Benchmarks continue to trade in green in late morning session

After getting a positive start, benchmark equity indices continued to trade firm in late morning session on sustained buying by funds and retail investors. Sentiments got a boost after India’s GDP growth accelerated to 7.4 per cent in the July-September quarter from 7 per cent in the previous quarter. Besides, further recovery in the rupee and widening of positions by participants ahead of the RBI’s fifth bi-monthly monetary policy review, to be released later today, also influenced the sentiment. Some support also came with Finance Minister Arun Jaitley’s statement that GDP in the current fiscal will be better than the growth rate recorded in the last financial year and improve further in subsequent years.  India's infrastructure output grew at 3.2% in October yoy unchanged from September but down from 9% a year ago. However, investors remained cautious on the report that India’s manufacturing sector grew at its weakest pace in over two years in November as demand and output continued to soften. Nikkei’s Manufacturing Purchasing Managers’ Index (PMI), compiled by Markit, fell to a 25-month low of 50.3 in November from October’s 50.7.

On the global front, Asian markets trading mostly in green as improved manufacturing in Japan offset weak Chinese data. The addition of the yuan to the IMF's basket of globally important currencies bolstered confidence China is making progress with financial and economic liberalization. However, US stocks closed lower on Monday, the last day of trade for November, as investors eyed retail results and readied for key data and central bank comments later in the week. After reporting decreases in US pending home sales in the two previous months, (NAR) released a report showing a slight uptick in pending sales in the month of October. Back home, stocks from Metal, Oil & Gas and Power counters were supporting the markets’ uptrend, while those from Auto counter was adding to the underlying cautious undertone.

In scrip specific development, shares of Shreyas Shipping & Logistics have surged after the company has received its board’s approval to enter into Memorandum of Understanding (MoU) for the formation of a Joint Venture Company (JVC) with Suzue Corporation, Japan for exploring business opportunities in the logistics space within India and Japan.  Furthermore, Tata Power gained after Maithon Power, a 74 per cent Joint Venture (JV) of Tata Power, issued and allotted senior, non-cumulative, redeemable, listed, rated, secured non-convertible Debentures (NCDs) for an amount of Rs 500 crore on private placement basis.

The market breadth on BSE was positive, out of 2327 stocks traded, 1393 stocks advanced, while 829 stocks declined on the BSE. 

The BSE Sensex is currently trading at 26189.61, up by 43.94 points or 0.17% after trading in a range of 26171.28 and 26246.02. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.52%, while Small cap index up by 0.48%.

The top gaining sectoral indices on the BSE were Metal up by 1.87%, Oil & Gas up by 0.91%, Power up by 0.79%, PSU up by 0.78%, FMCG up by 0.37%, while Auto down by 0.23% was the sole losing index on BSE.

The top gainers on the Sensex were Tata Steel up by 2.72%, Vedanta up by 2.44%, Dr. Reddys Lab up by 2.05%, Wipro up by 1.94% and Coal India up by 1.50%. On the flip side, Bharti Airtel down by 2.24%, Axis Bank down by 0.75%, Tata Motors down by 0.48%, Hero MotoCorp down by 0.38% and Infosys down by 0.32% were the top losers.

Meanwhile, the Gross Domestic Product (GDP) growth picking-up from 7.0 per cent in Q1 of 2015-16 grew by 7.4 percent in the second quarter (July-September) of 2015-16, majorly contributed by gross fixed capital formation, which added up to 29.9% of the total growth, rising by 6.8% from a year ago. The bulk of the increase in GDP was contributed by private consumption, which not only increased by 6.8% but accounted for 55.1% of the rise in GDP from a year ago. Also, government’s final consumption expenditure was up 5.2%, contributing as much as 10% to GDP growth.

As per the data released by the Central Statistics Office (CSO), Ministry of Statistics and Programme Implementation, Gross Domestic Product (GDP) for the second quarter (July-September) Q2 of 2015-16, GDP at constant (2011-12) prices in Q2 of 2015-16 was estimated at Rs 27.57 lakh crore, as against Rs 25.66 lakh crore in Q2 of 2014-15, showing a growth rate of 7.4 percent.  Quarterly GVA at Basic Price at constant (2011-12) prices for Q2 of 2015-16 was estimated at Rs 25.80 lakh crore, as against Rs 24.02 lakh crore in Q2 of 2014-15, showing a growth rate of 7.4 per cent over the corresponding quarter of previous year.

At current prices, GDP derived by adding taxes on products net of subsidies on products to GVA at basic prices, was estimated at Rs 32.66 lakh crore in Q2 of 2015-16, as against Rs 30.80 lakh crore in Q2 of 2014-15, showing a growth rate of 6.0 percent. GVA at basic price at current prices in Q2 of 2015-16, was estimated at Rs 30.26 lakh crore, as against Rs 28.76 lakh crore in Q2, 2014-15, showing an increase of 5.2 per cent.

The economic activities which registered growth of over 7.0 percent in Q2 of 2015-16 over Q2 of 2014-15 on are ‘trade, hotels and transport & communication and services related to broadcasting’, 'financial, insurance, real estate and professional services' and ‘manufacturing’. The growth in the ‘agriculture, forestry and fishing’, ‘mining and quarrying’, ‘electricity, gas, water supply & other utility services, ‘construction’  and 'public administration, defence and other services’  is estimated to be 2.2 per cent, 3.2 percent, 6.7 per cent,  2.6 per cent and 4.7 per cent, respectively, during this period.

The government expects the economy to grow in the vicinity of 7.5% during the current Financial Year 2015-16. Finance Ministry observed that the growth is being mainly driven by pick-up in the manufacturing sector, which has grown by 9.3 per cent in the Second Quarter. Similarly, the Fixed Investment is showing a sign of revival as it has grown by 6.8 per cent in the Second Quarter of current Financial Year 2015-16. Further, the Service Sector growth is still robust at 8.8 per cent in Q2 of 2015-16.

The CNX Nifty is currently trading at 7956.35, up by 21.10 points or 0.27% after trading in a range of 7950.55 and 7972.05. There were 35 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 2.96%, Vedanta up by 2.61%, Ultratech Cement up by 2.49%, Dr. Reddys Lab up by 2.16% and Ambuja Cement up by 1.99%. On the flip side, Bharti Airtel down by 2.18%, Bank Of Baroda down by 1.06%, Axis Bank down by 0.87%, Maruti Suzuki down by 0.80% and Adani Ports &Special down by 0.60% were the top losers.

Asian markets were trading mostly in green, FTSE Bursa Malaysia KLCI was up by 0.3%, KOSPI Index up by 1.44%, Jakarta Composite up by 1.67%, Taiwan Weighted up by 1.46%, Nikkei 225 up by 0.89% and Hang Seng up by 1.66%. On the flip side, Shanghai Composite was down by 0.43%.