Benchmarks continue firm trade in late afternoon session

Indian equity markets continued their firm trade in the late afternoon session on account of buying in front line blue chip counters taking cues from global counterparts. The sentiments were on optimistic note with Chief Economic Adviser Arvind Subramanian’s statement that inflation is completely under control and it is well within the target of the Reserve Bank. The sentiments also got some support after the rupee recovered against the dollar in early trade at the Interbank Foreign Exchange on increased selling of the US currency by exporters and banks amid higher opening in the domestic equity market. Traders were seen piling position in Bankex, Oil & Gas and Consumer Durables stocks. In the scrip specific development, Eros International Media was trading firm on reports that the company may go for a share buyback. Dr. Reddy’s Laboratories was trading in red after the US law firm Lundin Law makes class action appeal over allegations of misleading statements from the Indian drugmaker.

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 7,800 and 25,700 levels respectively. The market breadth on BSE was positive in the ratio of 1681:857 while 188 scrips remained unchanged.

The BSE Sensex is currently trading at 25797.00, up by 314.48 points or 1.23% after trading in a range of 25603.10 and 25854.51. There were 27 stocks advancing against 3 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.00%, while Small cap index up by 1.06%.

The gaining sectoral indices on the BSE were Bankex up by 1.49%, Oil & Gas up by 1.48%, Consumer Durables up by 1.44%, Auto up by 1.44%, IT up by 1.24%.

The top gainers on the Sensex were Bajaj Auto up by 3.12%, ICICI Bank up by 2.59%, Reliance Industries up by 2.53%, HDFC up by 2.31% and Maruti Suzuki up by 2.29%.
On the flip side, Dr. Reddy’s Lab down by 2.77%, Sun Pharma down by 0.86% and Coal India down by 0.21% were the top losers.

Meanwhile, in order to bridge the yawning revenue gap and meet the disinvestment targets, the Union Cabinet has approved a 10 per cent stake sale in Coal India (CIL), one of the country's highest dividend paying companies. The government is facing ignominy of missing the disinvestment target for the sixth year, with so far raking up just 18 per cent of the Rs 69,500 crore disinvestment target in the current fiscal.

The stake sale in Coal India will be carried out through the offer for sale mechanism, the timing of which will be decided by the finance ministry.  At the current market price, a 10 per cent stake sale could fetch around Rs 21000 crore. This would still be lower than the Rs 22,600 crore that the Centre raised in the last financial year from a 10 per cent sale in the public sector behemoth. It was the largest single stake sale of a public sector firm by the government ever. The government is in the process of appointing merchant bankers for stake sale in Coal India, in which it currently holds 78.65% share.

For the current financial year, the government has budgeted to raise Rs 69,500 crore through disinvestment. Of this, Rs 41,000 crore is to come from minority stake sale in PSUs and the remaining Rs 28,500 crore from strategic stake sale. For April- October month of the ongoing fiscal, the government has been able to raise Rs 12,600 crore through stale sale in four PSUs as volatile market conditions have dented disinvestment plans. For disinvestment in 2015-16, the government has a pipeline of over 20 PSUs for which it has the Cabinet approval. These include 10 per cent stake sale each in OIL, Nalco, NMDC, and 5 per cent each in NTPC, ONGC and BHEL.

The CNX Nifty is currently trading at 7827.60, up by 95.80 points or 1.24% after trading in a range of 7765.45 and 7844.35. There were 43 stocks advancing against 7 stocks declining on the index.

The top gainers on Nifty were Bajaj Auto up by 3.42%, Tech Mahindra up by 2.94%, HCL Tech up by 2.89%, Zee Entertainment up by 2.72% and Reliance Industries up by 2.61%.

On the flip side, Dr. Reddy’s Lab down by 2.58%, Idea Cellular down by 1.63%, Sun Pharma down by 0.96%, Coal India down by 0.36% and Bank of Baroda down by 0.27% were the top losers.

The Asian markets were trading in green; FTSE Bursa Malaysia KLCI increased 4.92 points or 0.3% to 1,661.42, KOSPI Index increased 26.03 points or 1.33% to 1,988.91, Jakarta Composite increased 30.08 points or 0.67% to 4,527.99, Shanghai Composite increased 48.59 points or 1.36% to 3,617.06, Taiwan Weighted increased 136.73 points or 1.64% to 8,477.20, Nikkei 225 increased 210.63 points or 1.07% to 19,859.81 and Hang Seng increased 311.96 points or 1.41% to 22,500.22.

The European markets were trading in green; UK’s FTSE 100 increased 53.82 points or 0.86% to 6,332.79, France’s CAC increased 45.29 points or 0.92% to 4,952.01 and Germany’s DAX increased 153.16 points or 1.4% to 11,113.11.