Markets pickup pace after making a flat opening

After witnessing a sharp rise in previous session, Indian equity benchmarks made a flat opening, but have picked up pace and are trading in fine fettle in early deals, with the Sensex adding over 90 points and Nifty surging above the 7,700 level, on sustained buying by funds and retail investors. The sentiment got a boost with Fitch Ratings’ statement that it expects India to be on the top of the global growth ladder and expanding by 7.7 per cent in the current fiscal, a shade higher than the estimated 7.5 per cent in the previous year due to higher disposable income and a likelihood of a normal monsoon.  Further, support also came in on report that foreign portfolio investors (FPIs) bought shares worth a net Rs 107.23 crore on April 11, 2016, as per provisional data released by the stock exchanges. However, upside remained capped ahead of the announcement of key macro-economic data- Feb IIP and March CPI due later today. 

In the scrip specific development, TTK Prestige surged over 7 percent on the BSE after the company engaged in houseware business said it will acquire a UK-based kitchenware company Horwood Homewares for an undisclosed sum. Furthermore, Nestle India was trading higher by over 3.5 percent after a government laboratory that tested 29 samples of its popular Maggi noodles at the instance of the Supreme Court said the snack is safe for consumption.

On the global front, US markets ended marginally lower on Monday as investors girded for the start of an earnings season expected to be gloomy. Asian markets were trading mostly in green, with Japanese stocks leading regional gains on a weaker yen, while Chinese shares drifted lower on profit taking after sharp gains in the previous session.

Back home, all the sectoral indices on the BSE, barring Metal, were trading in green led by Consumer Durables, Auto, Oil & Gas, Bankex. The market breadth on BSE was positive in the ratio of 1103: 426, while 60 scrips remained unchanged.

The BSE Sensex is currently trading at 25116.12, up by 93.96 points or 0.38% after trading in a range of 24996.44 and 25121.55. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.70%, while Small cap index gained 0.79%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.95%, Auto up by 0.93%, Oil & Gas up by 0.73%, Bankex up by 0.59% and Realty up by 0.59%, while Metal down by 0.42% was the lone losing index on BSE.

The top gainers on the Sensex were Dr. Reddys Lab up by 2.07%, Hero MotoCorp up by 1.87%, Lupin up by 1.29%, Tata Motors up by 1.21% and Maruti Suzuki up by 1.13%. On the flip side, Tata Steel down by 0.95%, NTPC down by 0.85%, Adani Ports &Special down by 0.85%, Coal India down by 0.84% and Bharti Airtel down by 0.65% were the top losers.

Meanwhile, Finance Minister Arun Jaitley, taking forward the dialogue with states on fiscal management asked them to spend within the fiscal limits and adhere to fiscal discipline. he also advised them to spend on infrastructure and development activities and to use Aadhaar for transferring benefits to people. Jaitley said we have to ensure that some states depending on parameters have been given some additional fiscal space, but all of us will have to learn to live and spend within means and stick to fiscal discipline. He further said that we have seen that ever since we have shown this tendency of spending more yet sticking to fiscal discipline, this has brought immediate results in terms of interest rates and India's credibility.

Jaitley said national focus is on larger expenditure on social sector, infrastructure creation and rural areas, which have conventionally been found lacking in the past. FM speaking at second conference of state finance secretaries said that “the tendency to spend it on non- developmental activities may in the short term appear to be attractive but in longer run it doesn't reap results.”

The share of states in central taxes has seen a quantum jump after implementation of the 14th Finance Commission report that prescribed a record 10 per cent increase in their share in the Union taxes to 42 percent. Total transfers to states including grants in aid from the Centre to state are estimated to be Rs 9.47 lakh crore in FY17 as compared to Rs 8.36 lakh crore during FY16. Acceding to the recommendations by the 14th Finance Commission for the 2015-20 period, the Centre has approved a fiscal deficit target of 3% for states that have had a favourable debt-GSDP ratio and interest payments-revenue receipts ratio in the previous two years.

The CNX Nifty is currently trading at 7699.50, up by 28.10 points or 0.37% after trading in a range of 7663.35 and 7701.65. There were 35 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Tata Motors - DVR up by 2.39%, BPCL up by 2.00%, Dr. Reddys Lab up by 1.97%, Hero MotoCorp up by 1.95% and Tata Power up by 1.85%. On the flip side, Coal India down by 1.27%, Tata Steel down by 1.13%, NTPC down by 0.78%, ITC down by 0.70% and Adani Ports &Special down by 0.68% were the top losers.

Asian markets were trading mostly in green, KOSPI Index increased 6.54 points or 0.33% to 1,976.91, Jakarta Composite increased 21.76 points or 0.45% to 4,808.74, Hang Seng increased 51.45 points or 0.25% to 20,492.26 and Nikkei 225 increased 186.67 points or 1.19% to 15,937.80.

On the flip side, Shanghai Composite decreased 20.21 points or 0.67% to 3,013.75, Taiwan Weighted decreased 11.36 points or 0.13% to 8,551.23 and FTSE Bursa Malaysia KLCI decreased 1.33 points or 0.08% to 1,713.95.