Benchmarks trade in green; Metal, FMCG lead

Indian equity markets continued their firm trade in the late afternoon session on account of buying in frontline blue chip counters. The sentiments were on upbeat note from the early trade after India’s gross domestic product (GDP) for the three-month period ended September 30 grew 7.4%, slightly higher than the 7% in the previous quarter, with a boost from manufacturing and financial services.  Sentiments improved further 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, market participants 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 shares were solidly higher, shrugging off one Chinese factory survey that did little to ease persistent concerns about cooling growth in the economy, while a private survey showed a hint of stabilisation.  Further, European stocks were mixed on Tuesday, amid growing uncertainty over whether the European Central Bank will announce additional stimulus measures at its policy meeting this week. Back home, traders were seen piling position in Metal, FMCG and PSU stocks, while selling was witnessed in Auto, TECK and Banking sector stocks. In the scrip specific development, shares of Steel Strips Wheels have surged after the company has secured export order from Jaguar Land Rover (JLR) for an undisclosed amount. Furthermore, Jubilant Life Sciences has rallied after the company has received approval Paroxetine tablets, the generic version of Paxil tablets, which is used as an antidepressant.

The BSE Sensex is currently trading at 26168.47, up by 22.80 points or 0.09% after trading in a range of 26121.52 and 26246.02. There were 16 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.59%, while Small cap index up by 0.39%.

The top gaining sectoral indices on the BSE were Metal up by 2.79%, FMCG up by 0.90%, PSU up by 0.87%, Oil & Gas up by 0.86%, Power up by 0.45%, while Auto down by 0.58%, TECK down by 0.15%, Bankex down by 0.12%, Capital Goods down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Vedanta up by 4.16%, Tata Steel up by 3.46%, Hindalco up by 3.05%, Dr. Reddys Lab up by 3.04% and Hindustan Unilever up by 2.84%. On the flip side, Bharti Airtel down by 3.27%, Axis Bank down by 1.84%, GAIL India down by 1.63%, Tata Motors down by 1.39% and Infosys down by 0.86% were the top losers.

Meanwhile, showing a tepid manufacturing growth across India, the seasonally adjusted Nikkei India Manufacturing Purchasing Managers’ Index fell for the fourth consecutive month, and came at a 25-month low of 50.3 in November compared to 50.7 in October. Although, it was the 25th month of expansion but the data showed slower increases in incoming new business and output, while subdued demand growth led firms to keep workforce numbers broadly unchanged. (A reading above 50 marks expansion of the sector, while a score below this level means contraction)

The survey respondents indicated that new business inflows rose in November, marking a 25-month sequence of expansion. Though, there were reports that growth of new work was hampered by subdued domestic demand and competitive pressures. Mirroring the trend for new orders, production increased at the softest pace in the current 25-month sequence of expansion.

Following a marginal increase in the prior month, manufacturing employment in India was broadly unchanged in November and companies kept payroll numbers largely unchanged, with employment index recording only fractionally above the no-change mark of 50.0.

The survey highlighted a marginal improvement in business conditions across the sector. Subsector data highlighted consumer goods as the best performing category, while operating conditions at intermediate goods companies deteriorated for the first time since December 2013.Also, the Inventory levels decreased during November. Stocks of purchases declined for the first time in one-and-a-half years, while the Input cost inflation accelerated to the strongest in six months during November. Meanwhile, input cost inflation accelerated to the strongest since May, whereas factory gate prices were raised at a weaker rate that was marginal overall.

The CNX Nifty is currently trading at 7953.80, up by 18.55 points or 0.23% after trading in a range of 7934.15 and 7972.15. There were 32 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Vedanta up by 4.11%, Tata Steel up by 3.51%, Dr. Reddys Lab up by 3.22%, Hindalco up by 3.11% and Hindustan Unilever up by 2.98%. On the flip side, Bharti Airtel down by 3.23%, Adani Ports &Special down by 2.09%, Axis Bank down by 1.87%, GAIL India down by 1.53% and Tata Motors down by 1.38% were the top losers.

Asian markets were trading in green, FTSE Bursa Malaysia KLCI was up by 0.21%, KOSPI Index up by 1.6%, Jakarta Composite up by 2.28%, Taiwan Weighted up by 1.71%, Nikkei 225 up by 1.34%, Hang Seng up by 1.75% and Shanghai Composite was up by 0.32%.

European markets were trading mostly in red; France’s CAC was down by 0.09% and Germany’s DAX was down by 0.1%. On the other hand, UK’s FTSE 100 was up by 0.57%.