Indian Equity markets trade in fine fettle in early deals on Thursday

Indian equity benchmarks have made a positive start and are trading in fine fettle in early deals on Thursday after the Federal Reserve post the two-day FOMC meet kept the interest rates steady at zero and indicated it may hike interest rates in September. At present, Sensex and Nifty were trading above the crucial 27,050 and 8,150 levels respectively, with gains of about a percentage point. Apart from blue chips, broader indices too equally participated in the rally with both mid cap and small cap indices trading up by 0.70% and 0.85% respectively. Investors’ sentiment was up-beat with report that the Finance Ministry has set up two committees to suggest tax rates and look into IT preparedness for the new indirect tax regime in its bid to roll out GST from April 1, 2016.  Further, some support also came on report that the government has approved 16 proposals of Foreign Direct Investment (FDI), including those of Torrent Pharmaceuticals and Star India, amounting to Rs 6,750.86 crore.

In scrip specific development, Orchid Chemicals & Pharmaceuticals was trading higher, extending its previous day’s gain, after the company received nod from the United States Food and Drug Administration (USFDA) for generic anti-bacterial Gemifloxacin Mesylate tablets while, Strides Arcolab was trading lower after the government has rejected FDI proposal of pharmaceutical company.

On the global front, the US markets ended higher following a choppy session after the Federal Reserve said the US economy is likely strong enough to withstand an interest rate hike later this year. Asian markets were mostly trading in red ahead of a Bank of Japan’s policy meeting.

Back home traders were seen piling position in Oil & Gas, Capital Goods, Bankex, Auto and Healthcare while, selling was witnessed in INFRA. The market breadth on BSE was positive in the ratio of 1197: 493 while 69 scrips remained unchanged.

The BSE Sensex is currently trading at 27080.11, up by 247.45 points or 0.92% after trading in a range of 26910.26 and 27085.53. There were 29 stocks advancing against 1 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.70%, while Small cap index up by 0.85%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.15%, Capital Goods up by 1.09%, Bankex up by 0.95%, Auto up by 0.87% and Healthcare up by 0.82% while, INFRA down by 0.26% was  the losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 1.64%, BHEL up by 1.45%, Mahindra & Mahindra up by 1.42%, Wipro up by 1.21% and ICICI Bank up by 1.16%. On the flip side, Bharti Airtel down by 0.26% were the top losers.

Meanwhile, in line with the announcement last year that the new crop insurance scheme will be in place next year, the government is going to launch a new crop insurance scheme with a clause guaranteeing minimum income to cultivators, in case of a natural calamity. Agriculture Minister Radha Mohan Singh has said that the new scheme is going to entail minimum income clause for farmers.

He further informed that the Centre has started discussion with states and all stakeholders on further improving upon the insurance product, which would not only ensure the farmers against yield loss but also provide security for their income.

The Agriculture minister also said that Centre is examining the issue of rising premiums under the existing crop insurance programme, adding that “The issues of rising premium rates under existing crop insurance programme are being examined and we have to make efforts for bringing the premium rates at a reasonable level which could be affordable to the farmers.”

A Comprehensive Crop Insurance Scheme 'National Agricultural Insurance Scheme' (NAIS) was started from 1999-2000 but the scheme could not translate into actuarial regime as conceptualized, later National Crop Insurance Programme (NCIP) was introduced from 2013-14 with different components to compensate farmers differently by using different methodology for computing crop losses to farmers. Some of the states adopted the MNAIS (modified NAIS) and some states have expressed few reservations about its implementation. Hence, states have been allowed to implement MNAIS or NAIS on their choice.

The CNX Nifty is currently trading at 8156.50, up by 64.95 points or 0.80% after trading in a range of 8101.80 and 8157.00. There were 45 stocks advancing against 5 stocks declining on the index.

The top gainers on Nifty were Asian Paints up by 2.59%, BPCL up by 1.86%, Reliance Industries up by 1.68%, BHEL up by 1.58% and Vedanta up by 1.33%. On the flip side, Tech Mahindra down by 0.86%, Bharti Airtel down by 0.47%, Cairn India down by 0.20% and Yes Bank down by 0.13% were the top losers.

Asian markets were mostly trading in red; Hang Seng decreased 36.33 points or 0.14% to 26,717.46, Straits Times decreased 10.8 points or 0.32% to 3,315.11, Shanghai Composite decreased 8.85 points or 0.18% to 4,959.05, FTSE Bursa Malaysia KLCI decreased 2.84 points or 0.16% to 1,724.02 and Nikkei 225 decreased 142.44 points or 0.7% to 20,076.83.

On the flip side, Jakarta Composite increased 5.67 points or 0.11% to 4,951.43, KOSPI Index increased 12.86 points or 0.63% to 2,047.72 and Taiwan Weighted increased 32.98 points or 0.36% to 9,222.81.