Benchmarks make gap-up opening; Nifty reclaims 8,200 mark

With a gap-up opening Indian equity markets have recovered all their previous session losses and are now trading in fine fettle with the gains of over a percent, following strength in the global peers. Sustained buying in all the key heavyweights along with broader indices supported BSE’s -- Sensex -- and NSE’s -- Nifty -- to regain their crucial 27,100 and 8,200 mark respectively. The sentiment got a boost with the Central Board of Excise and Customs statement that GST can be implemented anytime during a year and not only at the beginning of a financial year. GST, once rolled out, will subsume various levies like excise, service tax, sales tax, octroi, etc. Further, appreciation in Indian rupee against dollar too was supporting the sentiments. The rupee rose by 16 paise to 64.90 against the US dollar in early trade today at the Interbank Foreign Exchange following the minutes of the Fed's September 16-17 policy review showed that US policymakers were concerned about the slowing world economy even though they did not rule out a rate hike in 2015.

In the scrip specific development, 8K Miles Software Services surged 5% on the BSE, after reporting more-than-double consolidated net profit at Rs 8.74 crore for the second quarter ended September 2015 on back of strong operational income.

On the global front, the US markets ended higher in reaction to the minutes of the latest Federal Reserve meeting, which further offset recent uncertainty about the outlook for interest rates. The Asian markets were trading in green tracking the overnight surge in crude oil prices and the gains on Wall Street after minutes of the latest Federal Reserve meeting reinforced the view that the central bank may delay its first interest rate hike into next year.

Closer home, all the sectoral indices on the BSE were trading in green led by Capital Goods, Bankex, Realty and IT. The market breadth on BSE was positive in the ratio of 1314: 348 while 53 scrips remained unchanged. 

The BSE Sensex is currently trading at 27136.20, up by 290.39 points or 1.08% after trading in a range of 26973.58 and 27171.19. There were 28 stocks advancing against 2 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.77%, while Small cap index gained 0.92%.

The top gaining sectoral indices on the BSE were Capital Goods up by 1.24%, Bankex up by 1.18%, Realty up by 1.16%, IT up by 1.14%, Metal up by 1.00%, while there were no losers.

The top gainers on the Sensex were Vedanta up by 5.44%, Hindalco up by 2.31%, ICICI Bank up by 2.28%, Bajaj Auto up by 1.94% and ONGC up by 1.75%. On the flip side, Coal India down by 1.16% and Tata Motors down by 0.12% were the top losers.

Meanwhile, amid repeated push of the government for financial inclusion, RBI Governor Raghuram Rajan sounded a cautious note and has said that financial inclusion should not be pressed beyond a point because beneficiaries may not have the capacity to make use of funds being made available to them.

Rajan who was speaking on the sidelines of IMF-World Bank meetings, said that pushing financial inclusion beyond a point can have negative impact because people at the bottom of pyramid do not have capacity to absorb credit. He said “In my sense, beyond a certain point... (financial inclusion) becomes actually negative,” he said, adding that everyone should not be pushed to borrow.

RBI governor also emphasized that technology and e-model could be used for improving businesses at remote centres and made a strong case for developing capacities to deal with the misuse of technology by criminal elements.

Recently, sticking to its theme of financial inclusion and making credit available for small borrowers, the Reserve Bank of India granted in-principle licences to set up small finance banks to 10 applicants, all microfinance companies.

The CNX Nifty is currently trading at 8214.40, up by 85.05 points or 1.05% after trading in a range of 8182.95 and 8224.10. There were 47 stocks advancing against 3 stocks declining on the index.

The top gainers on Nifty were Vedanta up by 5.60%, ICICI Bank up by 2.48%, Bajaj Auto up by 2.07%, Hindalco up by 2.00% and ONGC up by 1.98%. On the flip side, Coal India down by 0.84%, Asian Paints down by 0.41% and Tata Motors down by 0.15% were the top losers.

Asian markets were trading in green, FTSE Bursa Malaysia KLCI increased 19.33 points or 1.14% to 1,711.53, Shanghai Composite increased 21.9 points or 0.7% to 3,165.26, Straits Times increased 44.98 points or 1.53% to 2,992.01, Jakarta Composite increased 109.17 points or 2.43% to 4,600.60, Nikkei 225 increased 182.28 points or 1% to 18,323.45 and Hang Seng increased 436.08 points or 1.95% to 22,790.99.