Benchmarks trim gains; trade continues in green

Local equity markets, after paring some gains in early deals, have gained some momentum on account of buying in frontline blue chip stocks. Sentiment got some support with the report that a committee of top officials including from commerce and shipping ministries will meet on Tuesday to discuss ways to fast-track clearance processes and improve ease of doing business to boost shipments. Furthermore, Foreign Investment Promotion Board (FIPB) in its 232nd meeting chaired by Economic Affairs Secretary Shaktikanta Das has given approval for 16 Foreign Direct Investment (FDI) proposals out of the 34 on agenda amounting Rs 14,000 crore. Some support also came in from reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 672 crore on March 04, 2016. However, gains remained capped with the MNI Consumer Sentiment index falling to 108.9 in February from 109.8 in January, indicating sluggish sentiment among end consumer as they grapple with volatile markets and deteriorating personal finances. Besides, weak trend in Asian stocks coupled with depreciation in rupee value have also limited the gains. Breaking its sixth-day rising streak, the Indian rupee weakened by 19 paise to quote at 67.27 against the on fresh demand for the American currency from importers and banks. Meanwhile, Metal pack has gained considering the rise in global commodity prices, while shares of oil & gas producers such as Cairn India, ONGC, Oil India, Reliance Industries and GAIL India also rose on the back of surge in prices of crude oil in the international markets.

On the global front, Asian markets trading mostly in red on Tuesday, as investors took profits after a month-long rally and market participants grew wary of the market's near-term prospects ahead of major central bank meetings. Japanese shares fell for a second day as a stronger yen cut the earnings outlook for exporters while China stocks slumped after the released data showing another hefty slump in exports and Brent oil retreated from near 2016 highs. Back home, stocks from Realty, PSU and Oil & Gas counters were supporting the markets’ uptrend, while those from Banking counter was adding to the underlying cautious undertone. In scrip specific development, Shares of Strides Shasun have surged after the company’s subsidiary plans to acquire three brands from Sweden-based Moberg Pharma. Furthermore, Ajanta Pharma rallied after the company received final approval of Almotriptan Malate tablets in dosages of 6.25mg and 12.5mg.

The market breadth on BSE was positive, out of 2192 stocks traded, 1314 stocks advanced, while 755 stocks declined on the BSE.

The BSE Sensex is currently trading at 24724.83, up by 78.35 points or 0.32% after trading in a range of 24629.23 and 24793.62. 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 0.35%, while Small cap index up by 0.80%.

The top gaining sectoral indices on the BSE were Metal up by 2.32%, Oil & Gas up by 1.79%, Realty up by 0.92%, FMCG up by 0.76% and Auto up by 0.69%, while IT down by 0.77%, Bankex down by 0.65% and TECK down by 0.59% were the top losing indices on BSE.

The top gainers on the Sensex were GAIL India up by 2.59%, Adani Ports &Special up by 2.57%, Tata Motors up by 2.11%, Lupin up by 2.09% and Tata Steel up by 1.86%. On the flip side, SBI down by 1.96%, Hindustan Unilever down by 1.90%, ICICI Bank down by 1.66%, TCS down by 1.02% and Infosys down by 0.87% were the top losers.

Meanwhile, in order to check black money from entering in the country, the Reserve Bank of India (RBI) will be sharing Foreign Direct Investment (FDI) related information with the country’s intelligence agencies-Intelligence Bureau (IB) and the Research and Analysis Wing (RAW). This move comes after the Cabinet Secretariat under whose administrative control RAW functions had expressed its concern over companies in tax havens investing in the country.  Highlighting the need to keep a track of such companies' source of funding, the Cabinet Secretariat suggested that Central Economic Intelligence Bureau (CEIB) under the Finance Ministry should maintain a database of such entities and investments, a move which was later rejected.

This move assumes importance as the government expects rise in FDI inflow to the country owing to its attempts to liberalise trade and promote ease of doing business. The decision was taken during a recent meeting of a government group, headed by Revenue Secretary, to check economic crimes.  During the meeting of 'Working Group on Intelligence Apparatus', representatives of Intelligence Bureau felt that it is important to have the information. It was decided that RBI should share information on FDI which actually enters the country with IB and Cabinet Secretariat.

The FDI comes either through automatic route or through Foreign Investment Promotion Board (FIPB), an inter-ministerial body under the Department of Economic Affairs, which is responsible for processing of FDI proposals and making recommendations for government approval.

According to data of Department of Industrial Policy and Promotion (DIPP), India has received $29.44 billion foreign direct investment (FDI), surging by 40 percent during April-December in the current fiscal.

The CNX Nifty is currently trading at 7509.70, up by 24.35 points or 0.33% after trading in a range of 7482.65 and 7527.15. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were Cairn India up by 7.34%, Vedanta up by 4.58%, Hindalco up by 4.16%, Adani Ports &Special up by 2.69% and GAIL India up by 2.35%. On the flip side, Bank of Baroda down by 2.52%, PNB down by 2.17%, Hindustan Unilever down by 1.97%, SBI down by 1.70% and ICICI Bank down by 1.43% were the top losers.

Asian markets were trading in red, Nikkei 225 was down by 0.42%, Hang Seng down by 0.91%, Shanghai Composite down by 1.62%, Taiwan Weighted down by 0.24%, KOSPI Index down by 0.72%, Jakarta Composite down by 0.38% and FTSE Bursa Malaysia KLCI was down by 0.32%.