Benchmarks add gains; Consumer Durables leads

Indian equity markets added gains and continued its firm trade hovering near the highest point of the day in the late afternoon session on account of buying in frontline blue chip counters. The sentiments were on optimistic note after report released showed that India’s trade deficit narrowed to 10-month low at $9.43 billion in month of December as compared to $16.86 billion in November. Traders were seen piling positions in Consumer Durables, Capital Goods and Power stocks while selling was witnessed in IT and TECK sector stocks. In scrip specific development, SpiceJet is locked at upper circuit limit after the budget carrier announced its third change of ownership in a decade, with control circling back to original co-promoter Ajay Singh.  TCS was trading in red after the software exporter reported a marginal dip in net profit in December quarter due to lower margins.

On the global front, the Asian markets were trading mostly in red while the European markets were trading mostly on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,500 and 28,100 levels respectively. The market breadth on BSE was negative in the ratio of 1361:1392 while 113 scrips remained unchanged.

The BSE Sensex is currently trading at 28156.29, up by 80.74 points or 0.29% after trading in a range of 27945.31 and 28175.81. 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 0.52%, while Small cap index up by 0.20%.

The gaining sectoral indices on the BSE were Consumer Durables up by 2.28%, Capital Goods up by 1.48%, Power up by 1.41%, Realty up by 1.22%, Metal up by 1.05% while, IT down by 0.25%, TECK down by 0.10% were the losing indices on BSE.

The top gainers on the Sensex were Coal India up by 2.78%, Sun Pharma up by 2.08%, Sesa Sterlite up by 2.05%, Larsen & Toubro up by 1.76% and Mahindra & Mahindra up by 1.75%. On the flip side, Bharti Airtel down by 2.13%, Hero MotoCorp down by 1.70%, SBI down by 1.67%, Tata Motors down by 1.18% and TCS down by 0.94% were the top losers.

Meanwhile, a leading rating agency India Ratings has expected that Indian economy to grow at 6.5% in the next fiscal from 5.6% this fiscal. The rating agency is of the view that a number of announcements made in the last Budget to address the structural issues plaguing industrial and infrastructure sectors could gather pace in the next fiscal, besides the government will announce few more initiative in the new Budget to boost the economic growth.

Moreover, the government’s push for ‘Make in India’ which focuses on select 26 sectors and improving the ‘ease of doing business will aid the manufacturing and industrial growth. India Ratings also estimated the industry to grow at 6.5% in FY16 against the projected 3.6% in the current fiscal. On inflation front, it highlighted that wholesale price index (WPI) and consumer price index (CPI) based inflation to moderate to 2.8% and 6.0%, respectively, in FY16. Further, it hopes that the RBI to cut the repo rate by another 75bps by FY16, after 25 basis points cut January 15.

On declining crude oil prices, the agency noted that declining crude prices is a windfall gain for the Indian economy. It has improved both the inflation and fiscal outlook.  Referring to fiscal deficit, it noted that measures such as dramatic fall in global crude prices, an increase in excise on petrol and diesel, cancellation of coal block allocations and penalties imposed, higher surplus transferred by RBI to the government and the announced 10% cut in the non-Plan expenditures, are all likely to help the government balance its revenue and expenditure better in FY15. However, these measures will still not be enough to bridge the gap arising out of the shortfall in tax and non-tax revenue and the fiscal deficit in FY15 will be 4.2% of GDP. Meanwhile, the fiscal deficit could fall to 3.9 % in FY16 with higher growth, expected tax reforms and expenditure rationalisation.

The CNX Nifty is currently trading at 8520.10, up by 25.95 points or 0.31% after trading in a range of 8452.25 and 8530.75. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Zee Entertainment up by 3.93%, Power Grid up by 3.67%, Coal India up by 3.07%, Sun Pharma up by 2.13% and Sesa Sterlite up by 2.08%. On the flip side, Bharti Airtel down by 2.18%, PNB down by 1.95%, SBI down by 1.75%, Hero MotoCorp down by 1.70% and Cairn India down by 1.56% were the top losers.

The Asian markets were trading mostly in red; Hang Seng decreased 247.39 points or 1.02% to 24,103.52, Nikkei 225 decreased 244.54 points or 1.43% to 16,864.16, Straits Times decreased 41.5 points or 1.24% to 3,297.34, Taiwan Weighted decreased 26.8 points or 0.29% to 9,138.29, KOSPI Index decreased 26.01 points or 1.36% to 1,888.13, Jakarta Composite decreased 20.84 points or 0.4% to 5,167.88 and FTSE Bursa Malaysia KLCI decreased 0.8 points or 0.05% to 1,744.20.

On the other hand, Shanghai Composite increased 40.04 points or 1.2% to 3,376.50.

The European markets were trading mostly in green; Germany’s DAX increased 5.91 points or 0.06% to 10,038.52, France’s CAC increased 12.85 points or 0.3% to 4,336.05 while, UK’s FTSE 100 decreased 18.79 points or 0.29% to 6,479.99.