Markets managing positive momentum with modest gains

In the extremely range-bound session of trade, Indian equity benchmarks altering between positive and negative territory, were now trading with positive bias as traders remained wary ahead of the RBI monetary policy review tomorrow, where it is widely expected to cut the repo rate by 25 basis points. Sentiments got a boost with India’s gross domestic product (GDP) grew at 7.5% during the January-March period, faster than China’s 7% in the same period, mainly on account of improvement in services and manufacturing sectors. Some support also came in from reports that Finance Minister Arun Jaitley has said that India has the potential to improve the economic growth to double-digit. However, investors remained cautious on disappointing company earnings and a weak trend at other Asian markets.

On global front, most of the Asian stock markets were trading in negative territory, tracking the weak lead from Wall Street and amid concerns about the outlook for the ongoing Greek debt negotiations. However, weak Chinese manufacturing data boosted stock markets in Shanghai and Hong Kong as investors speculated on the rising likelihood of new stimulus measures. Back home, Indian rupee strengthened 8 paise to 63.74 against the US dollar in the early on selling of the American currency by exporters as the economy grew at 7.5% in the March quarter.

Back on street, stocks from Realty, Oil & Gas and FMCG counters were supporting the markets’ uptrend, while those from Infrastructure, Auto and Consumer Durables counters were adding to the underlying cautious undertone. In scrip specific development, shares of India Tourism Development Corporation (ITDC) have surged after reporting nearly five-fold jump in standalone net profit at Rs 22.07 crore for the fourth quarter ended March 31, 2015, on back of strong operational performance. On the other hand, shares of Ipca Laboratories have declined after reporting a sharp 94% year on year (YoY) decline in standalone net profit at Rs 7.79 crore for the fourth quarter ended March 31, 2015.

The market breadth on BSE was positive, out of 2242 stocks traded, 1142 stocks advanced, while 1011 stocks declined on the BSE. 

The BSE Sensex is currently trading at 27872.10, up by 43.66 points or 0.16% after trading in a range of 27737.58 and 27880.15. 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 0.22%, while Small cap index up by 0.14%.

The top gaining sectoral indices on the BSE were Realty up by 1.39%, Oil & Gas up by 0.94%, FMCG up by 0.71%, Capital Goods up by 0.70% and Metal up by 0.60%, while Infrastructure down by 0.67%, Auto down by 0.54%, Consumer Durables down by 0.06% and TECK down by 0.05% were the top losing indices on BSE.

The top gainers on the Sensex were Cipla up by 2.62%, Reliance Industries up by 2.40%, ITC up by 1.70%, Vedanta up by 1.55% and BHEL up by 1.45%. On the flip side, Sun Pharma down by 8.67%, Bharti Airtel down by 1.81%, Tata Motors down by 1.46%, Hero MotoCorp down by 1.15% and ONGC down by 0.68% were the top losers.

Meanwhile, Supported by good growth in manufacturing and services, India’s economy grew by 7.3 per cent during 2014-15, the first financial year of the new government, up from 6.9 percent a year ago, showing signs of recovery. As per the provisional estimates of Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation, for the Financial Year 2014-15, GDP Growth at basic prices increased 0.6% from 6.6% to 7.2%, while GDP growth at market prices increased from 6.9% to 7.3%. This increase happened despite a decline in agriculture growth from 3.7% in Financial Year 2013-14 to 0.2 % in Financial Year 2014-15.

The manufacturing growth increased substantially from 5.3% in Financial Year 2013-14 to 7.1% in Financial Year 2014-15, while Services growth increased substantially to 10.2% in Financial Year 2014-15 from 9.1% in Financial Year 2013-14.Within services, financial, real estate, and professional services increased from 7.9% in FY 2013-14 to 11.5% in FY 2014-15. The Finance Ministry further added that the capital formation increased from 3% in FY 2013-14 to 4.6% in FY 2014-15. Private Consumption remained broadly constant, while Government consumption decreased during from 8.2% in FY 2013-14 to 6.6 % in FY 2014-15.

India clocked 7.5% growth in January-March quarter, overtaking China which showed a growth of 7.4 percent in same quarter. The economic growth rate measured in terms of GVA for the January-March quarter improved to 6.1 percent as against 5.3 percent a year ago. The manufacturing sector recorded a growth rate of 8.4 percent during the last quarter of the last fiscal, up from 4.4 percent a year ago. Services sector too witnessed marked improved, though agriculture, mining and quarrying sectors were lagging. Output of mining and quarrying sector decelerated to 2.3 percent in the fourth quarter of the last fiscal as compared to a growth of 11.5 percent during the same period in 2013-14, while the agriculture output during the quarter declined by 1.4 percent as compared to a growth of 4.4 percent in the corresponding quarter of the previous fiscal.

The CSO has also revised the figures for three quarters of the last financial year. The GDP for the first quarter was revised to 6.7 percent, from 6.5 percent; for Q2 to 8.4 percent, from 8.2 and for Q3 to 6.6 percent from 7.5 percent. Gross Value Added (GVA), a new concept introduced by CSO to measure economic activity, rose by 7.2 percent in 2014-15, compared to 6.6 percent in the previous fiscal.

The CNX Nifty is currently trading at 8442.20, up by 8.55 points or 0.10% after trading in a range of 8405.40 and 8449.05. There were 35 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were Cipla up by 2.60%, Reliance Industries up by 2.40%, BPCL up by 2.16%, Vedanta up by 1.86% and ITC up by 1.54%. On the flip side, Sun Pharma down by 8.67%, HCL Tech down by 1.85%, Bharti Airtel down by 1.83%, Lupin down by 1.75% and Bosch down by 1.61% were the top losers.

Asian markets were trading mostly in the red; Nikkei 225 decreased 0.27%, Taiwan Weighted decreased 0.65%, Jakarta Composite decreased 0.55%, Straits Times decreased 0.75%, KOSPI Index decreased 0.71% and FTSE Bursa Malaysia KLCI decreased 0.66%. On the flip side, Shanghai Composite increased 2.85% and Hang Seng increased 0.66%.