Benchmarks trade firm; Oil & Gas, TECK lead

Indian equity benchmarks continued its firm trade in the late afternoon session on account of buying in frontline blue chip counters. Investors however maintained cautious approach ahead of US and Japanese central bank policy decisions, while crude oil prices hovered near 2016 highs. Traders were seen piling positions in Oil & Gas, TECK and FMCG sector stocks while selling was witnessed in Bankex, Power and Capital Goods sector stocks. In scrip specific development, Raymond was trading firm after the company reported over two fold jump in consolidated net profit at Rs 56.22 crore for the fourth quarter ended March 31, on account of revenue growth and profitability from lifestyle business. Axis Bank was trading under pressure after the bank stated that it has prepared a ‘watch list’ of about Rs 22,000 crore worth of loans, or 4% of its total assets, out of which 60% might go bad in the next couple of quarters. The market may remain volatile this week as traders may roll over positions in the Futures & Options (F&O) segment from the near month i.e. April 2016 series to next month i.e. May 2016 series. The near month April 2016 derivatives contracts will expire on Thursday i.e. April 28, 2016.

On the global front, the Asian markets were trading mostly in red while the European markets traded on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 7,950 and 26,000 levels respectively. The market breadth on BSE was positive in the ratio of 1236:1194 while 169 scrips remained unchanged.

The BSE Sensex is currently trading at 26039.00, up by 31.70 points or 0.12% after trading in a range of 25885.24 and 26092.93. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.25%, while Small cap index up by 0.39%.

The gaining sectoral indices on the BSE were Oil & Gas up by 1.26%, TECK up by 0.67%, FMCG up by 0.62%, PSU up by 0.56%, Consumer Durables up by 0.48% while, Bankex down by 0.68%, Power down by 0.43%, Capital Goods down by 0.20%, Realty down by 0.15% were the losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 3.84%, Adani Ports & Special Economic Zone up by 3.67%, ONGC up by 3.34%, GAIL India up by 1.77% and Mahindra & Mahindra up by 1.47%.

On the flip side, Axis Bank down by 2.79%, ICICI Bank down by 2.64%, SBI down by 1.42%, HDFC down by 1.05% and Lupin down by 0.68% were the top losers.

Meanwhile, rating agency Moody’s Investors Service has said that implementation of the Goods and Services Tax (GST) and bridging large infrastructure deficit are a difficult task before the Indian government. However, Moody’s is positive that easing of constraints on investment coupled with RBI’s inflation targeting and ongoing efforts to clean up bank balance sheets could propel growth.

Moody’s Investors Service  in its report stated that “Our positive outlook on India’s rating is based on our expectation of continued but gradual policy efforts to reduce the sovereign risks posed by high fiscal deficits, volatile inflation and weak bank balance sheets”. Moody’s Investors Service has further said that a history of double-digit inflation, elevated government debt, weak infrastructure and a complex regulatory regime have constrained India’s credit profile.

Indirect tax reform GST is currently stuck in the Rajya Sabha where the ruling NDA does not enjoy a majority. A single rate GST will replace central excise, state VAT, entertainment tax, octroi, entry tax, luxury tax and purchase tax on goods and services to ensure seamless transfer of goods and services.

Besides, the government is working on steps to modernise India’s infrastructure and is looking for avenues to fund development. It has set up a maiden sovereign wealth fund, NIIF, and is scouting for investors to buy 51 per cent stake in it. The government holds 49 per cent in NIIF.

The CNX Nifty is currently trading at 7975.35, up by 12.70 points or 0.16% after trading in a range of 7940.55 and 7991.00. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Bharti Airtel up by 3.84%, Adani Ports & Special Economic Zone up by 3.64%, ONGC up by 3.45%, Bharti Infratel up by 3.28% and GAIL India up by 2.01%.

On the flip side, ICICI Bank down by 2.64%, Axis Bank down by 2.56%, Ultratech Cement down by 1.83%, Tata Power down by 1.67% and SBI down by 1.52% were the top losers.

The Asian markets were trading mostly in red; Nikkei 225 decreased 62.79 points or 0.36% to 17,290.49, Hang Seng decreased 45.67 points or 0.21% to 21,361.60, Taiwan Weighted decreased 18.52 points or 0.22% to 8,563.05, Shanghai Composite decreased 11.03 points or 0.37% to 2,953.67, FTSE Bursa Malaysia KLCI decreased 6.38 points or 0.38% to 1,686.12 and KOSPI Index decreased 4.23 points or 0.21% to 2,015.40.

On the other hand, Jakarta Composite increased 20.1 points or 0.42% to 4,834.20.

The European markets were trading in red; UK’s FTSE 100 decreased 15.12 points or 0.24% to 6,269.40, Germany’s DAX decreased 24.83 points or 0.24% to 10,234.76 and France’s CAC decreased 1.23 points or 0.03% to 4,531.95.