Benchmarks continue firm trade in late morning session

The Indian markets continue to hold their gains in the late morning trade with benchmark indices trading higher by over half a percent. The good going in the regional markets have equally supported the markets coupled with the good domestic report that Monsoon rains have covered nearly all of India except some parts of the western states of Gujarat and Rajasthan, while the remaining region is likely to be covered this week. The rainfall deficit has reduced to 6 percent, sharply down from 18 percent in the first week of June. Besides, appreciation in Indian rupee against the dollar too aided sentiments. Staying with its winning momentum for the fourth consecutive day, Indian rupee strengthened 15 paise to 67.17 against the dollar on increased selling of the US currency by banks and exporters. However, gains remained capped with RBI Governor Raghuram Rajan who warning against expecting too much from central banks, stated that it is wrong on their part also to always claim a ‘bazooka’ left up their sleeves.

On the global front, Asian shares shrugged off early losses and edged higher on Monday, while the Australian dollar was under pressure after no clear winner emerged from a weekend election. Besides, higher commodity prices lifted resources stocks. Japanese stocks rose, led by telecommunications and food companies, as the yen weakened amid growing speculation the impact from the Brexit vote will be muted as central banks step in to bolster markets.

Back home, stocks from Oil & Gas, PSU and Capital Goods counters were supporting the markets’ uptrend, while those from FMCG counters were adding to the underlying cautious undertone. In scrip specific development, shares of Tata Motors gained after the company’s total passenger and commercial vehicle sales rose 8% to 44,276 vehicles in June 2016. The company sold 40,869 vehicles in June 2015. Morover, Manappuram Finance rallied after rating agency CRISIL upgraded its rating on the long-term bank facility and non-convertible debentures, while reaffirming the rating on short-term debt of the company.

The market breadth remained optimistic as there were 1653 shares on the gaining side against 596 shares on the losing side, while 102 shares remained unchanged.

The BSE Sensex is currently trading at 27347.60, up by 202.69 points or 0.75% after trading in a range of 27293.53 and 27356.29. There were 26 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.79%, while Small cap index gained 1.12%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.55%, PSU up by 1.54%, Metal up by 1.28%, IT up by 1.24% and Capital Goods up by 1.23%, while FMCG down by 1.04% was the only losing index on BSE.

The top gainers on the Sensex were ONGC up by 3.28%, Tata Motors up by 3.28%, ICICI Bank up by 2.27%, SBI up by 1.71% and Infosys up by 1.68%. On the flip side, ITC down by 2.28%, Hindustan Unilever down by 1.03%, Hero MotoCorp down by 0.59% and Bajaj Auto down by 0.40% were the top losers.

Meanwhile, Monsoon rains have spread to cover almost all the nation, India Meteorological Department (IMD) said that monsoon rains have picked up in central and northern India in the last few weeks, helping to narrow the rainfall deficit in the current season to 6 percent, sharply down from 18 percent in the first week of June. It added that the conditions are favourable for progress of monsoon and it is likely to cover the remaining parts of the western states of Gujarat and Rajasthan this week.

IMD further said that though the monsoon arrived in India on June 8, a week later than usual, but it is set to cover the entire country on time. Normally monsoon covers entire India by mid-July, rainfall has picked up in central and northern India in the last few weeks and India is likely to experience better rain fall this season after two straight years of draught mainly due to a La Nina situation.

Earlier, IMD in its forecast had said that the country is all set to receive above-normal monsoon rains this year and retained its previous ‘above normal’ forecast for this year’s southwest monsoon, at 106 per cent of the Long Period Average (LPA) and above the 50-year average of 89 cm. The monsoon delivers nearly 70 per cent of rains that India needs to water farms, and recharge reservoirs and aquifers. Nearly half of India's farmlands, without any irrigation cover, depend on annual June-September rains to grow a number of crops.

The CNX Nifty is currently trading at 8385.95, up by 57.60 points or 0.69% after trading in a range of 8372.65 and 8390.80. There were 42 stocks advancing against 9 stocks declining on the index.

The top gainers on Nifty were Tata Motors - DVR up by 3.33%, Tata Motors up by 3.26%, ONGC up by 2.96%, ICICI Bank up by 2.21% and Eicher Motors up by 2.10%. On the flip side, ITC down by 2.34%, Bosch down by 2.21%, Hindustan Unilever down by 0.96%, Hero MotoCorp down by 0.95% and Grasim Industries down by 0.73% were the top losers.

All the Asian markets were trading in green, KOSPI Index gained 0.34%, FTSE Bursa Malaysia KLCI was up 0.48%, Taiwan Weighted added 0.17%, Shanghai Composite increased by 1.77%, Nikkei 225 was higher by 0.69% and Hang Seng surged by 1.49%.