Benchmarks hover around neutral line in late afternoon session

Indian equity benchmarks trimmed its gains and are hovering near the neutral line in the late afternoon session on account of selling in front line blue chip counters. Investors maintained cautious approach and are awaiting the outcome of the US Fed meet which ends later today. Standard & Poor’s Rating Services stated that Indian economy is less vulnerable to external shocks as it is mainly driven by household consumption and government spending, and not dependent on hot money which can move out quickly, arrested the selling pressure. Traders were seen piling position in Power, Realty and PSU stocks while selling was witnessed in Capital Goods, Bankex and Metal sector stocks. In scrip specific development, Vardhman Textiles was trading firm after the company reported a strong 66% year on year growth in consolidated net profit at Rs 161 crore for the third quarter ended December 31, 2015 due to lower raw material cost. The market may remain volatile as traders may roll over positions in the Futures & Options (F&O) segment from the near month i.e. January 2016 series to next month i.e. February 2016 series. The near month January 2016 derivatives contracts will expire on Thursday i.e. January 28, 2016.

On the global front, the Asian markets were trading mostly in green while the European markets were trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 7,400 and 24,400 levels respectively. The market breadth on BSE was positive in the ratio of 1316:1093 while 169 scrips remained unchanged.

The BSE Sensex is currently trading at 24494.07, up by 8.12 points or 0.03% after trading in a range of 24460.92 and 24645.70. There were 16 stocks advancing against 13 stocks declining on the index while 1 stock remained unchanged.

The broader indices were trading in green; the BSE Mid cap index was up by 0.34%, while Small cap index up by 0.43%.

The gaining sectoral indices on the BSE were Power up by 1.32%, Realty up by 0.91%, PSU up by 0.75%, TECK up by 0.32%, Oil & Gas up by 0.21% while Capital Goods down by 0.77%, Bankex down by 0.13%, Metal down by 0.05%, Consumer Durables down by 0.00% were the losing indices on BSE.

The top gainers on the Sensex were NTPC up by 3.38%, Dr. Reddy’s Lab up by 1.56%, Tata Motors up by 1.14%, Tata Steel up by 1.08% and SBI up by 0.85%.

On the flip side, BHEL down by 3.37%, Asian Paints down by 2.13%, Hindustan Unilever down by 1.57%, Hero MotoCorp down by 1.43% and Axis Bank down by 1.37% were the top losers.

Meanwhile, with an aim to boost manufacturing further, the government is planning to create coastal economic zones along the country's 7,500-km long coastline covering many states, ports and special economic zones having uniform policy. The idea is, however, at the conceptual stage. After firming up the proposal, the ambitious plan could be announced by the Prime Minister himself like in the case of 'Make in India'. In the present scenario, these coastal economic zones could come up in Maharashtra, Gujarat, Tamil Nadu and Andhra Pradesh.

Though, there are special economic zones where investors can set up their manufacturing base and get incentives like tax exemption, speedy regulatory clearance, round the clock power and security. The government wants to create coastal economic zones where investor will be provided host of incentives and facilities uniformly across many town, cities, ports and states.

These coastal economic zones would attract investment as well as workforce in order to create facilities to manufacture not only for domestic production but for exports in large quantities. The government thinks that there should be a port-led development as was done in China where cities were granted special status of open coastal cities which enjoyed special policies of the government. Though India has many ports, there is no cluster or a section of coastline that enjoys special status and incentives.

The CNX Nifty is currently trading at 7434.75, down by 1.40 points or 0.02% after trading in a range of 7419.70 and 7477.90. There were 27 stocks advancing against 23 stocks declining on the index while 1 stock remained unchanged.

The top gainers on Nifty were NTPC up by 3.33%, Power Grid up by 3.31%, Idea Cellular up by 2.34%, PNB up by 1.63% and Dr. Reddy’s Lab up by 1.52%.

On the flip side, BHEL down by 3.24%, Asian Paints down by 2.30%, Ambuja Cement down by 2.21%, Hindustan Unilever down by 1.77% and Axis Bank down by 1.62% were the top losers.

The Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI increased 4.86 points or 0.3% to 1,631.52, Taiwan Weighted increased 21.16 points or 0.27% to 7,849.83, KOSPI Index increased 26.18 points or 1.4% to 1,897.87, Jakarta Composite increased 57.31 points or 1.27% to 4,567.78, Hang Seng increased 191.65 points or 1.02% to 19,052.45 and Nikkei 225 increased 455.02 points or 2.72% to 17,163.92.

On the other hand, Shanghai Composite decreased 14.23 points or 0.52% to 2,735.56.

The European markets were trading in red; UK’s FTSE 100 decreased 22.52 points or 0.38% to 5,888.94, Germany’s DAX decreased 37.03 points or 0.38% to 9,785.72 and France’s CAC decreased 9.18 points or 0.21% to 4,347.63.