Markets trade flat with positive bias in range-bound session

In the extremely range-bound session of trade, Indian equity benchmarks altering between positive and negative territory, were now trading flat with bit of positive bias as investors and foreign funds were adopting a cautious approach, ahead of key macroeconomic data IIP and inflation, to be released later in the day.  The broader markets were however, outperforming the benchmark indices- BSE Midcap and Smallcap indices were up by over 0.35% each. The sentiments got some support after the Finance Minister Jaitley emphasized that the Government of India is committed to a path of fiscal consolidation. Finance Minister said that the current account deficit (CAD) in the country has come down substantially to around 1.3 percent of GDP in 2014-15, which was around 4.8 percent two years earlier. Some support also came with Chief Economic Advisor Arvind Subramanian’s statement that growth in collection of indirect taxes in the first half of the current fiscal shows robust GDP expansion. Indirect tax collection increased 35.8 percent in the April-September period of the 2015-16 fiscal to Rs 3.24 lakh crore.

On the global front, Asian shares rose on Monday, as investors hunted for bargains in industrials and basic materials, fueled by a rebound in commodities. China's shares led the region's markets higher with Hong Kong and Shanghai up more than 1% each. On Wall Street, major indexes closed slightly higher on Friday, chalking up one of the best weekly performances so far this year. Back home, Indian Rupee edged higher by five paise to 64.69 against the dollar on increased selling of the US currency by banks and exporters amid sustained foreign fund inflows.

Back on street, stocks from Metal, Power and Auto counters were supporting the markets’ uptrend, while those from IT, TECK and FMCG counters were adding to the underlying cautious undertone. In scrip specific development, shares of Zensar Technologies have surged after the software and infrastructure services provider announced that the private equity group Apax Partners acquired a 23.2% stake in the company from Electra Partners Mauritius, an existing minority shareholder. On the flip side, shares of Bank of Baroda have declined on reports that the Central Bureau of Investigation (CBI) on Saturday carried out searches at the bank’s branches in New Delhi for alleged foreign exchange violations.

The market breadth on BSE was positive, out of 2169 stocks traded, 1251 stocks advanced, while 843 stocks declined on the BSE. 

The BSE Sensex is currently trading at 27101.95, up by 22.44 points or 0.08% after trading in a range of 27024.91 and 27305.04. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.47%, while Small cap index up by 0.39%.

The top gaining sectoral indices on the BSE were Metal up by 1.86%, Power up by 1.16%, Auto up by 0.86%, Capital Goods up by 0.80% and Bankex up by 0.79%, while IT down by 1.48%, TECK down by 1.15%, FMCG down by 0.35% and Realty down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Vedanta up by 6.42%, Hindalco up by 4.12%, Tata Steel up by 2.29%, Tata Motors up by 2.01% and BHEL up by 1.61%. On the flip side, Infosys down by 2.84%, Cipla down by 0.91%, HDFC down by 0.88%, Wipro down by 0.81% and Hindustan Unilever down by 0.59% were the top losers.

Meanwhile, Rating agency CRISIL in its report has said that India’s agriculture growth this fiscal is expected to be marginally better around 1.5 percent than 0.2 percent previous year despite poor monsoon, on the back of support from the allied sectors of horticulture and livestock. However the foodgrains production will be lower, the rest of the agriculture and allied category will provide cushion.

The reports further stated that the growth in livestock, fishing and aquaculture categories in the past has remained healthy at 5 to 5.5 per cent even in years of weak monsoon. These two sectors comprise nearly 27 per cent of the agriculture and allied sector GDP, and their growth rates could hold up this year too. Agriculture GDP comprises crops (foodgrains and horticulture), livestock, forestry and logging, fishing and aquaculture.

Besides, CRISIL in its report said that already rural incomes are dented due to falling wage growth. A below-par agriculture growth will have a telling impact on rural demand, which is already showing signs of faltering due to consecutive bad monsoon, falling product prices and stagnant wages. Another factor that has hurt is falling export prices of agriculture commodities. Almost half of India's GDP comes from rural areas. About 40 per cent of India's households engage in agriculture and within this group, two-thirds are heavily reliant on it.

The CNX Nifty is currently trading at 8194.70, up by 5.00 points or 0.06% after trading in a range of 8171.95 and 8244.50. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Vedanta up by 6.47%, Hindalco up by 3.75%, Tata Steel up by 2.19%, Tata Power up by 2.01% and Cairn India up by 1.99%. On the flip side, Bank of Baroda down by 4.31%, Infosys down by 2.91%, Cipla down by 1.28%, HDFC down by 0.98% and Wipro down by 0.90% were the top losers.

Asian markets were trading mostly in green; Jakarta Composite was up by 0.82%, Shanghai Composite was up by 3.6%, Taiwan Weighted was up by 1.27% and Hang Seng was up by 1.36%, while KOSPI Index was down by 0.15% and FTSE Bursa Malaysia KLCI was down by 0.22%.