Benchmarks continue dull trade in late morning session

Indian equity benchmarks continued their flat trade in green in late morning session in absence of any upside triggers. The sentiments got some support as rupee continued to rule firm against the dollar on sustained selling of the American currency by banks and exporters amid strong recovery in domestic equities. Expectations of more foreign capital inflows in view of robust domestic equities boosted the value of the rupee against the dollar. Investors however maintained cautious stance with the World Bank slashing global growth outlook for 2016 to 2.4% from 2.9%, citing sluggishly low commodity prices, uncertain capital flow and lukewarm demand in advanced economies.  Traders were seen piling position in Capital Goods, Power and Auto stocks while selling was witnessed in IT, TECK and Bankex sector stocks. In scrip specific development, shares of companies engaged in defence related sector such as Reliance Defence and Engineering, Bharat Electronics, Walchandnagar Industries, Astra Microwave Products and Nelco were trading firm in anticipation of good orders inflow after the United States (US) recognized India as a major defence partner, which means that for defence related trade and technology transfer the country would now be treated at par with America’s closest allies.

On the global front, the Asian markets were trading mostly in red. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,250 and 27,000 levels respectively. The market breadth on BSE was positive in the ratio of 1299:705 while 110 scrips remained unchanged.

The BSE Sensex is currently trading at 27049.29, up by 39.62 points or 0.15% after trading in a range of 27011.04 and 27105.41. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.37%, while Small cap index up by 0.65%.

The gaining sectoral indices on the BSE were Capital Goods up by 1.18%, Power up by 1.12%, Auto up by 0.49%, PSU up by 0.48%, Consumer Durables up by 0.35% while, IT down by 0.26%, TECK down by 0.09%, Bankex down by 0.04% were the losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 2.08%, BHEL up by 1.47%, ICICI Bank up by 1.28%, ONGC up by 1.22% and Hero MotoCorp up by 1.22%.

On the flip side, Asian Paints down by 1.24%, HDFC Bank down by 0.78%, Coal India down by 0.72%, Infosys down by 0.68% and TCS down by 0.60% were the top losers.

Meanwhile, the Empowered Committee of Secretaries is all set to meet this weekend to give final view to the recommendations that will impact the wages of lakhs of government employees, who are anxiously waiting for the implementation of the recommendation of the 7th Pay Commission.

The Empowered Committee of Secretaries led by Cabinet Secretary PK Sinha will meet on June 11 to make the final changes to the 7th Pay Commission's recommendations. The secretaries group has recommended between Rs 2,70,000 and Rs 21,000 hike for the higher and the lower level respectively. This is 20000 more in the upper limit and 3000 more in the lower level prescribed by the 7th CPC.

Earlier, the 7th pay commission had recommended around 23% rise in salaries of the central government employees. The government will have to shell out additional Rs 1 lakh crore on account of increase in salaries, allowances and pensions.

The CNX Nifty is currently trading at 8270.70, up by 4.25 points or 0.05% after trading in a range of 8261.05 and 8288.90. There were 32 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Bharti Airtel up by 2.06%, BHEL up by 1.47%, HCL Tech up by 1.27%, ICICI Bank up by 1.24% and Ambuja Cement up by 1.22%.

On the flip side, Kotak Mahindra Bank down by 1.96%, Zee Entertainment down by 1.57%, Asian Paints down by 1.29%, Yes Bank down by 1.12% and IndusInd Bank down by 1.09% were the top losers.

The Asian markets were trading mostly in red; Hang Seng decreased 57.5 points or 0.27% to 21,270.74, Jakarta Composite decreased 24.9 points or 0.5% to 4,909.09, Shanghai Composite decreased 11.85 points or 0.4% to 2,924.20 and FTSE Bursa Malaysia KLCI decreased 6.08 points or 0.37% to 1,654.54.

On the other hand, KOSPI Index increased 11.96 points or 0.59% to 2,023.59, Taiwan Weighted increased 32.48 points or 0.37% to 8,712.38 and Nikkei 225 increased 100.74 points or 0.6% to 16,776.19.