Benchmarks trade in fine fettle in early deals

Indian equity benchmarks have made a gap-up opening and are trading in fine fettle in early deals on Thursday as investors opted to buy beaten down but fundamentally strong stocks after three days of drubbing. Sentiments remained up-beat with International Monetary Fund’s latest report raising its forecasts of India’s economic growth to 7.2% in the current fiscal year, compared to 5.6% as predicted earlier. Some support also came in with the statement of Revenue Secretary that the GST rollout is on track. He has also said that the roadmap for the removal of corporate tax exemptions announced in the Union Budget are also set to be announced during the course of this year.

On the global front, the US markets failed to sustain an early lead and ended modestly lower in last session, traders remained on sidelines ahead of the Federal Reserve’s monetary policy meeting next week. Traders were also concerned about the strength in dollar and situation in Greece. The Asian markets were trading mostly in the green after South Korean central bank unexpectedly cut interest rates.

Back home, on the sectoral front, power, infrastructure and fast moving consumer goods witnessed the maximum gain in trade, while software remained the top losers on the BSE sectoral space. The broader indices too were trading with traction, while the market breadth on the BSE was positive; there were 1,374 shares on the gaining side against 613 shares on the losing side while 72 shares remain unchanged.

The BSE Sensex is currently trading at 28843.86, up by 184.69 points or 0.64% after trading in a range of 28772.71 and 28912.96. There were 25 stocks advancing against 5 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.92%, while Small cap index up by 0.93%.

The gaining sectoral indices on the BSE were Power up by 2.02%, Infrastructure up by 1.40%, FMCG up by 1.18%, Capital Goods up by 0.92%, PSU up by 0.86% while, IT down by 0.14% was the lone losing index on BSE.

The top gainers on the Sensex were NTPC up by 5.42%, ITC up by 2.01%, Maruti Suzuki up by 1.50%, Tata Motors up by 1.47% and Tata Power up by 1.24%. On the flip side, Dr. Reddys Lab down by 1.15%, Mahindra & Mahindra down by 1.11%, Hindustan Unilever down by 0.70%, Wipro down by 0.70% and Bajaj Auto down by 0.48% were the top losers.

Meanwhile, the government has revived plans to set up a fertilizer plant in Iran with an investment of about Rs 5,000 crore. The proposal is to set up a urea/ammonia JV Project with capacity to produce 1.3 MT Urea for import to India. However, the government has requested the Persian Gulf nation to offer long term gas contract for manufacturing the soil nutrient at feasible rates.

The government has nominated companies like Rashtriya Chemicals and Fertilizers (RCF), Gujarat Narmada Valley Fertilizers & Chemicals (GNFC) and Gujarat State Fertilizers Corporation (GSFC) for the proposed 1.3 million tonne urea joint venture plant.  These Indian companies’ have appointed SBI Capital to identify the Iranian partners for the Joint Venture Project.

Notably, both the nations have been in discussions for setting up of a fertilizer plant in the Persian Gulf nation since 2013, but talks failed to fructify stuck over gas price issue. However, India has revived its plans after Iranian authorities approached the government officials and expressed willingness to partner with them in this project.

The proposed urea joint venture plant in Iran would be on the similar lines of OMIFCO (Oman India Fertiliser Company) in Oman, where the Indian entities have jointly invested in urea manufacturing with local player. The Indian government has a long term off-take arrangement with OMIFCO for sourcing urea, which is produced at lower rates compared to domestic cost of production.

The CNX Nifty is currently trading at 8755.85, up by 55.90 points or 0.64% after trading in a range of 8732.90 and 8773.60. There were 42 stocks advancing against 8 stocks declining on the index.

The top gainers on Nifty were NTPC up by 5.50%, Ambuja Cement up by 2.98%, Power Grid Corpn up by 2.40%, ITC up by 2.28% and Grasim Industries up by 1.76%. On the flip side, Tech Mahindra down by 1.45%, Mahindra & Mahindra down by 1.38%, Dr. Reddys Lab down by 1.01%, Wipro down by 0.97% and Hindustan Unilever down by 0.66% were the top losers.

Asian markets were trading mostly in the green; KOSPI Index rose 7.48 points or 0.38% to 1,988.31, FTSE Bursa Malaysia KLCI gained 9.59 points or 0.54% to 1,787.75, Jakarta Composite advanced 14.7 points or 0.27% to 5,434.27, Shanghai Composite surged 44.55 points or 1.35% to 3,335.45, Taiwan Weighted increased 72.18 points or 0.76% to 9,595.36, Hang Seng increased 101.62 jumped or 0.43% to 23,819.59 and Nikkei 225 was up by 260.36 points or 1.39% to 18,983.88. On the flip side, Straits Times was down by 8.03 points or 0.24% to 3,370.56.