Benchmarks continue firm trade in late morning session

Indian equity benchmarks continued to trade firm in late morning session on account of buying in front line blue-chip stocks and taking cues from global counterparts.  Besides, covering-up of short positions in view of an approaching January expiry in the derivatives segment on Thursday, also supported the upside. Sentiments got a boost with United Nations world economy report, which indicates that India will be the world's fastest growing large economy at 7.3 percent in 2016, improving further to 7.5 percent in the following year. Some support also came with the report that India's index of industrial production (IIP) is likely to grow 4-5 per cent in December 2015. The government's efforts to de-bottleneck investment coupled with early signs of pick-up in urban demand would support production. However, gains remained capped with global rating agency Moody's statement that that India's economic exposure to external risks has gone up during the past seven months. The market participants are increasingly concerned about the potential spillover on India's growth story of external risks such as interest rate tightening in the US and China's ongoing slowdown.

On the global front, Asian markets moved further away from four-year lows struck last week, as a cold spell in parts of the northern hemisphere pushed oil prices higher and relieved some of the bearish pressure on global markets. World equities also took heart from the European Central Bank last week signalling additional monetary easing steps to come, raising hopes that other central banks would take the same path. Further, US stocks ended higher on Friday with the Nasdaq and S&P 500 gaining over two percent each, also supported the Sentiment. Back home, all BSE sectoral indices were trading in the green. Among them, Consumer Durables index gained 1.61 per cent, followed by Metal 1.37 per cent, Realty 1.08 per cent and IT 0.81 per cent. Among other shares, Commodity based stocks are gaining across the bourses after the commodity prices saw a rebound. In scrip specific development, shares of Force Motors have rallied after the company reported nearly three-fold jump in net profit at Rs 27.44 crore for the third quarter ended December 2015. Furthermore, SpiceJet has surged after the company reported net profit at Rs 238 crore for the quarter ended December 2015 (Q3FY16) against a loss of Rs 275 crore in the year ago quarter. 

The market breadth on BSE was positive, out of 2221 stocks traded, 1720 stocks advanced, while 404 stocks declined on the BSE. 

The BSE Sensex is currently trading at 24620.09, up by 184.43 points or 0.75% after trading in a range of 24521.59 and 24650.57. There were 23 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.09%, while Small cap index up by 1.56%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.61%, Metal up by 1.37%, Realty up by 1.08%, IT up by 0.81% and Auto up by 0.77%, while there were no losers on BSE sectoral space.

The top gainers on the Sensex were Sun Pharma up by 2.56%, Tata Steel up by 2.06%, HDFC up by 1.83%, TCS up by 1.78% and ICICI Bank up by 1.63%. On the flip side, Hero MotoCorp down by 1.68%, Axis Bank down by 1.26%, Bharti Airtel down by 0.77%, Larsen & Toubro down by 0.68% and Wipro down by 0.40% were the top losers.

Meanwhile, in a morale boost up for the country, United Nations in its report named World Economic Situation and Prospects 2016 has said that India which accounts for over 70 per cent of South Asia's GDP will be the world's fastest growing large economy at 7.3 per cent in 2016, improving further to 7.5 per cent in the following year, slightly up from an estimated 7.2 per cent in 2015. The report also said that South Asia is expected to be the world's fastest-growing region in 2016 and 2017.

The report which is produced annually by the UN Department of Economic and Social Affairs (UN/DESA), the UN Conference on Trade and Development (UNCTAD), the five UN regional commissions and the World Tourism Organisation, highlighting the positive sides, stated that compared to other countries of the region, the macroeconomic environment in India has improved, due to sharp decline in the prices of oil, metals and food. Further it said that although India's government is facing difficulties in implementing its wide-ranging reform agenda and some economic indicators, such as industrial production remain volatile, the consumer and investor confidence has risen.

Underscoring the need to implement fiscal reforms that boost the government revenues, the report said that despite some recent progress, fiscal positions remain generally weak owing to the small tax base, poor tax administration and the large expenditures required for closing the infrastructure and energy gaps and maintaining internal security.

Furthermore, UN report sees majority of the countries in South Asia to see accelerated growth over the next two years on the back of strong private consumption as the main driver of growth, offsetting relatively tight fiscal policies and sluggish exports.  Highlighting the challenges for South Asia, the UN report said countries like India, Bangladesh, Iran and Nepal have narrowed their fiscal deficits in 2015, however, weaknesses are there.

The CNX Nifty is currently trading at 7476.05, up by 53.60 points or 0.72% after trading in a range of 7447.85 and 7487.15. There were 40 stocks advancing against 10 stocks declining on the index.

The top gainers on Nifty were Cairn India up by 3.28%, Ambuja Cement up by 3.03%, Sun Pharma up by 2.75%, Vedanta up by 2.63% and Zee Entertainment up by 2.10%. On the flip side, Hero MotoCorp down by 1.86%, Axis Bank down by 1.24%, BPCL down by 1.08%, Larsen & Toubro down by 0.77% and Bharti Airtel down by 0.67% were the top losers.

Asian markets were trading in green; KOSPI Index was up by 0.96%, Shanghai Composite up by 1.02%, Jakarta Composite up by 1.16%, Taiwan Weighted up by 1.82%, Nikkei 225 up by 1.07% and Hang Seng up by 1.93%.