Markets retain gains supported by infra and oil & gas

Markets are retaining their morning gains in the early noon trade, with no sign of any major profit taking yet. Though, markets are off the day’s high but hefty short covering is being witnessed across the board and not only the bluechips but the broader markets too are moving considerably higher, while the Sensex has reclaimed 26000 level, Nifty was slightly lower of 7900 mark. The gains in the local as well as the global markets has been induced by the statement of a top official of Federal Reserve that a September rate hike from the US agency looks “less compelling”. Traders were also getting some support with the gains in the rupee, which has once again slipped below 66 mark against the dollar after RBI governor Raghuram Rajan said that he was not in favour of depreciating the rupee and joining a global wave of monetary measures that have weakened currencies. All the sectoral indices on the BSE were trading in green, led by oil & gas and infra. Infra sector was especially in jubilant mood after the Centre allowed road developers to completely exit BOT (build-operate-transfer) projects two years after completion and invest the funds in incomplete highway projects, power plants or retire debt.

The BSE Sensex is currently trading at 26031.89, up by 317.23 points or 1.23% after trading in a range of 25943.75 and 26170.39. There were 23 stocks advancing against 7 stocks declining on the index.

The broader indices were outperforming the benchmarks; the BSE Mid cap index was up by 1.63%, while Small cap index surged by 1.89%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 2.33%, INFRA up by 1.81%, Consumer Durables up by 1.58%, Realty up by 1.40%, PSU up by 1.35%

The top gainers on the Sensex were HDFC up by 6.17%, Vedanta up by 5.67%, Cipla up by 3.61%, Lupin up by 2.55% and Infosys up by 1.91%. On the flip side, BHEL down by 3.62%, Bajaj Auto down by 2.07%, Hero MotoCorp down by 0.92%, Hindalco down by 0.68% and Tata Motors down by 0.43% were the top losers.

Meanwhile, the draft aviation policy, which is waiting to see the light of the day since long is likely to get delayed further, as certain provisions including easing of international flying norm for domestic carriers, are expected to be reworked. Prime Minister Narendra Modi after reviewing the draft has said that the financial aspects of various proposals being included in the civil aviation policy must be considered before making them a part of the policy so that the exchequer is not burdened.

In the meeting which was also attended by Civil Aviation Minister Ashok Gajapathi Raju, Finance Minister Arun Jaitley and Transport Minister Nitin Gadkari, among others, PM called for evolving a consensus among the various stakeholders before the government takes a final view on the 5/20 rule. The rule stipulates that a domestic airline must have completed five years of domestic operations and have a fleet of 20 aircraft before it is considered eligible to fly abroad.

An earlier version of the policy, launched in November last year, was unanimously opposed by the industry and couldn't be launched after much criticism. Now the aviation ministry has been asked to rework many of the provisions in the aviation policy draft, including the one relating to easing of 5/20 norm. While among the issues which could have a financial impact, include offering infrastructure status to the aviation sector which will ensure credit at lower rates of interest to the sector, and the issue of viability gap funding where the state will make funds available for airlines to operate on certain unviable routes.

The CNX Nifty is currently trading at 7892.40, up by 100.55 points or 1.29% after trading in a range of 7862.30 and 7930.80. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Cairn India up by 7.90%, HDFC up by 6.12%, Vedanta up by 5.84%, Ambuja Cement up by 4.01% and Cipla up by 3.60%. On the flip side, BHEL down by 3.66%, Bajaj Auto down by 2.50%, Yes Bank down by 1.18%, Zee Entertainment down by 1.04% and Hero MotoCorp down by 0.95% were the top losers.

The Asian markets, barring the Chinese Shanghai Composite which decreased by 11.05 points or 0.38% to 2,916.24 are trading in green.

KOSPI Index was up by 13.91 points or 0.73% to 1,908.00, FTSE Bursa Malaysia KLCI added 16.33 points or 1.03% to 1,596.70, Straits Times was higher by 52.99 points or 1.84% to 2,925.99, Taiwan Weighted inched up by108.96 points or 1.41% to 7,824.55, Jakarta Composite surged by138.79 points or 3.28% to 4,376.52, Nikkei 225 moved higher by 197.61 points or 1.08% to 18,574.44 and Hang Seng gained 342.01 points or 1.62% to 21,422.40.