Benchmarks trim gains; trade continues in green

After getting a gap-up start, Indian benchmark indices trimmed gains but continued to trade in green in the late morning session on account of buying in frontline blue chip counters amid firm global cues. In a big boost for the passage of the key GST Bill, a majority of states on Tuesday backed the government on key issues which have been stalling the Bill. This has raised hopes that with greater numbers backing the bill, it could be taken up in the Rajya Sabha or upper house in the current monsoon session of Parliament. The GST is seen as the biggest ever tax reforms in the country since independence. Investors also got some comfort with the report that Infrastructure spending has picked up in the country and NHAI is executing 205 projects including 18 worth Rs 13,500 crore on hybrid annuity mode. Also, NHAI is looking to bid out 30,000 km of projects in the next 2-3 years, which include several Greenfield expressway projects.  Some support also came in from reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 670.89 crore on July 26, 2016.

On the global front, Asian markets were trading mostly higher in early trade, supported by rebound in the Japanese stocks as yen lost footing against its American counterpart. The consensus does not see a rate hike in the Fed policy and it is largely expected that Fed may give weight to geopolitical risks arising from the Brexit vote. Further, Investors are hoping for further easing of monetary policy from the Bank of Japan (BOJ) after the conclusion of a two-day monetary policy meeting on 28-29 July 2016. Meanwhile, US stocks closed marginally higher on Tuesday amid major earnings reports and ahead of the central bank meeting.

Back home, barring Metal, all other BSE sectoral indices were trading in the green. Among them, banking index gained the most by 0.92 per cent, Capital Goods 0.90 per cent, Auto 0.81 per cent and Teck 0.61 per cent, while Metal index was down 0.15 per cent. In scrip specific development, Dr Reddy's Labs declined after the pharma major registered weak earnings as erosion of values in US assets impacted revenues while no fresh launches also led to pricing pressure. On the other hand, Zee Entertainment Enterprises rose after the company’s consolidated net profit rose 21.76% to Rs 216.96 crore on 14.74% increase in total income to Rs 1531.80 crore in Q1 June 2016 over Q1 June 2015.

The market breadth remained optimistic as there were 1397 shares on the gaining side against 757 shares on the losing side, while 148 shares remained unchanged

The BSE Sensex is currently trading at 28112.60, up by 136.08 points or 0.49% after trading in a range of 27973.37 and 28210.88. There were 23 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.32%, while Small cap index was up by 0.70%.

The gaining sectoral indices on the BSE were Bankex up by 0.92%, Capital Goods up by 0.90%, Auto up by 0.81%, TECK up by 0.61%, PSU up by 0.48% while, Metal down by 0.15% were the losing indices on BSE.

The top gainers on the Sensex were ICICI Bank up by 2.86%, HDFC up by 1.86%, Maruti Suzuki up by 1.53%, Tata Motors up by 1.25% and SBI up by 1.15%. On the flip side, Dr. Reddys Lab down by 8.98%, Tata Steel down by 1.74%, Axis Bank down by 0.84%, Lupin down by 0.58% and Reliance Industries down by 0.46% were the top losers.

Meanwhile, India Inc has raised $ 1.07 billion from overseas markets in June 2016, down 66% as compared to $3.16 billion in June 2015. As per the Reserve Bank of India (RBI) data, the total borrowings during the month, which included external commercial borrowings (ECBs) and foreign currency convertible bonds (FCCBs), $163.70 million were raised via approval route, while rest of $908.71 million came through the automatic route. 

Under approval route, PNB Housing Finance raised $ 150 million for on lending and Himatsingka Seide $ 13 million for refinancing of earlier ECB.

Among those in automatic route fund raising, Glenmark Pharmaceuticals raised $ 200 million for overseas acquisition, Siemens Healthcare Private Ltd $ 113.30 million for general corporate purpose and Idea Cellular $ 64.37 million for refinancing of earlier ECB.

The CNX Nifty is currently trading at 8638.85, up by 48.20 points or 0.56% after trading in a range of 8593.85 and 8665.00. There were 43 stocks advancing against 8 stocks declining on the index.

The top gainers on Nifty were Bharti Infratel up by 4.65%, ICICI Bank up by 3.25%, Maruti Suzuki up by 1.92%, HDFC up by 1.91% and Aurobindo Pharma up by 1.42%. On the flip side, Dr. Reddys Lab down by 9.08%, Tata Steel down by 1.82%, Yes Bank down by 0.90%, Axis Bank down by 0.88% and Bajaj Auto down by 0.64% were the top losers.

Asian markets were trading mostly in green; FTSE Bursa Malaysia KLCI rose 0.07%, Taiwan Weighted gained 0.34%, Jakarta Composite increased 1.16% and Nikkei 225 was up by 1.62%. On the flip side, Shanghai Composite declined 2.36%, Hang Seng decreased 0.43% and KOSPI Index was down by 0.25%.