Benchmarks extend gains; Nifty above 8550 mark

Indian equity benchmarks extended early gains to continue firm trade in late morning session, hovering near intra-day high level on back of sustained buying by funds and investors after major car makers posted healthy sales growth in July. Sentiment got a boost after India's manufacturing sector improved at the fastest pace in six months in July, driven by solid rises in new work and output. The seasonally adjusted Nikkei India Manufacturing Purchasing Managers’ Index (PMI)-a composite single-figure indicator of manufacturing performance came at a six-month high of 52.7 in July, from 51.3 in June. The S&P BSE Sensex reclaimed its crucial psychological level of 28200, while Nifty too surged past its important resistance level of 8550 and were trading firmly over it. Apart from blue chips, broader indices too equally participated in the rally with both mid cap and small cap indices trading up by 0.95% and 0.88% respectively. Sentiment remained upbeat as buying activity gathered momentum on expectations that liquidity may pick up as EPFO will start investing in the equity market this week. However, weakness in the Asian peers amid signs of a deepening slowdown in China's economy has capped the upside.

On global front, Asian markets were trading mostly in red as China shares were dragged down by poor manufacturing figures and investors followed a drop on Wall Street. The survey of Chinese manufacturing activity showed a drop to a two-year low in July, suggesting the world's second largest economy faces challenges in the third quarter. Back home, Indian rupee recovered 17 paise to 63.96 against the dollar in the early trade, snapping its two-day losing run, on fresh selling of the US currency by exporters amid fall in global crude prices.

Back on street, stocks from Banking, Consumer Durables and Realty counters were supporting the markets’ uptrend, while those from Metal, Capital Goods and IT counters was adding to the underlying cautious undertone. In scrip specific development, Shares of Maruti Suzuki India have surged after the company reported a strong 20% year-on-year (Y-o-Y) growth in July sales at 1.22 lakh units, aided by passenger cars sales. On the flip side, shares of HCL Technologies have declined after the company's net profit dipped sequentially by 5.9% to Rs 1,783 crore for the quarter ended June 30, 2015.

The market breadth on BSE was positive, out of 2351 stocks traded, 1565 stocks advanced, while 709 stocks declined on the BSE. 

The BSE Sensex is currently trading at 28202.42, up by 87.86 points or 0.31% after trading in a range of 28071.37 and 28222.38. 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 0.95%, while Small cap index up by 0.88%.

The top gaining sectoral indices on the BSE were Bankex up by 1.38%, Consumer Durables up by 1.10%, Realty up by 1.05%, Power up by 0.98% and Auto up by 0.77%, while Metal down by 0.49%, Capital Goods down by 0.39%, IT down by 0.22%, Oil & Gas down by 0.05% and Teck down by 0.03% were the top losing indices on BSE.

The top gainers on the Sensex were SBI up by 3.90%, Tata Motors up by 2.25%, Maruti Suzuki up by 2.18%, ICICI Bank up by 1.87% and Axis Bank up by 0.99%. On the flip side, Hero MotoCorp down by 1.89%, Larsen & Toubro down by 1.65%, Coal India down by 1.51%, Mahindra & Mahindra down by 1.41% and Hindustan Unilever down by 1.27% were the top losers.

Meanwhile, for the third time in a row, prices of Petrol and Diesel were cut by Rs 2.43 and 3.60 per litre respectively, on account of reduction in international crude prices in the Month of July. The new rates announced by the oil marketing companies (OMCs) were effective from August 1, 2015. As a result, Petrol price in Delhi got reduced to Rs 64.47 per litre from Rs 66.90 per litre earlier, while diesel was cut to Rs 46.12 per litre against Rs 49.72 per litre.

Earlier on July 16, prices of Petrol and Diesel were cut by Rs 2 per litre each, excluding local sales tax.  The OMCs have said that since the last price change, there has been a decrease in international prices of both petrol and diesel, while the rupee-dollar exchange rate, depreciated during this period. The combined impact of both these factors warranted a downward revision in prices, the impact of which is being passed on to the consumers with this price decrease.

PSU oil marketing companies Indian Oil Corporation (IOC), Bharat Petroleum Corp (BPCL) and Hindustan Petroleum Corp (HPCL) revise petrol and diesel prices on 1st and 16th of every month based on average imported cost and rupee-dollar exchange rate in the previous fortnight.

The CNX Nifty is currently trading at 8554.15, up by 21.30 points or 0.25% after trading in a range of 8508.10 and 8562.30. There were 32 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Bank of Baroda up by 6.68%, SBI up by 4.18%, PNB up by 3.34%, Tata Motors up by 2.38% and Maruti Suzuki up by 2.25%. On the flip side, HCL Tech down by 4.88%, Hero MotoCorp down by 2.29%, Larsen & Toubro down by 1.78%, Mahindra & Mahindra down by 1.62% and Hindustan Unilever down by 1.50% were the top losers.

Asian markets were trading mostly in red; Hang Seng was down by 1.07%, Taiwan Weighted down by 1.7%, Shanghai Composite down by 2.43%, Nikkei 225 down by 0.43%, KOSPI Index down by 1.03%, Straits Times down by 0.18% and FTSE Bursa Malaysia KLCI down by 0.09%. On the other hand, Jakarta Composite was up by 0.2%.