Markets maintain strong gains; oil & gas takes the charge

Markets extending their bullishness were holding their heads high in the early noon session, there was across the board buying activity that had helped the benchmarks reclaim the crucial psychological levels of 27000 (Sensex) and 8150 (Nifty). The main jubilation was enticed with the US Federal Reserve sounding more dovish than expected, with hopes of a push back in timings of rate hike. On the domestic front too, there were lots of government announcements that have encouraged the marketmen for putting bets on the Indian growth story. Government gave its approval for the launch of the ‘Housing for All by 2022’ scheme. The Union Cabinet chaired by Prime Minister Narendra Modi accepted the recommendations of an Inter-Ministerial Committee to increase interest subvention to 6.50 per cent on housing loans to beneficiaries belonging to economic weaker section (EWS) including slum-dwellers and low income groups (LIGs). On the same time moving a step further in implementation of GST by April 1, 2016, the Finance Ministry has set up two committees to suggest tax rates and look into IT preparedness for the new indirect tax regime. Back on street, the broader indices were going neck-in-neck to the benchmarks, while almost all the sectoral indices were moving in green terrain led by oil & gas, consumer durables, banking and capital goods.

The BSE Sensex is currently trading at 27077.48, up by 244.82 points or 0.91% after trading in a range of 26910.26 and 27123.76. There were 25 stocks advancing against 5 stocks declining on the index.

The broader indices were maintaining their pace; the BSE Mid cap index was up by 0.63%, while Small cap index gained 1.11%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.80%, Consumer Durables up by 1.30%, Bankex up by 1.00%, Capital Goods up by 0.84%, PSU up by 0.77%, while Realty down by 0.25% and INFRA down by 0.14% were the losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 3.43%, Bharti Airtel up by 2.01%, Tata Motors up by 1.82%, HDFC Bank up by 1.51% and SBI up by 1.49%. On the flip side, Cipla down by 1.14%, Tata Power down by 1.10%, Tata Steel down by 0.52%, NTPC down by 0.26% and Hindustan Unilever down by 0.09% were the top losers.

Meanwhile, giving the much needed relief to the domestic steel manufacturers, the government has increased the basic customs duty (BCD) on certain long and flat steel products by 2.5 percent. The Central Board of Excise and Customs (CBEC) in its notification said that import duty on flat steel products has been increased to 10 percent from 7.5 percent, whereas that on long steel products has been raised to 7.5 percent from 5 percent.

The products include, non-alloy flat products, alloy sheet flat, semis, non-alloy and large alloy flat, among others. Duty on flat products of steel like hot and cold rolled (HR/CR) sheets and coils typically used in automobiles, refrigerators and washing machines were revised upwards from 7.5% to 10%. On long products of steel like TMT bars, angles and channels, used in building and construction, duty has been raised from 5% to 7.5%. The two exceptions were duty has been maintained at existing levels are -CRGO (cold rolled grain oriented) steel or 'electrical steels' that few domestic players manufacture and stainless steel flat products.

Alarmed by the excess steel capacity in China that was leading to dumping, Steel and Mines Minister Narendra Singh Tomar had pressed the finance ministry to raise import duty as a measure to safeguard domestic industry. Indian Steel Alliance (ISA), an industry body of private and public steel producers too had been long lobbying for a duty hike. Imports, which have been clocking almost 1 mt per month since September 2014, remained unabated, going up 43% in April and 85% in May 2015. Against this, Chinese imports had amounted to 1.08 mt in 2013-14 when total steel imports touched 5.45 mt.

The decision, comes on top of recent imposition of anti-dumping duty on some grades of stainless steel. India slapped anti-dumping duty of up to $316 per tonne on imports of certain steel products from three countries, including China, to protect domestic producers from below-cost inbound shipments.

The CNX Nifty is currently trading at 8150.90, up by 59.35 points or 0.73% after trading in a range of 8101.80 and 8166.35. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Reliance Industries up by 3.41%, BPCL up by 2.36%, Asian Paints up by 2.25%, Tata Motors up by 1.81% and Lupin up by 1.55%. On the flip side, NMDC down by 1.31%, Cipla down by 1.22%, Ultratech Cement down by 1.13%, Zee Entertainment down by 1.10% and Tata Power down by 0.96% were the top losers.

Asian markets were showing a mixed trend, KOSPI Index was up by 7.02 points or 0.34% to 2,041.88, Hang Seng gained 7.74 points or 0.03% to 26,761.53 and Taiwan Weighted increased 28.54 points or 0.31% to 9,218.37.

On the other hand, Nikkei 225 slumped by 228.45 points or 1.13% to 19,990.82, Shanghai Composite lost 50.79 points or 1.02% to 4,917.11, Straits Times was down by 23.13 points or 0.7% to 3,302.78, FTSE Bursa Malaysia KLCI declined by 2.4 points or 0.14% to 1,724.46 and Jakarta Composite was tad lower by 0.37 points to 4,945.38.