Benchmarks continue to trade in green in late morning session

Bouncing back from day's low, benchmark equity indices were trading firmly in green, with gains of over quarter of a percent, which took Sensex above the psychological 23,750 level and Nifty above the crucial 7,200 mark. Sentiments got a boost with the Finance Ministry’s statement that the quality of government expenditure has improved significantly in the current fiscal and is resulting in high growth. According to CGA data, it was 74.4 per cent of Budget Estimate at the end of December, as compared to 61.3 per cent a year ago.  Furthermore, some support also came in after the global rating agency Moody’s pegged India’s growth at 7.5% for next two years, saying that it’s insulated from global turmoil. Meanwhile, the Organisation for Economic Cooperation and Development (OECD) too has raised India’s growth forecast compared to 7.3 percent expansion projected in November 2015. OECD said that Indian economy will continue to see robust growth at 7.4 percent in the next financial year even as only modest recovery is expected in advanced economies. However, investors remained cautious with the report that overseas investors have pulled out a massive Rs 4,600 crore from the Indian capital markets this month so far, primarily on account of continuous fall in crude oil prices and fears of a global slowdown. Besides, Indian rupee weakened by 23 paise to trade at fresh 30 month low at 68.69 against the American currency in early trade as the dollar firmed up overseas, also weighed on the sentiment.  Meanwhile, all eyes would be on the Budget session of Parliament that will be commenced on February 23 and will focus largely on the financial business of the government. The Rail Budget will be unveiled on Thursday, economic survey on Friday and the Union Budget next Monday.

On the global front, Asian markets were trading firm with Chinese shares gaining the most as Investors are hoping this week's meeting of finance ministers from the Group of 20 major rich and developing economies will spur moves to shore up global growth. Meanwhile, Wall Street ended flat on Friday, with the Dow Jones index falling 0.13 per cent to settle the week at 16,391. Nonetheless, US stocks logged their best weekly gains this year.

Back home, stocks from Realty, Oil & Gas and PSU counters were supporting the markets’ uptrend, while those from Consumer Durables, IT and FMCG counters were adding to the underlying cautious undertone. Rail stocks came into the limelight after the report that the government is seeking to step up its drive to modernise the railways by increasing investment in creating new capacity and assets by 20-30 per cent in the rail budget.  In scrip specific development, Shares of Inox Wind have surged after the company said it has commissioned common power evacuation systems at its Lahori site in Madhya Pradesh. On the other hand, shares of Maruti Suzuki have declined after the company temporarily suspended production at its Gurgaon and Manesar plants on account of the ongoing agitation in Rohtak and nearby areas with supplies of certain components being disrupted. The market breadth on BSE was positive, out of 2195 stocks traded, 1289 stocks advanced, while 787 stocks declined on the BSE. 

The BSE Sensex is currently trading at 23795.05, up by 85.90 points or 0.36% after trading in a range of 23674.86 and 23817.32. There were 21 stocks advancing against 9 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.69%, while Small cap index up by 0.61%.

The top gaining sectoral indices on the BSE were Realty up by 1.00%, Oil & Gas up by 0.97%, PSU up by 0.67%, Capital Goods up by 0.58% and Metal up by 0.54%, while Consumer Durables down by 0.22%, IT down by 0.07% and FMCG down by 0.06% were the top losing indices on BSE.

The top gainers on the Sensex were Hindustan Unilever up by 3.13%, Bharti Airtel up by 1.96%, Sun Pharma up by 1.79%, Reliance Industries up by 1.74% and Lupin up by 1.57%. On the flip side, ITC down by 2.18%, Maruti Suzuki down by 1.71%, Wipro down by 1.25%, Adani Ports &Special down by 1.01% and GAIL India down by 0.77% were the top losers.

Meanwhile, despite the Finance Minister Arun Jaitley admitting that meeting the Rs 69,500 crore disinvestment target for the fiscal year will be difficult, amid global volatility in equity and currency markets which derailed the highly ambitious PSU stake sale in the current fiscal, the government will go ahead with prudent and timely disinvestments, target for which it has said that it should not be just confined to dates. Volatile market conditions have affected the government's disinvestment plan, which mostly have commodity and oil stocks in the pipeline.

DoD Secretary Neeraj Gupta has said that the government should operate in an environment which cannot be predicted and managed to achieve the target as in present day scenario there are more pressing global issues than the domestic conditions. He further added that the government is committed to pursue the minority stake sale and disinvestment process will continue at the right environment by taking the advantage of the right opportunity.

So far this fiscal, the Department of Disinvestment (DoD) has been able to raise over Rs 13,300 crore by selling stake in five PSUs which include Rural Electrification Corp with Rs 1,608 crore, Power Finance Corp Rs 1,671 crore, Dredging Corp of India Rs 53.33 crore, Indian Oil Corp Rs 9,369 crore and Engineers India Rs 640 crore.  With this, the government is likely to miss its disinvestment target for the sixth year in a row, though the disinvestment department had lined up about two dozen PSUs for stake sale and putting in place Cabinet approvals for launching the stake sale since the beginning of the year.

The CNX Nifty is currently trading at 7233.00, up by 22.25 points or 0.31% after trading in a range of 7200.70 and 7243.05. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Bosch up by 3.91%, Hindustan Unilever up by 3.18%, Zee Entertainment up by 2.19%, Bharti Airtel up by 2.07% and Idea Cellular up by 1.80%. On the flip side, Tech Mahindra down by 2.38%, ITC down by 2.07%, Maruti Suzuki down by 1.65%, Wipro down by 1.31% and Adani Ports &Special down by 1.19% were the top losers.

Asian markets were trading mostly in green, FTSE Bursa Malaysia KLCI was up by 0.2%, Shanghai Composite up by 2.01%, Nikkei 225 up by 1.12% and Hang Seng was up by 0.77%. On the flip side, Taiwan Weighted was down by 0.1%, KOSPI Index down by 0.15% and Jakarta Composite was down by 0.09%.