Benchmarks trader higher in early deals on firm global cues

Buoyed by firm global cues, Indian equity benchmarks are trading in green in early deals on Friday. The US markets made mostly a positive close in last session, with S&P 500 surging to new record highs. There were mixed set of economic data, while the National Association of Realtors reported an unexpected drop in existing home sales in the month of April, the Conference Board’s index of leading economic indicators rose by much more than expected in April. The Asian markets were trading mostly in the green at this point of time, as mixed US economic data fueled bets the Federal Reserve won’t rush to raise interest rates in June. Chinese markets are continuing their rally mood with another good start.

Back home, some support came with government’s decision of relaxing FDI norms for NRIs, PIOs and OCI. Government has decided that non-repatriable investments by NRIs, OCIs and PIOs will be treated as domestic investments and will not be subject to foreign direct investment caps. Also, the Reserve Bank of India has trebled the limit on trade-linked remittances to Rs 15 lakh from the earlier Rs 5 lakh. It has also allowed overseas banks to enter into swaps with other overseas banks besides domestic banks to facilitate disbursals of rupee loans by overseas lenders.

On the sectoral front, fast moving consumer goods, banking and public sector undertaking witnessed the maximum gain in trade, while technology, infrastructure and metal 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 1046 shares on the gaining side against 698 shares on the losing side while 74 shares remain unchanged.

The BSE Sensex is currently trading at 27911.01, up by 101.66 points or 0.37% after trading in a range of 27828.61 and 27917.13. There were 15 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.43%, while Small cap index gained 0.41%.

The top gaining sectoral indices on the BSE were FMCG up by 0.92%, Bankex up by 0.61%, PSU up by 0.55%, Capital Goods up by 0.44% and Realty up by 0.43% while, TECK down by 0.18%, INFRA down by 0.11%, Metal down by 0.08%, IT down by 0.07% and Power down by 0.05% were the losing indices on BSE.

The top gainers on the Sensex were SBI up by 2.64%, ITC up by 1.39%, ONGC up by 1.23%, Tata Steel up by 1.17% and GAIL India up by 0.84%. On the flip side, Bajaj Auto down by 1.60%, Wipro down by 1.57%, Hindalco down by 1.26%, Vedanta down by 0.89% and Bharti Airtel down by 0.86% were the top losers.

Meanwhile, Finance Secretary Rajiv Mehrishi has said that Indian economy is expected to expand at 8.5-9 percent over 10-15 year time frame once the structural issues hampering growth are addressed by the government. Mehrishi added that “India has a growth potential close to 8.5 percent to 9 percent over the next 10-15 years... The short term growth may be lower on account of structural issues which we are tackling”.

Finance Secretary further stated that strong economic growth, is necessary for solving many socio-economic problems facing the country and the government has taken various initiatives to deal with the structural issues like going in for auction of key infrastructure inputs such as coal and spectrum, setting up of the MUDRA Bank and streamlining the norms for foreign direct investment (FDI).

Talking about the India Meteorological Department’s (IMD) projection of below normal monsoon, the Finance Secretary said: 'A weak monsoon generally leads to low rural economic growth and spike in prices of food commodities. However, this year food prices are expected to remain stable”, as the government was also taking a host of steps to address rural distress “through programmes rather that price distorting measures”. India’s growth is expected to be at least 8 percent in the current fiscal on account of initiatives taken by the government to boost investment and growth.

The CNX Nifty is currently trading at 8439.70, up by 18.70 points or 0.22% after trading in a range of 8420.60 and 8441.70. There were 26 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were SBI up by 2.34%, Bank of Baroda up by 1.60%, Tata Steel up by 1.39%, ITC up by 1.37% and IDFC up by 1.27%. On the flip side, Bajaj Auto down by 1.59%, Hindalco down by 1.37%, Wipro down by 1.28%, Ultratech Cement down by 1.23% and HCL Tech down by 1.14% were the top losers.

Asian markets were trading mostly in the green; Straits Times increased 7.95 points or 0.23% to 3,447.81, Nikkei 225 rose 12.67 points or 0.06% to 20,215.54, KOSPI Index jumped 14.92 points or 0.7% to 2,137.73, Taiwan Weighted added 76.76 points or 0.8% to 9,655.32, Shanghai Composite surged 87.6 points or 1.93% to 4,617.02 and Hang Seng was up by 394.55 points or 1.43% to 27,918.27.

On the flip side, Jakarta Composite decreased 12.83 points or 0.24% to 5,300.38 and FTSE Bursa Malaysia KLCI was down by 3.89 points or 0.22% to 1,791.15.