Benchmarks continue firm trade in late afternoon session

Indian equity benchmarks continued their firm trade in the late afternoon session on account of buying in frontline blue chip counters. The sentiments were on firm note with Economic Affairs Secretary Shaktikanta Das statements that the country’s GDP growth is likely to touch 8% in the current fiscal 2016-17, on the back of above normal monsoon. Investors shrugged off Reserve Bank of India’s (RBI) Governor Raghuram Rajan’s decision of not going for a second term and bow out in September. Global markets were reacting positively as some fears that Britain would vote to leave the European Union abated, boosting a recovery in both sterling and investors taste for risk assets. Three British opinion polls ahead of the EU membership referendum on June 23 showed the ‘Remain’ camp recovering some momentum, although the overall picture remained one of an evenly split electorate. Traders were seen piling position in IT, TECK and Realty sector stocks. In scrip specific development, hectic buying activity was witnessed in aviation stock like Jet airways, SpiceJet and InterGlobe Aviation after the government approved 100% FDI in scheduled airlines. Reliance Defence & Engineering, Astra Microwave Products, Walchandnagar Industries and Bharat Forge was trading firm after government approved 100% FDI in defence sector. Gammon India was locked at upper circuit after the company reported net profit of Rs 53.38 crore in the quarter ended March 31, 2016 compared with net loss of Rs 73.53 crore in the quarter ended March 31, 2015.

On the global front, the Asian markets were trading in green while the European markets were trading on optimistic note. Back home, the NSE Nifty and BSE Sensex were trading above the psychological 8,200 and 26,700 levels respectively. The market breadth on BSE was positive in the ratio of 1291:1116 while 188 scrips remained unchanged.

The BSE Sensex is currently trading at 26798.12, up by 172.21 points or 0.65% after trading in a range of 26447.88 and 26830.48. 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 0.29%, while Small cap index up by 0.33%.

The gaining sectoral indices on the BSE were IT up by 1.84%, TECK up by 1.74%, Realty up by 1.58%, Capital Goods up by 0.99% and Consumer Durables up by 0.89%

The top gainers on the Sensex were Tata Steel up by 2.61%, Infosys up by 2.18%, Bharti Airtel up by 1.98%, TCS up by 1.90% and ONGC up by 1.76%.

On the flip side, Axis Bank down by 1.09%, HDFC down by 0.72%, Asian Paints down by 0.58%, Coal India down by 0.45% and ICICI Bank down by 0.27% were the top losers.

Meanwhile, following NITI Aayog’s sectoral presentations to Prime Minister Narendra Modi last Month, which highlighted sluggishness in many infrastructure areas, Narendra Modi has set targets for infrastructure sectors and the same has been communicated to ministries of railways, roads, ports, civil aviation and others, with detailed timelines. Modi has set targets with an aim to step up infrastructure investment and speed up execution and said that the targets are to be delivered by end of the financial year to effect visible change on ground.

Prime Minister has identified 26 action points under 12 heads for roads and 36 action points for railways under about a dozen heads that need quick action by ministries to implement them in a time-bound manner.  These will now be regularly monitored by NITI Aayog and reviewed by the Prime Minister himself on a quarterly basis.

Under the targets set, the Indian Railways has been asked to increase the total lines commissioned from 7-8 km per day to 10 km per day by financial year 2016-17 and 15 km per day by financial year 2018-19. Modi has asked the ministry of road transport and highways to finalise highway network expansion and operations plan for next three years by September this year, while accelerating the rate of construction of roads in the North-East by six months to November 2016. Modi has also asked the ministries for roads and finance to speed up finalisation of PPP renegotiation framework and public contracts bill by September 2016.

Similar targets have been set for others as well, such as the number of villages that have to be electrified where the deadlines range from three months to up to three years for different key actions. Further, some big-ticket interventions including raising long-term funding for road projects, developing a contractor rating system that would incentivise early project completion, bringing about organisational reforms in Indian Railways, improvement in governance structure by setting up an independent regulator to correct tariff imbalance in railways.

The CNX Nifty is currently trading at 8220.35, up by 50.15 points or 0.61% after trading in a range of 8107.35 and 8229.90. There were 37 stocks advancing against 14 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 2.63%, HCL Tech up by 2.46%, TCS up by 2.09%, Infosys up by 2.06% and Ultratech Cement up by 1.87%.

On the flip side, Axis Bank down by 1.23%, Asian Paints down by 0.82%, HDFC down by 0.66%, Eicher Motors down by 0.66% and ICICI Bank down by 0.40% were the top losers.

The Asian markets were trading in green; Shanghai Composite increased 3.7 points or 0.13% to 2,888.81, FTSE Bursa Malaysia KLCI increased 7.28 points or 0.45% to 1,631.46, Jakarta Composite increased 15.05 points or 0.31% to 4,850.19, KOSPI Index increased 27.72 points or 1.42% to 1,981.12, Taiwan Weighted increased 57.84 points or 0.68% to 8,625.92, Hang Seng increased 340.22 points or 1.69% to 20,510.20 and Nikkei 225 increased 365.64 points or 2.34% to 15,965.30.

The European markets were trading in green; UK’s FTSE 100 increased 127.69 points or 2.12% to 6,148.78, France’s CAC increased 111.99 points or 2.67% to 4,305.82 and Germany’s DAX increased 273.97 points or 2.84% to 9,905.33.