Markets continue to trade in high spirit in late noon deal

Indian equity benchmarks continue to trade in high spirit in late noon session, on account of buying in banking and realty stocks. Sentiments remained buoyant after minutes of the U.S. Federal Reserve's July meeting indicated the chances of a September rate hike were slim. Firm opening in European market too support sentiment. European stocks climb for the first time in five days, rebounding from a two-week low, on speculation that central banks will remain accommodative. Back home, some buying was witnessed in selected metal counters on the report that India government slapped anti-dumping duty on certain cold-rolled flat steel products from four nations including China and South Korea to guard domestic industry from cheap imports. In scrip specific development, Bharti Airtel surged after Singtel is in pact with Temasek to acquire 21% of Intouch Holdings Public and 7.4% of Bharti Telecom for a total consideration of $2.47 billion. India Cements rises 2.3% to Rs 126.75 after company posted a net profit of Rs 43.98 crore in June quarter, up 16.35% from Rs 37.80 crore a year ago.

The BSE Sensex is currently trading at 28164.82, up by 159.45 points or 0.57% after trading in a range of 28077.00 and 28214.17. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.55%, while Small cap index was up by 1.06%.

The gaining sectoral indices on the BSE were Bankex up by 1.71%, Realty up by 1.41%, Power up by 1.34%, PSU up by 0.78% and Auto up by 0.64%, while Metal down by 0.28%, Consumer Durables down by 0.26 and Capital Goods down by 0.15% were the losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 3.61%, Adani Ports &Special up by 3.41%, ICICI Bank up by 2.43%, Bharti Airtel up by 1.98% and NTPC up by 1.42%. On the flip side, Coal India down by 2.24%, GAIL India down by 1.06%, Larsen & Toubro down by 0.87%, Tata Steel down by 0.87% and Infosys down by 0.60% were the top losers.

Meanwhile, credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has said that India’s industrial output will not return to a sustained and high growth path as long as excess capacity in the manufacturing sector remains and private investment does not revive.

Industrial output grew 2.1 percent in June and 1.1 percent in May. Even if the positive growth in the index of industrial production (IIP) in two consecutive months is encouraging, rating agency believes that it is still too early to expect an improvement and stability in industrial growth. Besides, retail and wholesale inflation for July came in at 6.07 percent and 3.55 percent respectively and manufacturing output increased to 0.9 percent year-on-year in June 2016 from 0.6 percent in the previous month.

The report stated that a marginal increase in manufacturing does not generate confidence that the downtrend in manufacturing has been reversed, the capacity utilization in manufacturing has been hovering in the range of 70-75 percent now for nearly five years. Further it said that an analysis of food inflation data over the past 6-7 years suggests that nothing has managed to tame food inflation.

Ind-Ra’s assessment said that food inflation despite a favorable monsoon could surprise on the upside, especially with regard to kitchen items like potato, tomato, onion, milk, egg, pulses - as has been the case in the past. It said that the goalpost shifts each time food inflation surprises on the upside. It has become routine to put the blame on the failure of monsoon, unseasonal rainfall, the futures market in agricultural commodities and sometimes on hoarding and black-marketing. But the normal monsoon so far has raised expectations that food inflation will moderate in coming months and cool the overall inflation

The CNX Nifty is currently trading at 8683.05, up by 59.00 points or 0.68% after trading in a range of 8645.05 and 8690.70. There were 38 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Ultratech Cement up by 4.78%, Indusind Bank up by 3.63%, Power Grid up by 3.49%, Adani Ports &Special up by 3.12% and ICICI Bank up by 2.32%. On the flip side, Coal India down by 2.27%, Tata Power down by 1.09%, Tata Steel down by 0.98%, Larsen & Toubro down by 0.90% and GAIL India down by 0.68% were the top losers.

Asian market were trading mostly in green; Taiwan Weighted increased 4.8 points or 0.05% to 9,122.50, KOSPI Index increased 11.72 points or 0.57% to 2,055.47, Jakarta Composite increased 77.09 points or 1.44% to 5,448.93 and Hang Seng increased 223.38 points or 0.98% to 23,023.16. On other hand, Nikkei 225 decreased 259.63 points or 1.55% to 16,486.01, Shanghai Composite declined 5.44 points or 0.17% to 3,104.11 and FTSE Bursa Malaysia KLCI dropped 1.07 points or 0.06% to 1,693.25.

European markets were trading in green; France’s CAC increased 11.03 points or 0.25% to 4,428.71, UK’s FTSE 100 increased 29.14 points or 0.42% to 6,888.29 and Germany’s DAX increased 43.96 points or 0.42% to 10,581.63.