Firm trade continues on Dalal Street in early noon deals

Indian equity benchmarks continued to trade firm in early noon deals as sentiments remained up-beat after the International Monetary Fund (IMF) in its annual assessment report for the country has raised its growth forecast for the current fiscal to 7.2 percent. Moreover, Global rating agency Moody’s has retained India’s stable outlook on the sovereign rating at Baa3, citing the country's large and diversified economy and healthy private savings rate. Some support also came in with report that Indirect tax revenue (provisional) collections have increased to Rs 4,78,630 crore during April-February 2014-15, an increase of 7.4 percent over the corresponding period in the previous fiscal.

Global cues too remained supportive with most of the Asian equity counters were trading in the green terrain as surprise interest rate cut by South Korea's central bank aided sentiments. The Bank of Korea’s monetary policy committee cut its base rate by 25 basis points to a record low of 1.75%, its first cut in five months. It joined its counterparts in other countries which have recently taken advantage of lower inflation to ease monetary policy to spur sluggish growth.

Back home, there was broad based buying witnessed in the markets and apart from the blue chips, the broader markets too equally participated in the rally. Meanwhile, none of the sectoral indices were trading in the red, while power and infrastructure witnessed the maximum gain in trade. Metal, auto, fast moving consumer goods, capital goods, realty, technology and banking too were trading significantly. The broader indices too were trading in-line with benchmarks, while the market breadth on the BSE was positive; there were 1532 shares on the gaining side against 948 shares on the losing side while 100 shares remain unchanged.

The BSE Sensex is currently trading at 28854.69, up by 195.52 points or 0.68% after trading in a range of 28772.71 and 28912.96. There were 22 stocks advancing against 8 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 1.06%.

The gaining sectoral indices on the BSE were Power up by 1.96%, Infrastructure up by 1.54%, Metal up by 1.21%, Auto up by 1.12%, FMCG up by 1.09%

The top gainers on the Sensex were NTPC up by 4.48%, Tata Steel up by 2.53%, Sesa Sterlite up by 2.49%, Tata Motors up by 2.31% and BHEL up by 2.04%. On the flip side, Hindustan Unilever down by 0.96%, Wipro down by 0.93%, Dr. Reddys Lab down by 0.75%, Mahindra & Mahindra down by 0.67% and Bajaj Auto down by 0.55% were the top losers.

Meanwhile, global rating agency Moody’s has retained India’s stable outlook on the sovereign rating at Baa3, citing the country's large and diversified economy and healthy private savings rate.  However, the agency has pegged average retail inflation at 6.5 percent at end-March 2016, up from 4.6 percent this fiscal.

In its report Moody’s said the country's susceptibility to event risks is ‘moderate’. At this time, banking sector weakness is a key source of susceptibility to event risks. Slower growth coupled with high inflation and interest rates in the last two years have eroded banking sector asset quality and profitability, particularly among state-owned banks.

Moody’s pegged general government balance as percentage of GDP at minus 6.7 percent next fiscal, a marginally higher from minus 6.9 percent this fiscal and predicted an improvement in the general government debt to revenues ratio at 302.9 from 309.2, while the government interest payments as part of the GDP will come down to 22.4 percent from 23 percent. The rating agency also sounded positive on current account balance front too, pegging the CAD at -0.6 percent of GDP next fiscal, down from 1.1 percent this fiscal.

The report further citing the high government debt and deficits, weak physical and social infrastructure, recurrent inflation and regulatory uncertainty and complexity as credit challenges for the nation said the government finances are the weakest aspect of the credit profile and accessed it low.

The CNX Nifty is currently trading at 8760.95, up by 61.00 points or 0.70% after trading in a range of 8732.90 and 8773.60. There were 39 stocks advancing against 11 stocks declining on the index.

The top gainers on Nifty were NTPC up by 4.72%, Cairn India up by 4.20%, Tata Steel up by 2.77%, Sesa Sterlite up by 2.67% and Tata Motors up by 2.38%. On the flip side, Tech Mahindra down by 1.42%, Wipro down by 0.98%, Hindustan Unilever down by 0.90%, Dr. Reddys Lab down by 0.80% and Mahindra & Mahindra down by 0.73% were the top losers.

Asian markets were trading mostly in the green; Jakarta Composite rose 7.89 points or 0.15% to 5,427.46, FTSE Bursa Malaysia KLCI increased 9.59 points or 0.54% to 1,787.75, Shanghai Composite surged 51.98 points or 1.58% to 3,342.88, Taiwan Weighted gained 72.82 points or 0.76% to 9,596.00, Hang Seng jumped 112.26 points or 0.47% to 23,830.23 and Nikkei 225 was up by 267.59 points or 1.43% to 18,991.11. On the flip side, Straits Times decreased 12.06 points or 0.36% to 3,366.53 and KOSPI Index was down by 10.24 points or 0.52% to 1,970.59.