Markets continue to trade sanguine on sustained value buying activities

Going from strength to strength, local equity markets were trading firmly in green with gains of over 3 /4 of a percent on sustained bargain buying activities by funds and retail investors which lifted both Sensex and Nifty above psychologically crucial 27,650 and 8,400 levels respectively. Meanwhile, the session also was splendid for broader indices, which outperforming larger counterparts were trading with gains in the range of 1.15-2.25%. Value-buying by funds in select bluechip stocks after recent losses amid a firming trend in other Asian markets, following weekend gains in US markets, buoyed trading sentiments At Dalal Street. The sentiments were also buttressed after global rating agency Fitch underscored that sustained fiscal consolidation, structural reforms and low inflation were positive for the country's ratings, prevented sharper slide of Indian currency.

On the global front, Asian stock markets rose on Monday, with China stocks nearing a seven-year peak on hopes for more infrastructure spending and policy stimulus. Activity was guarded most elsewhere in a week book-ended with holidays and a US jobs report that could affect the timing of interest rate hikes there.

Closer home, with broad based buying taking place most of the sectoral indices on BSE were trading into positive territory, with stocks from Capital Goods, Fast Moving Consumer Goods and Infrastructure counters emerging as the prominent gainers of the session. On the flip side, drubbing was witnessed only by stocks from Oil & Gas counters. In stock specific activity, PSU OMCs edged higher after steep slide in crude oil prices. Brent crude oil prices fell $56 a barrel on Monday, extending steep losses from the previous session as Iran and six world powers tried to reach a deal that could add oil to the market if sanctions against Tehran are lifted. The overall market breadth on BSE was in the favour of advances which thumped declines in the ratio of 1742:673; while 77 shares remained unchanged.

The BSE Sensex is currently trading at 27689.27, up by 230.63 points or 0.84% after trading in a range of 27624.76 and 27791.43. 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 1.15%, while Small cap index up by 2.24%.

The gaining sectoral indices on the BSE were Capital Goods up by 1.79%, FMCG up by 1.34%, INFRA up by 1.29%, PSU up by 1.02% and Power up by 0.87% while, Oil & Gas down by 0.57% were the losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 3.39%, Coal India up by 2.49%, HDFC up by 2.49%, ITC up by 2.03% and Larsen & Toubro up by 1.89%. On the flip side, Hindalco down by 2.13%, Tata Power down by 1.80%, Reliance Industries down by 1.60%, GAIL India down by 1.37% and Sesa Sterlite down by 1.09% were the top losers.

Meanwhile, in a positive development for the country, global rating agency, Fitch just right ahead of its annual sovereign rating scheduled for next month, in its report underscored that sustained fiscal consolidation, structural reforms and low inflation were positive for the country's ratings. The agency has allocated a 'BBB-'rating for the country with a stable outlook, which is the lowest investment grade rating.

According to the agency, while sustained fiscal consolidation or fiscal reforms would lead to a decline in the ratio of general government debt to GDP, implementation of structural reforms would raise the potential growth rate.Further, the rating agency also pointed that credible low-inflation environment will also be favorable for the rating. The agency, however, cautioned that a sharp and sustained external shock to foreign and domestic investors' confidence with the potential to cause external financing difficulties, such as an undue change in the monetary policy strategy was a threat for the country's credit rating.

As per the agency, India’s GDP growth is likely to be at 7.4% this fiscal and 8% in the next, based on new series. It suggested that government should focus on growth-enhancing reforms such as governance and investment climate; and infrastructure and inflation.  

The CNX Nifty is currently trading at 8407.85, up by 66.45 points or 0.80% after trading in a range of 8380.75 and 8432.65. There were 39 stocks advancing against 11 stocks declining on the index.

The top gainers on Nifty were Idea Cellular up by 3.63%, BPCL up by 3.14%, Bharti Airtel up by 3.03%, Asian Paints up by 2.44% and HDFC up by 2.41%. On the flip side, Tech Mahindra down by 3.98%, Hindalco down by 2.31%, Cairn India down by 2.11%, Tata Power down by 1.67% and Reliance Industries down by 1.47% were the top losers.

Asian markets were trading mostly higher; with FTSE Bursa Malaysia KLCI gained 9.04 points or 0.5% to 1,822.41; KOSPI Index gained 10.24 points or 0.51% to 2,030.04; Taiwan Weighted gained 18.15 points or 0.19% to 9,521.87; Jakarta Composite gained 51.39 points or 0.95% to 5,448.25; Shanghai Composite gained 96.73 points or 2.62% to 3,787.83; Nikkei 225 gained 125.77 points or 0.65% to 19,411.40; Hang Seng gained 430.94 points or 1.76% to 24,917.14. On the flip side, Straits Times down by 0.24 points or 0.01% to 3,449.86 was the only loser on the index.