Markets managing positive momentum with modest gains

Indian markets after a downbeat start and picking up pace, are managing to hold the positive momentum with modest gains in early noon session. Sensex was trading above 27500 levels, while the Nifty too was holding the 8300 mark. Cautiousness was prevailing in the markets, restricting any major gains as Asian stock markets retreated and the Australian dollar briefly fell after the central bank cut interest rates for the second time in four months. The infra stocks were not very optimistic with Finance Minister Arun Jaitley scouting bigger engagement of Asian Development Bank (ADB) and saying that in addition to supporting conventional infrastructure projects, deeper engagement on development of Smart Cities, Industrial Corridors, Rail transport and manufacturing is needed. Traders were also cautious regarding development in the parliament, where important bills like GST and Real Estate Regulatory Authority Bill will be up for debate. Back on street, while the banking and power sector have started showing some fatigue, metal, realty and capital goods were trying to protect markets from slipping into red. The IT sector stocks have given up their early gains and were trading flat, after Cognizant Technology Solutions beat Q1 estimates. The company has given higher revenue guidance of 19-20 percent range on a non-GAAP basis.

The BSE Sensex is currently trading at 27511.63, up by 21.04 points or 0.08% after trading in a range of 27402.94 and 27603.71. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were outperforming the benchmarks; the BSE Mid cap index was up by 0.55%, while Small cap index gained 0.41%.

The top gaining sectoral indices on the BSE were Metal up by 1.94%, Capital Goods up by 0.78%, Realty up by 0.71%, Oil & Gas up by 0.47%, PSU up by 0.36%, while Power down by 0.30%, INFRA down by 0.14%, Bankex down by 0.10%, TECK down by 0.05% were the losing indices on BSE.

The top gainers on the Sensex were Vedanta up by 4.76%, Tata Steel up by 3.68%, ONGC up by 3.16%, Hindalco up by 2.06% and TCS up by 1.81%. On the flip side, Cipla down by 2.00%, Bharti Airtel down by 1.67%, Bajaj Auto down by 1.61%, Hero MotoCorp down by 1.40% and SBI down by 1.15% were the top losers.

Meanwhile, a private survey by analytics firm Dun & Bradstreet (D&B) has stated that the level of optimism about business environment among chief financial officers (CFOs) in the country declined in April-June period largely owing to slower pace of reforms than initially expected and weak profit level of the corporates.

According to the survey, the Composite CFO Optimism Index for April-June period of 2015 declined by around 4.9 percent on quarter-on-quarter basis but rose by about 24.5 per cent on year-on-year basis. Majority of CFOs expect level of financial risks on the company's balance sheet and risk appetite to remain unchanged during April-June quarter of 2015.

While the optimism level of both services and industrial sectors moderated during the second quarter of 2015, the optimism level of the services sector moderated strongly than the industrial sector. The survey opined that “Slower pace of reforms than initially expected, weak profit level of the corporates, non-revival in the demand conditions, policy logjam in upper house coupled with a tepid global recovery have led to the weak sentiment among the CFOs.”

The CNX Nifty is currently trading at 8331.95, up by 1.50 points or 0.02% after trading in a range of 8299.20 and 8355.65. There were 23 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were Vedanta up by 4.61%, Tata Steel up by 3.87%, ONGC up by 2.89%, NMDC up by 2.35% and Hindalco up by 2.18%. On the flip side, Cairn India down by 2.60%, Cipla down by 1.97%, Bharti Airtel down by 1.68%, Zee Entertainment down by 1.65% and Ambuja Cement down by 1.53% were the top losers.

Asian markets were trading mixed, FTSE Bursa Malaysia KLCI increased by 4.32 points or 0.24% to 1,822.59 and Jakarta Composite was up by 12.02 points or 0.23% to 5,153.15,

On the other hand, Hang Seng slumped by 394.6 points or 1.4% to 27,729.22, Shanghai Composite lost 141.83 points or 3.17% to 4,338.63, Taiwan Weighted declined by 24.91 points or 0.25% to 9,820.13 and Straits Times was lower by14.93 points or 0.43% to 3,467.77.