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 Banking, Auto and Capital Goods stocks. Sentiment on the street improved on the back of a firming trend in other Asian markets, following overnight gains in US markets ahead of economic data releases. Besides, covering-up of pending short positions by speculators in view of monthly settlement in the derivatives segment as the markets will remain closed on Thursday on account of 'Christmas', also supported the rise. However, traders are bit cautious with an official of international credit ratings agency Moody’s statement that high fiscal deficits constrain India’s rating now. Meanwhile, selling by foreign institutional investors continued unabated and they were net sellers in Indian equities worth Rs 335.24 crore on Monday, also weighed on the sentiment.

On global front, Asian stocks were mostly higher after Wall Street closed at record highs in a traditional pre-Christmas advance. Sentiments were boosted on speculations that the European Central Bank is set to start buying euro government bonds and news of political stability in Greece. However, activity is mostly stock-specific in most of the markets in the region as volatility in commodity prices prompt investors to refrain from making significant moves. Back home, Indian rupee depreciated by four paise to 63.29 against the US dollar in early trade on fresh demand for the American currency from banks and importers.

On the sectoral front, stocks from Banking, Auto and Infrastructure counters were supporting the markets’ uptrend, while those from Metal, Oil & Gas and Realty counters were adding to the underlying cautious undertone. In scrip specific development, Shares of Jet Airways gained on concluding a five-year syndicated loan facility of $150 million. Furthermore, Gujarat Pipavav Port rose after the company entered into an arrangement with NYK Auto Logistics. The market breadth on BSE was positive, out of 2117 stocks traded, 1169 stocks advanced, while 856 stocks declined on the BSE. 

The BSE Sensex is currently trading at 27793.47 up by 91.68 points or 0.33% after trading in a range of 27851.10 and 27701.13. There were 20 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.27%, while Small cap index gained 0.43%

The gaining sectoral indices on the BSE were Bankex up by 0.68%, Auto up by 0.45%, Infrastructure up by 0.42%, Capital Goods up by 0.37% and Power up by 0.32% while, Metal down by 0.73%, Oil & Gas down by 0.46% and Realty down by 0.28% were the losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 1.63%, Axis Bank up by 1.25%, HDFC up by 1.24%, Bajaj Auto up by 1.24% and Mahindra & Mahindra up by 0.99%. On the flip side, Hindalco down by 1.73%, Sesa Sterlite down by 1.09%, Dr. Reddys Lab down by 0.98%, Coal India down by 0.97% and Wipro down by 0.77% were the top losers.

Meanwhile, the Government is targeting revenue of Rs 1.47 lakh crore from the allotment and auction of 92 cancelled coal blocks in the first round of auction. Out of the 92 cancelled coal blocks, 57 mines will be allocated to power sector while 35 other blocks to non-power sector and captive power plants.

The 92 coal blocks have geological reserves of 18,446 million tonnes. The blocks for the power sector have geological reserves of 15,305 million tonnes and the revenue from these blocks at a base price of Rs 100 per tonne, is likely to come to around Rs 1.53 lakh crore. For the non-power or captive power plant blocks having geological reserves of 3,141, at a price of Rs 295 per tonne, comes to around 92,696 crore. The government stated that total revenues from both power and non-power sector are likely to come at around Rs 2.45 lakh crore and if extractable reserves are taken as 60 percent of the geological reserves, the total revenue would be around Rs 1,47,448 crore.

In last week, the government has increased the number of coal mines to be auctioned or allotted in the first tranche to 101, from 92. Out of which 65 mines will be allocated to private players while 36 other blocks will be directly allotted to state-owned companies. The government had earlier also finalised rules for auction or allotment of 204 coal mines that were quashed by Supreme Court in September.

The CNX Nifty is currently trading at 8349.90 up by 25.90 points or 0.31% after trading in a range of 8364.75 and 8319.15. There were 35 stocks advancing against 15 declining on the index.

The top gainers on Nifty were Bharti Airtel up by 1.83%, Bank of Baroda up by 1.79%, Jindal Steel & Power up by 1.31%, HDFC up by 1.17% and Lupin up by 1.16%. On the flip side, Hindalco down by 1.51%, Cairn India down by 1.49%, HCL  down by 1.30%, Sesa Sterlite down by 1.23% and Coal India down by 1.15% were the top losers.

The Asian markets were trading mostly in the green; Straits Times rose 0.07%, Taiwan Weighted gained 0.01%, FTSE Bursa Malaysia KLCI increased 0.37%, Jakarta Composite added 0.36% and Hang Seng was up by 0.15%. On the flip side, Shanghai Composite decreased 0.73% and KOSPI Index was down by 0.27%.