Markets trade in green; Sensex reclaims 25,000 level

Indian equity benchmarks have made a positive start and trading in fine fettle with Nifty rising over 28 points and Sensex moving above its psychological level of 25,000 in morning deals on Monday,  after posting around one percent gains last week. Sentiment remained upbeat on report that foreign portfolio investors (FPIs) bought shares worth a net Rs 1712.62 crore on Friday, as per provisional data released by the stock exchanges. Positive trade in Indian rupee also kept supporting the sentiment. The rupee continued its winning streak for the fourth session by rising 4 paise to 66.46 against the US dollar on Monday, despite mixed cues from Asian currency markets. Besides, Finance Minister Arun Jaitley said that to make economy more efficient rather than sluggish, the country has to move towards lower interest rates in both deposit and lending rates. However, markets is likely to turn choppy in the truncated trading week, as the stock exchanges BSE and NSE will remain shut on Thursday and Friday due to Holi and Good Friday, respectively.

In the scrip specific development, Ricoh India has dropped nearly 6 percent on the BSE after the exchange announced that it will shift the stock from ‘B’ group to ‘Z’ group with effect from March 28, 2016.

On the global front, the US markets ended higher on Friday completing their fifth straight positive week, as the major indices continued to rebound from a historic downturn at the start of the year. Asian markets were trading mostly in red on Monday after three consecutive weeks of gains as a retreat in oil prices made investors cautious. Taiwan stocks dropped on account of profit-taking and weakness in overseas markets, ahead of key exports data.  The Japanese market is closed for a holiday.

Back home, all the sectoral indices on the BSE were trading in green led by Consumer Durables, Oil & Gas, FMCG, Bankex and PSU.  The market breadth on BSE was positive in the ratio of 1065: 565 while 96 scrips remained unchanged.

The BSE Sensex is currently trading at 25054.65, up by 101.91 points or 0.41% after trading in a range of 24988.27 and 25098.19. There were 20 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.41%, while Small cap index gained 0.59%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.20%, Oil & Gas up by 0.93%, FMCG up by 0.86%, Bankex up by 0.65% and PSU up by 0.62%, while there were no losers. 

The top gainers on the Sensex were SBI up by 1.44%, ITC up by 1.23%, Sun Pharma Inds. up by 1.23%, Hindustan Unilever up by 1.20% and HDFC up by 1.13%. On the flip side, Lupin down by 1.74%, Asian Paints down by 1.38%, BHEL down by 1.28%, Dr. Reddys Lab down by 1.28% and Adani Ports &Special down by 1.16% were the top losers.

Meanwhile, after the government slashed interest rates on small-savings schemes, including the Public Provident Fund (PPF) and Kisan Vikas Patra (KVP), in order to align these administered interest rates closer to the market rates, Finance Minister Arun Jaitley has justified the decision and said that the country has to move towards lower interest rates. He articulated that cut on PPF rates was a right decision by the government and part of routine procedure. It will help to link small savings schemes’ interest rates with the market, as happens the world over.

Jaitley further said that “There is an old formula which has been running since ages. It states that the government gives subsidies on interest rates, set by the market, on the government securities for small savings. The interest rate on government schemes is determined by the market. This is a market aligned interest rate in which a spread is given from the government budget.'

He added that in between the interest rates went high due to which the government debt also increased. Now, the interest rates have come down. The present economic condition in the country doesn't allow the lending rates of the banks to go down whereas the deposit rates go high.

Earlier, the government decided to cut the interest rates on various small savings schemes. As per the alignment, PPF rate has been cut to 8.1 per cent from 8.7 per cent, rate on the KVP has been cut to 7.8 per cent from 8.7 per cent, the five-year National Savings Certificates will earn interest at the rate of 8.1 per cent as against 8.5 per, five-year Monthly Income Account rate has been cut to7.8 per cent as opposed to 8.4 per cent now. The girl-child saving scheme, Sukanya Samriddhi Account, will have an interest rate of 8.6 per cent as against 9.2 per cent, while the senior citizen savings scheme of five years will earn 8.6 per cent compared with 9.3 per cent. The new rates will come into effect on April 1 and will be valid till June 30, after the decision taken last month to revise the interest rates on small savings every quarter.

The CNX Nifty is currently trading at 7633.35, up by 29.00 points or 0.38% after trading in a range of 7617.70 and 7642.85. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Ultratech Cement up by 2.52%, Vedanta up by 2.38%, PNB up by 2.19%, ACC up by 2.08% and BPCL up by 2.05%. On the flip side, Lupin down by 1.51%, Asian Paints down by 1.47%, Adani Ports &Special down by 1.43%, BHEL down by 1.32% and Dr. Reddys Lab down by 1.30% were the top losers.

Asian markets were trading mostly in red, Taiwan Weighted decreased 28.33 points or 0.32% to 8,782.38, FTSE Bursa Malaysia KLCI decreased 7.81 points or 0.46% to 1,708.53, KOSPI Index decreased 6.07 points or 0.3% to 1,986.05 and Jakarta Composite decreased 2.72 points or 0.06% to 4,882.99.

On the flip side, Shanghai Composite increased 52.89 points or 1.79% to 3,008.04, Hang Seng increased 54.09 points or 0.26% to 20,725.72.