Benchmarks continue firm trade in late afternoon session

Indian equity markets extend their gains in the late afternoon session on account of buying in frontline blue chip counters. The sentiments were on optimistic note on reports that the government may extend export incentives such as cheap credit to even large players in sectors like pharmaceuticals, chemicals and electronics. ASSOCHAM has approached the government for incentives like a cut in excise duty, teaser loans for housing and interest subvention for exporters, saying that sectors like real estate, power, steel, gems and jewellery are in a real crisis. Traders were seen piling position in Capital Goods, Bankex and Power stocks. In the scrip specific development, Maruti Suzuki India was trading in red after global investment bank downgraded the company to underperform from buy.

On the global front, the Asian markets were trading in green, while the European markets were trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,050 and 26,700 levels respectively. The market breadth on BSE was positive in the ratio of 1884:745 while 99 scrips remained unchanged.

The BSE Sensex is currently trading at 26709.34, up by 488.39 points or 1.86% after trading in a range of 26375.31 and 26719.12. There were 24 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.51%, while Small cap index up by 1.53%.

The gaining sectoral indices on the BSE were Capital Goods up by 3.12%, Bankex up by 2.42%, Power up by 2.35%, Metal up by 2.04% and Auto up by 1.95%.

The top gainers on the Sensex were Tata Motors up by 6.68%, HDFC up by 4.55%, Tata Steel up by 4.50%, Hindalco up by 4.46% and Larsen & Toubro up by 4.14%.

On the flip side, Maruti Suzuki down by 3.47%, Dr. Reddy’s Lab down by 1.16%, Lupin down by 1.08%, Hindustan Unilever down by 0.85% and Wipro down by 0.30% were the top losers.

Meanwhile, Economic Affairs Secretary Shaktikanta Das has said that the government is looking to simplify foreign direct investment (FDI) policy with an aim to remove some of the conditions that investors need to fulfill while investing in the country as it looks to further ease procedures to attract more investment, including domestic, at a time when the RBI has cut rates too. The government will not just look at increasing FDI limits in sectors but also put more sectors on the automatic route, among other measures.

Das said that Foreign Investment Promotion Board (FIPB) will now meet twice a month to speed up approvals, signaling the clear intent of the government in order to push ahead the reforms on a wide range of issues. Das further said that the Sectoral caps need to be revised and the process of approval should be automatic unless there are security concerns or in sensitive sectors.

Das said that the FIPB presently meets an average of once every month while the entire approval process take more than three months even for investments of a few crores of rupees. Besides, the current policy has sectors in which no investment is allowed while others are open to levels such as 26 per cent, 49 per cent, 74 per cent and 100 per cent, depending on how sensitive they are. The policy document, which is more than 120 pages long, has a number of conditions for every sector.

The CNX Nifty is currently trading at 8093.75, up by 142.85 points or 1.80% after trading in a range of 8005.10 and 8097.60. There were 41 stocks advancing against 8 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 6.60%, HDFC up by 4.75%, Tata Steel up by 4.62%, Bosch up by 4.57% and Hindalco up by 4.02%.

On the flip side, Maruti Suzuki down by 3.46%, Dr. Reddy’s Lab down by 1.25%, Lupin down by 1.13%, Hindustan Unilever down by 1.09% and Sun Pharma down by 0.40% were the top losers.

The Asian markets were trading in green; KOSPI Index increased 8.57 points or 0.44% to 1,978.25, FTSE Bursa Malaysia KLCI increased 16.49 points or 1.01% to 1,645.29, Straits Times increased 46.66 points or 1.67% to 2,839.81, Taiwan Weighted increased 47.33 points or 0.57% to 8,352.36, Jakarta Composite increased 136.32 points or 3.24% to 4,344.12, Nikkei 225 increased 280.36 points or 1.58% to 18,005.49 and Hang Seng increased 348.41 points or 1.62% to 21,854.50.

China Stock exchange was closed on account of ‘National Day’ holiday.

The European markets were trading in green; UK’s FTSE 100 increased 122.26 points or 1.99% to 6,252.24, France’s CAC increased 125.66 points or 2.82% to 4,584.54 and Germany’s DAX increased 210.99 points or 2.21% to 9,764.06.