Markets extend their northward journey

Indian equity benchmarks extended early gains to continue firm trade in late morning session, hovering near intra-day high levels on sustained buying by funds and retail investors. Besides, optimism among funds and retail investors over encouraging Q3 earnings by blue-chip companies, so far, also buoyed the trading sentiment. Appreciation in Indian rupee too supported the sentiments. The partially convertible rupee was strengthened by 7 paise to 61.56 against the US dollar in early trade at the Interbank Foreign Exchange amid sustained overseas capital inflows.

Asian markets were trading mostly in the green at this point of time as investors bet the European Central Bank will unveil a bond-buying stimulus programme later in the day in an attempt to revive the flagging euro zone economy. Back home, shares of real estate companies edged higher after Prime Minister Narendra Modi has directed all concerned departments to immediately finalise the programme and finalise the financing models for alternate sets of housing requirements with regard to the government's Housing for All Mission.

On the sectoral front, healthcare, realty and capital goods witnessed the maximum gain in trade, while oil and gas remained the lone loser on the BSE sectoral space. The broader indices too were going neck-to-neck with benchmarks, while the market breadth on the BSE was positive; there were 1348 shares on the gaining side against 892 shares on the losing side while 90 shares remain unchanged.

The BSE Sensex is currently trading at 29058.15, up by 169.29 points or 0.59% after trading in a range of 28941.93 and 29059.25. There were 24 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.62%, while Small cap index up by 0.70%.

The gaining sectoral indices on the BSE were Healthcare up by 0.62%, Realty up by 1.22%, Capital Goods up by 1.14%, FMCG up by 0.87% and Metal up by 0.62%, while Oil & Gas down by 0.27% was the lone losing index on BSE.

The top gainers on the Sensex were Sun Pharma up by 3.10%, Axis Bank up by 1.87%, Infosys up by 1.49%, ONGC up by 1.46% and Sesa Sterlite up by 1.43%. On the flip side, Reliance Industries down by 1.24%, NTPC down by 1.18%, Tata Power down by 0.54%, Maruti Suzuki down by 0.50% and SBI down by 0.44% were the top losers.

Meanwhile, amid rising concern over the widening trade deficit with China, India can explore export potential of food products like dairy products, marines, fresh and processed items to China with a view to bridge the widening trade gap. India’s trade deficit with China stood at about $36 billion during FY14 with exports around $15 billion against $51 billion imports.

India has already expressed concerns over widening trade deficit with China and limited market access to its products due to a host of issues. India exports raw materials and imports mostly finished items. The exports of domestic products like engineering goods, pharmaceuticals and farm products is limited due to various issues related to tariff barriers, regulatory and other complexities.

However, the government is taking various measures to enhance the Chinese investments in the country. It had recently given an in-principle approval to a memorandum of understanding (MoU) allowing China to set up industrial parks in the country. The industrial parks are expected to include special economic zones (SEZs) and manufacturing zones. At present, China is setting up two industrial parks in states including Maharashtra and Gujarat.

Further, India and China have set $100 billion trade target by 2015. However, India had already asked the Chinese government to provide more access to the market so that the target of $100 billion can be achieved in a more balanced manner. Better access of Chinese markets to domestic IT-enabled services, cotton textiles, home furnishings and pharmaceuticals could also help India to reduce the imbalance in trade.

The CNX Nifty is currently trading at 8770.85, up by 41.35 points or 0.47% after trading in a range of 8734.90 and 8772.70. There were 36 stocks advancing against 14 stocks declining on the index.

The top gainers on Nifty were DLF up by 3.58%, Sun Pharma up by 3.28%, Asian Paints up by 2.49%, Ultratech Cement up by 2.41% and Axis Bank up by 1.86%. On the flip side, Reliance Industries down by 1.50%, HCL Tech. down by 1.32%, NTPC down by 1.18%, NMDC down by 0.87% and Bank of Baroda down by 0.66% were the top losers.

Asian markets were trading mostly in the green; Straits Times rose 7.78 points or 0.23% to 3,362.24, FTSE Bursa Malaysia KLCI jumped 9.88 points or 0.56% to 1,779.97, Jakarta Composite gained 32.25 points or 0.62% to 5,247.52, Taiwan Weighted increased 32.71 points or 0.35% to 9,352.42 and Hang Seng was up by 99.54 points or 0.41% to 24,452.12.

On the flip side, Nikkei 225 decreased 37.11 points or 0.21% to 17,243.37, Shanghai Composite slipped 3.76 points or 0.11% to 3,319.85 and KOSPI Index was down by 2.07 points or 0.11% to 1,919.16.