Benchmarks continue firm trade in late afternoon session

Indian equity benchmarks continued its firm trade in the late afternoon session on account of buying in frontline blue chip counters. The sentiments were on optimistic note after Moody’s Investors Service stated that Indian economy will grow at 7.5% in 2016 and 2017 as it is relatively less exposed to external headwinds, like China slowdown, and will benefit from lower commodity prices. The firm, however, warned the generally robust economic environment is constrained by banks balance sheet repair and elevated corporate debt and corporate pricing power being limited by the impact on food price inflation and households budgets of two consecutive droughts. Traders were seen piling positions in IT, TECK and Capital Goods stocks while selling was witnessed in Power, Realty and Auto sector stocks. In scrip specific development, Just Dial was trading firm after the foreign brokerage firm upgraded the stock to neutral from sell. The investment bank cited limited downside risks due to slowdown in growth. On the other hand, Monsanto India was trading under pressure after fair trade regulator CCI ordered a detailed probe against its US-parent joint venture Mahyco Monsanto Biotech India (MMBL). The regulator has ordered a detailed probe into alleged abuse of dominance by the Indian arm of the US-based genetically modified seed giant Monsanto.

On the global front, the Asian markets were trading mostly in green while the European markets were trading mostly on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 7,100 and 23,500 levels respectively. The market breadth on BSE was positive in the ratio of 1348:1029 while 147 scrips remained unchanged.

The BSE Sensex is currently trading at 23539.07, up by 157.20 points or 0.67% after trading in a range of 23510.64 and 23735.35. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.17%, while Small cap index up by 0.58%.

The gaining sectoral indices on the BSE were IT up by 1.33%, TECK up by 1.27%, Capital Goods up by 1.04%, FMCG up by 1.00%, Oil & Gas up by 0.81% while, Power down by 0.45%, Realty down by 0.13%, Auto down by 0.06% were the losing indices on BSE.

The top gainers on the Sensex were Dr. Reddy’s Lab up by 4.99%, ONGC up by 3.80%, Hero MotoCorp up by 3.33%, ICICI Bank up by 2.99% and Larsen & Toubro up by 2.03%.

On the flip side, BHEL down by 3.64%, Maruti Suzuki down by 3.01%, Tata Steel down by 2.25%, Asian Paints down by 2.15% and Axis Bank down by 2.02% were the top losers.

Meanwhile, the Ministry of Mines has finalized a draft National Mineral Exploration Policy (NMEP) which has outlined a slew of measures for accelerating mineral exploration in the country. The policy has proposed to select the private explorer through a competitive bidding process conducted through an electronic auction.  It further proposed that private entities would be engaged to carry out regional and detailed exploration work with the right to a certain share in revenue from mining operation after the electronic auction of the mineral block discovered by the private explorer.

Moreover, the draft of the NMEP proposed to allow private companies to carry out exploration of mineral bearing areas in return for a share of the royalty given to state governments. The share of revenue to the state governments will be paid by way of royalty which would be accruing. However, the decision on whether the revenue share would be paid in form of a lumpsum or annuity through the lease period of the mine has been kept open-ended.

The Mines Minister Narendra Tomar has launched the Geological Survey of India’s ‘Uncover’ project. The project will be implemented in two selected areas of the country and is focused on probing for deep seated or concealed mineral deposits. The Geological Survey of India has identified 100 blocks covering 12,000 sq km which can be given to private explorer. The blocks have prospects of various minerals, including gold, iron, tin/tungsten and other strategic minerals. The Ministry of Mines will take “further action” with regard to handing them over to private explorers.

The CNX Nifty is currently trading at 7142.40, up by 33.95 points or 0.48% after trading in a range of 7140.20 and 7215.10. There were 28 stocks advancing against 21 stocks declining on the index while 1 stock remained unchanged.

The top gainers on Nifty were Dr. Reddy’s Lab up by 4.43%, Cairn India up by 3.49%, ONGC up by 3.44%, Hindalco up by 3.04% and Hero MotoCorp up by 3.00%.

On the flip side, BHEL down by 3.97%, Maruti Suzuki down by 3.07%, Asian Paints down by 2.66%, Tata Steel down by 2.41% and Adani Ports & Special Economic Zone down by 2.35% were the top losers.

The Asian markets were trading mostly in green; Jakarta Composite increased 6.2 points or 0.13% to 4,771.70, FTSE Bursa Malaysia KLCI increased 13.25 points or 0.8% to 1,677.57, KOSPI Index increased 24.9 points or 1.32% to 1,908.84, Taiwan Weighted increased 100.42 points or 1.22% to 8,314.67, Nikkei 225 increased 360.44 points or 2.28% to 16,196.80 and Hang Seng increased 438.51 points or 2.32% to 19,363.08.

On the other hand, Shanghai Composite decreased 4.44 points or 0.16% to 2,862.89.

The European markets were trading mostly in green; France’s CAC increased 4.31 points or 0.1% to 4,237.78, Germany’s DAX increased 15.9 points or 0.17% to 9,393.11 while, UK’s FTSE 100 decreased 27.32 points or 0.45% to 6,003.00.