Markets move into green but the trade remains range-bound

Markets stretching the consolidation mood for the second session were trading marginally in green in early noon on Friday, though there were some attempts of recovery but the major indices were showing mostly a range-bound trade and all the small attempts of bounce back were being sold out lacking any strong supportive cues. Traders are not looking convinced with Finance Minister Arun Jaitley’s statement, who allaying concerns over the forecast of a rain deficient monsoon has said that the effect won’t be as dire as the plummeting stock markets seemed to indicate. He also assured that the government was having more than sufficient food stock and taking them to the market is one of the tools the government has. Back on the street, while the broader markets have recovered and were trading marginally in green, sectoral gauges like realty, IT, tech, auto and banking were still reeling in red. The PSU index has however strengthened after the Finance Minister Arun Jaitley said that the government’s PSU disinvestment programme will continue as planned, irrespective of the market volatility.

The BSE Sensex is currently trading at 26838.92, up by 25.50 points or 0.10% after trading in a range of 26718.44 and 26850.39. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.46%, while Small cap index gained 0.50%.

The top gaining sectoral indices on the BSE were Metal up by 2.15%, Capital Goods up by 1.22%, PSU up by 1.14%, Consumer Durables up by 0.85%, Power up by 0.85%, while Realty down by 0.90%, Auto down by 0.75%, IT down by 0.57%, TECK down by 0.34%, Bankex down by 0.22% were the losing indices on BSE.

The top gainers on the Sensex were Coal India up by 5.00%, Sun Pharma Inds. up by 2.87%, GAIL India up by 2.54%, NTPC up by 1.87% and Larsen & Toubro up by 1.68%. On the flip side, Tata Motors down by 2.51%, TCS down by 1.16%, HDFC down by 1.09%, Axis Bank down by 0.76% and HDFC Bank down by 0.74% were the top losers.

Meanwhile, the government has announced the launch of third round of coal block auction for 10 mines with over 350 million tonnes of reserves exclusively to unregulated sectors like steel and cement, between August 11 and 17. Under schedule II category (producing) mines, two will be auctioned, while in the schedule III (ready to produce) eight mines will be put on offer.

The coal secretary Anil Swarup announced that the government will issue the tenders inviting technical and financial bids for the mines from June 8 and the last date for submission of the documents will be July 21. Of the 10 blocks, most have requisite approvals and are located in Maharashtra, Jharkhand, Chhattisgarh and Odisha. Five of these blocks were offered to private companies in the first two rounds of auction, but were later withdrawn as they received less than three bids.

Swarup further added that the ministry has issued instructions to the Nominated Authority to conduct the auctions for mines classified for iron and steel, cement and captive power plant sector and the government will follow the same process as was followed in the auctions held earlier this year with just one change that on this occasion government will treat multiple bids of a single entity as a single bid in terms of determining the 50 percent qualifiers. The government has already auctioned 28 coal mines in last two blocks.

The coal secretary also said the ministry was considering auction of coal linkages for unregulated sectors, including cement and steel, for five years and the ministry is seeking comments from the stakeholders on methodology for proposed auction of coal linkages/LoAs to non-regulated sector through competitive bidding.

The CNX Nifty is currently trading at 8150.20, up by 19.55 points or 0.24% after trading in a range of 8100.15 and 8153.00. There were 29 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Coal India up by 5.01%, Sun Pharma Inds. up by 2.94%, Idea Cellular up by 2.93%, GAIL India up by 2.47% and NMDC up by 2.34%. On the flip side, ACC down by 2.11%, Ambuja Cement down by 2.10%, Tata Motors down by 1.83%, Bosch down by 1.28% and TCS down by 0.91% were the top losers.

Asian markets were trading mostly in the red barring Shanghai Composite which was up by 0.81%, on the other hand Hang Seng was down by 0.69%, Nikkei 225 lost 0.13%, Jakarta Composite declined by 0.24%, FTSE Bursa Malaysia KLCI decreased by 0.01%, Taiwan Weighted lost 0.09%, KOSPI Index dipped by 0.23% and Straits Times was down by 0.48%.